City of Lake Oswego and Lake Corporation veil lake pollution
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Beneath the surface of Oswego Lake, the crown jewel of one of Oregon's most affluent communities, lies a 20,000-foot pipe, the backbone of the city's sewer system. Anchored to the bottom of the lake and rimmed by about $1 billion in real estate, the pipe is slowly failing.

Engineers charged with fixing it began their work in 1999, straddling hurdles that ranged from the lake's complicated geology to seismic concerns. By 2006, they had crafted one of the most dynamic projects ever proposed in water: They would build a floating pipeline, one that could flex with changing temperatures and still retain a downward slope across the lake.

The floating gravity system would be the first of its kind in the world. It would cost $65 million to build, more than OHSU's tram, a figure that when financed would triple sewage fees in the city's water utility or raise property taxes by $150 to an average household for 20 years.

But while poised to secure permits for the job, city officials made a discovery in the spring of 2003 that froze the project for more than a year, according to documents and interviews obtained by the Lake Oswego Review.

While pursuing permits for their work, they learned that the Lake Oswego Corporation's 50-year history of pesticide use had put hundreds of thousands of pounds of copper in the lake and potentially contaminated its floor. The pipeline threatened to cue scrutiny of both the project and the lake by the U.S. Environmental Protection Agency.

Through negotiations with the Lake Corp, construction plans were shifted to avoid federal permits for the job and EPA scrutiny. If the plans move forward, the ailing sewer pipe will be replaced. But potential violations of the Clean Water Act now lie - with possibly toxic levels of copper - safely quiet at the bottom of Oswego Lake.

A bleak financial picture

Anyone who lives here knows it: Oswego Lake is naturally green and, historically, copper sulfate has been used to reduce its algae levels.

The use of copper sulfate - a pesticide loosely regulated by the federal government - has never been a secret here.

Oswego Lake occupies 415 acres at the bottom of a watershed. Much of what flows downhill in Lake Oswego goes into the lake, including eroded soils and fertilizer, both high in phosphorus, fostering algae growth.

Copper sulfate, for roughly 50 years, offered a solution.

But in the spring of 2003, a firm hired by the city to replace a failing sewer pipe also found the former solution had consequences.

Early tests showed abundant copper in the lakebed, according to Lake Oswego City Manager Doug Schmitz, which threatened to trigger scrutiny of the lake under the federal Clean Water Act. If copper levels topped EPA guidelines, the testing could lead to costly safety controls or an expensive clean up, which could stall or kill the pipeline project.

In a meeting between city officials, regulators and the Lake Corp, federal agents said they would require chemical testing in the lake where engineers needed to dig.

'They were kind of painting a pretty bleak picture and one where we could see the dollar signs going ka-ching, ka-ching, ka-ching and how do you control that?' said Joel Komarek, city engineer for Lake Oswego and the liaison to contractors on the job.

Engineers from Brown and Caldwell, the firm that designed the floating pipe, presented the dilemma posed by environmental testing to Schmitz in October 2003. Schmitz immediately halted the job.

He said his decision was based in part on the copper findings.

'(The copper) was prevalent enough that it raised a concern about whether there was a potential brownfield site here. It got into who is responsible for its removal, if that came down from the regulatory agencies,' he said.

'If we end up in a squabble with the Lake Corp over who was responsible for the clean up, if that was required, then … the budget estimates did not include toxic removal costs,' Schmitz said.

He said other concerns about getting land from the corporation to put the pipe on and the cutting-edge technology eyed by Brown and Caldwell also influenced his decision.

Days after the project stopped, Jon Holland, an engineer with Brown and Caldwell, asked for more information on copper from the Lake Corp. In response, he received an e-mail that confirmed the potential for problems.

Copper: Friend and foe

E-mail and phone records set the average use of copper sulfate by the Lake Corp at about 21,000 pounds a year between sometime in the 1950s and 1993. The exact starting date is not known. At its highest use during that time, 37,000 pounds of the pesticide were applied to Oswego Lake in 1983. Lower doses continued from 1993 until 2001.

Light use of copper sulfate is legal and can control algae problems. Because copper is a metal, it kills algae on contact and settles quickly to the bottom of waterways, where it binds to the soil and is considered harmless. But users of the pesticide are required to keep levels of copper in sediment below EPA standards. The exact standard for Oswego Lake is unknown because it requires a calculation based on other water quality data not available.

