The Edenville Dam Failure and Flooding Disaster in Midland County

The “Gold Mine” behind Hands-Off Governance

Jim Olson is FLOW’s Founder, President, and Legal Advisor

Edenville Dam photo courtesy of Midland Daily News

By Jim Olson

The accounts of the failure of the Edenville dam on the Tittabawassee and Tobacco Rivers and the devastating damage and threat to safety and life beg the question: How did the owner and a dam stamped as a red-zone for hazardous risk escape regulatory enforcement before it failed? Who is responsible? What’s really behind dam failures, infrastructure collapse, and increasing events across the country with catastrophic loss to people, communities, property, and quality of life?

Since 1999, governmental officials had warned Wolverine Power and its current owner Boyce Hydro that the spillway would cause massive flooding and damage if the capacity of the spillway was not doubled in size. The owner ignored the warnings and, according to journalist Garret Ellison at MLive, hired a lawyer to send a letter to officials stating that it was unreasonable for government to demand the fix at a cost of $8 million because his client couldn’t afford it! This does not shield the dam owner from taking corrective action to prevent massive harm, let alone the cost to fix. In fact, there is no conceivable legal theory that would excuse the owner’s failure to double the size of the spillway.

The Federal Energy Regulatory Commission (FERC) ordered the owner to shut down hydroelectric power operations in 2018. Not long after, regulatory authority shifted to Michigan’s Department of Environmental Quality (DEQ), now Department of Environment, Great Lakes and Energy (EGLE). For the past two years, the company has continued to stonewall efforts to increase the capacity of the spillway. The owner claims he should be able to simply draw down the Wixom Lake impoundment. Landowners on the lake and EGLE have opposed this because of adverse impacts to the environment and riparian and public use. In the middle of a longstanding contentious battle and trail of warnings, no enforcement action has been taken to force the doubling of the capacity of the spillway as directed by FERC 20 years earlier.

None of this is new. The collapse and failure of infrastructure from dams, to bridges, highways, stormwater and drainage controls, and buildings now magnified by climate change should come as no surprise. Yet in each case everyone is caught by surprise. Do we just chalk this up to climate change and dole out bailout money to pay for the restoration and return of people to normal?

Before the 2017 California Oroville dam catastrophe that caused the evacuation of 180,000 people in the path of a 30-foot high wall of water, despite reports pinpointing the need for repairs, nothing was done before the rain event collapsed the spillway.

Closer to home, a 3 to 7-inch rainfall in the western Upper Peninsula in 2018 washed out highways, stormwater infrastructure and destroyed homes, causing three deaths. These events occur across the state, country, and world, and it would be correct to point to the increasing intensity and frequency of rainfall attributable to climate change. Most of the 1,049 regulated dams (6 feet high or more) in Michigan are privately owned, too costly to repair and maintain, and according to MLive’s Ellison about 15 percent of these dams continue to be classified as a high-risk, hazardous risk.

Oroville, the Western UP, and Edenville and Midland flooding will repeat and repeat, more frequently and perhaps more gravely, if it is even fair to compare the devastation from one loss to another. Tens of thousands lost their homes from flooding in Bangladesh in 2019, where more than 4 million are threatened with disease and starvation. As pointed out by climate-change activist and writer Peter Sinclair, who experienced the Midland flooding firsthand, the 40-percent rise in rainfall events in the past several years attributable to climate change will repeat itself throughout Michigan and the Midwest.

Part 1: Who Is Responsible for the Edenville Dam Failure and Midland County Damage? The Immediate View

Before answering the responsibility question, the first thing to do is understand applicable laws.

The Common Law of Riparian Lakes and Streams

Under the riparian reasonable use doctrine, the waterfront landowner does not own the water, the water is common and controlled by the state for its citizens. Each riparian landowner has the right to reasonable use of the water flowing by their waterfront to benefit the land. This includes traditional uses such as domestic, gardening, farming, and artificial or commercial uses such as generating hydroelectric power or operating a mill. But a use is unreasonable where it interferes or harms the riparian use of the common water by another waterfront landowner. Where there is an impoundment, the riparian owner must have acquired in some fashion the flooding rights for the upstream lake or pond.

A dam owner is not responsible under the common law for draw down and harm to riparian or other property interests of riparian upstream or downstream, so long as the riparian owner uses or manages the dam in a reasonable manner. But if the dam owner is negligent or creates a private or public nuisance, the landowner is responsible for the damages that flow from the actions or failure to act.

