In that particular part of the USA at that time period there was a significant increase in UFO sightings, and in North Dakota there was a case of a Sherrif driving around, becoming distracted by what he believed to be a UFO and driving his car off the road.
I think Hawley was upping the Coen-ism Absurdism (something ludicrous starts the dominoes falling towards and grander, epic finale) whilst adding a piece of local folklore into the mix.
He's a genuine creative talent and I'll give him a very long leash when it comes to the more esoteric and confusing elements of his work. Plus, frankly, not everything that happens to or around us has to make sense, but rather how we react to it.
Hugo - It's just a flying saucer, Ed, we gotta go!