In Washington, annual doses of 5,000 pounds of copper sulfate for 30 years contaminated the floor of Lake Steilacoom, near Tacoma, which covers 330 acres, about 85 acres less than Oswego Lake and is shallower at 20 feet deep. The Washington Department of Ecology banned copper sulfate statewide as a result. Studies at Lake Steilacoom showed copper levels in the lakebed were so high that the copper stopped binding to sediment and was floating free in the water column.

When present in water, copper is toxic to most aquatic life and is easily absorbed through the gills of fish. Large amounts of copper are also corrosive to the skin and eyes of humans.

In Oswego Lake, copper will stand in the way of digging into the lakebed and complicate the pipeline project. It will also complicate dredging, which is becoming necessary as erosion from streams creates deltas that obstruct boating.

Phone records outlining talks between city officials and the Lake Corp show that West Bay has received the highest doses of copper sulfate in Oswego Lake. Tests there showed no problems in 1991, according to lab work supplied to engineers by the Lake Corp.

Bill Wiley, president of the Lake Corp, said he was not aware of any data to the contrary.

'To the best of our knowledge, it's not a problem. It's probably not relevant unless the sewer is to be on stilts in the lake, in any case,' he said, referring to a construction method that would require testing for permits.

But city officials were concerned enough to back off. Between May 30, 2003, and March 2005, the only official activity on the pipeline project was a study to pull it out of the lake. The costs appeared prohibitively high, estimated then at $97 million.

City violates DEQ plan

Yet the need to replace the existing sewer line was real. Lake Oswego sewers first began to overflow in 1996 because of limited capacity in the existing pipeline. The city saw massive overflows of sewage in the winter of 2003 during heavy rains. Wet weather in 2005 did the same thing, and meanwhile, the Oregon Department of Environmental Quality warned Lake Oswego, insisting on a fix.

Should the sewer interceptor ever completely fail, the result would be a massive infusion of untreated sewage to Oswego Lake and the Willamette River. DEQ officials are aware of the potential for catastrophe and in 1998 and 2001, waived fines for overflows on the single condition that Lake Oswego set a construction schedule to build a new pipeline.

Lyle Christensen, who oversees the project for the DEQ, said he was never informed that work on the pipeline stopped after the 2003 spills and that the lags in planning violate the city's agreement with DEQ.

'As far as I knew they were still proceeding,' Christensen said. 'We kind of said in 2003: 'Continue and provide us with your plans for resolving this.' I don't think we ever penalized them at that time but certainly they were under warning.'

Since last winter's spill of 97,000 gallons of sewage into the lake, Christensen said DEQ called for tighter timelines on a sewer fix, again in lieu of fines. Instead, he said, several months of negotiation with the city have dead-ended and fines are pending. Christensen said his experience with Lake Oswego differs from that of other cities, which typically keep construction plans on track to avoid fines.

'Generally that's what it takes, but in the case of Lake Oswego, it's a high-cost thing and maybe they're rolling the dice and seeing how long they can go,' he said.

While work on the pipeline stood still, Schmitz said he and Mayor Judie Hammerstad met quarterly with Lake Corp officials. In recent years, he said, these regular meetings have included talk about hurdles in the pipeline project. There are no minutes or records for what takes place in these meetings, but a letter to Schmitz from Holland suggests the city use private meetings to negotiate for land and a construction plan that could avoid federal permits.

Five of the city councilors interviewed for this story - Jack Hoffman, Gay Graham, Ellie McPeak, Frank Groznik and John Turchi - knew of the meetings between Hammerstad, Schmitz and Lake Corp. Each said they did not know negotiations were aimed at avoiding federal permits and three said they were unaware the project ever stopped. Lynn Peterson denied any knowledge of the problems or related meetings.

Asked whether they knew of copper problems, four of the five members of the city council (Groznik was not in office at the time) recalled a presentation made by Komarek, the city engineer, in fall 2003. There are no meeting minutes from this work session with the city council.

No permits required

While negotiations with the Lake Corp continued, Brown and Caldwell recommended adding an environmental permitting team from David Evans and Associates to the project to push the pipeline forward. In November 2005, a project manager from the team proposed a way to avoid permits that required testing. In a memo to Brown and Caldwell, Dana Siegfried, selected for her ability to permit environmentally challenging projects, proposed this solution:

'If sediments are removed from the lake and not redeposited, then… testing requirements should not apply. Sediments are more easily contained and less likely to be redistributed within the lake if construction occurs during drawdown.'

Previously, the idea of draining the lake for construction was unacceptable. When talk about the pipeline first began, the Lake Corp fought hard to see the pipeline built in water and threatened to sue for everything from loss of views to water quality impacts if the lake was lowered.

Lake Corp officials said publicly in 2004 that lowering the lake would harm the corporation's water quality plan, which calls for limited flow from the Tualatin River to keep phosphorus levels, and thus algae growth, in check.

But by March of this year, Lake Corp officials were warming to a new plan. Wiley said the Lake Corp is now willing to do anything reasonable to move the sewer project forward, including lowering the lake.

Last March, Komarek and Holland met with federal officials and proposed the city's new idea: Crews would drain the lake 16 feet to do the job, perform excavation in a dry lakebed, then dispose of lake bottom soil at a Hillsboro facility for non-hazardous special waste.

The proposal was given a green light: Permits calling for sediment testing under the Clean Water Act would not be required.

Jan Stuart, project manager for the U.S. Corps of Engineers, which oversees permits under the Clean Water Act, later said she couldn't require permits because the plan to trench in water had been taken out of the job.

Changing the construction plan was acceptable, she said. Asked whether she would have concerns if the project was conceived to avoid copper problems, Stuart said the question fell outside the purview of the Corps of Engineers.

'That's fine with us. We're not a prescriptive agency, we're a permitting agency,' said Stuart.

Christensen, the DEQ official, said if Lake Oswego officials told him they had toxicity problems on the site, he would have referred it to a clean-up program run by DEQ, which enforces the Clean Water Act on behalf of the EPA in Oregon.

Because Oswego Lake enjoys exemption from the federal Navigable Waterways Act - which makes the lake private - only permits or a DEQ inquiry could have triggered testing on the lake's floor. The DEQ only monitors publicly accessible waters. Sampling at Oswego Lake would require permission from the Lake Corp, or a specific concern to spark the agency's right of entry.

A history of public pressure

Today, the use of copper sulfate is still legal in Oregon, though the EPA is currently lowering the limits on copper in water and reviewing its registry of 'general use' pesticides.

Copper sulfate is loosely regulated under a federal law called FIFRA, which requires only that applicators read and follow instructions when applying those 'general use' chemicals.

'As long as the applier, the lake manager let's say, is following that FIFRA label, then the herbicide that's been added to the lake is not considered a waste,' said Karen Williams, a water quality specialist with DEQ.

'The chemical could be considered a pollutant if those label instructions were not followed or the act of not following the instructions resulted in a water quality problem,' she said.

Mishaps with FIFRA chemicals - including a 1996 incident that killed 92,000 salmon in Talent, Ore. - prompted a court battle that tightened local controls on the federal law but the EPA so far has not followed the court's ruling. The Oregon Department of Agriculture is crafting the state's first pesticide tracking program, following the lead of states like California, to put in place more controls.

As general pesticides continue to be available, chiefly to aid farming, the pressure to employ them for aesthetic ideals is intense. Locally, Lake Corp shareholders continue to push for the lake to mirror residents' vision of pristine water.

Shareholders have repeatedly organized to seek relief from algae and since the lake's first experience with a toxic strain in 1998, have divided over the Lake Corp's stance on water quality.

Some support pesticide use.

Others do not.

In fall 2004, reacting to the toxic bloom that briefly closed the lake to recreation the previous summer, a group known as the Concerned Shareholders took hold and demanded water quality data from the Lake Corp without success. They made several passes to oust the Lake Corp's current board of directors, taking their fight for records to a Clackamas County Circuit Court. They lost when a judge ruled in favor of the Lake Corp under Oregon's business protection laws but portions of the suit charging fraud in elections are still pending.

As disputes over water quality raged at the Lake Corp, the city of Lake Oswego shared no details of its copper findings with shareholders or the public.

Mayor Hammerstad said if people had sought the information, it would have been available from the city.

'I don't think there was ever anything that was not in the public eye,' she said. 'My general opinion about things like that is that if people ask for it we give it to them.'

Internal e-mails show city officials have considered a confidentiality agreement with the Lake Corp to keep water quality data private. City attorney David Powell said the idea was rejected and no such agreement exists today. Other city officials have confirmed that statement.

Wiley, president of the Lake Corp, denied any knowledge of such agreements.

But, internal city documents show Wiley himself drafted the agreement after a Lake Corp shareholder sought data on water quality through the city. He crafted it to be retroactive, which would have forced the city to reject the records request from the shareholder had city officials signed it.

See related documents below:

Confidentiality Agreement Proposed by the Lake Corp

Copper Sulfate Applications

Next Steps, pages one and two of six

Permitting Plan by David Evans and Associates

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