A dam owner’s reasonable use of a navigable stream is also subject to the public trust doctrine. Under Michigan law, our navigable lakes and streams are held in public trust by the State as trustee for the purpose of managing and protecting the rights of citizens to use these public trust waters for boating, fishing, drinking water, swimming, and other recreation. A riparian landowner may have a right to build and operate a dam, but only if the use is reasonable and the landowner obtains the right to occupy those waters from the government.

The Edenville dam owner will find it difficult to defend a failure to take action to prevent a known risk and failure of the dam and damage to upstream and downstream landowners, communities, and businesses. A lawyer’s plea that the $8 million is too costly and lets his client off the hook won’t fly. Nor will the owner’s claim that other landowners and the State interfered with his efforts to draw down the lake impoundment. The condition of the dam and duty to fix and prevent releases is the responsibility of the owner. If he was negligent or created a nuisance, that others were seeking to protect their own interests by trying to stop the company from acting doesn’t excuse the responsibility to take action in an emergency.

The Public Trust Doctrine

In addition, to liability to another riparian, a landowner can also be liable to the public under what is known as the “public trust doctrine.” Our lakes and streams are public and held in trust by the State to protect water quality, flows, levels, fish, habitat, and riparian and paramount public trust uses like boating, fishing, swimming, and drinking water. (Glass v Goeckel, Mich (2005); Obrecht v National Gypsum Co., 361 Mich 399 (1960); Illinois Central Railroad v Illinois, 146 U.S. 387 (1892); Collins v Gerhard, 237 Mich 38 (1926).) The State as trustee of our waters and protected uses has a duty to make sure government and persons do not impair or subordinate this public trust. This duty is solemn and in perpetuity.

The State cannot authorize the location and operation of a dam on a stream or at the outlet of a lake unless it is determined that there will be no subordination or impairment of the public trust resources and public uses uses—fishing, boating, drinking water, sanitation, swimming. If during the life of the dam or on its removal, there is a risk to the public trust, the State has a trust duty to take action to prevent adverse impacts to the public trust.

A dam owner is legally responsible for the impairment or interference with public trust resources and uses. Similarly, the state as trustee (like the trustee managing investments at a bank) is responsible for a breach of its duty to protect those public trust resources and uses.

Once again, the dam owner is not only responsible to other riparian landowners, or for damage caused to others person or property through negligence, the dam owner is responsible for damages to public trust water and natural resources or uses such as boating, fishing, drinking water, and swimming. The damage to public trust resources, uses, infrastructure, and property is extensive.

But what about the State? Here the inquiry shifts from the dam owner to the state as trustee of the waters and public trust uses to determine whether it fulfilled its duties under the public trust doctrine. Did the State as trustee breach its public trust duty by not taking or compelling emergency action to prevent injury to the public trust waters, property and public trust interests along and to the Tittabawassee and Tobacco Rivers and upstream and downstream from the Edenville dam? The duty is there, the inspections are there, the knowledge is there, the high-hazardous classification was there, but the disaster happened. Is the State off the hook?

Maybe, maybe not. This requires not only a look at the State’s duty to act under the public trust doctrine, but also a look at related laws that regulate dams, lakes and streams, and stream and lake water levels.

Michigan’s Dam, Stream and Lake Laws and Regulations

Public and private Michigan dams are regulated by the Dam Safety Act (DSA), Inland Lake Level Act (ILLA), and the Inland Lakes and Streams Act. The Dam Safety Act (DSA) requires permits for construction, repair, enlargement, abandonment and removal. The purpose of the DSA is to ensure dams are constructed, inspected and maintained properly, and that dam owners are prepared for an emergency. An owner is required to submit inspection reports every 3 to 5 years. The DSA classifies dams according to their risks, including high-hazard dam, and imposes standards for capacity of spillways based on 200-year storm events.

The law requires inspections, evaluation, and recommended actions to prevent dam failure based on the condition or change in condition of a dam. There are provisions to require performance bonds or letters for credit that cover completion of construction, but the bonds do not cover required repairs or corrected action or damages to property, natural resources, or the public trust. The law also grants EGLE broad emergency powers to prevent dam failures through orders and court action to remove or fix a dam to prevent injury to property and the public trust in water and natural resources.

The ILLA authorizes inland lake owners, other affected riparian landowners, and the State to petition a circuit court to establish lake levels through construction, maintenance, and changes to impoundments and dams. In setting levels, the court must take into account the environment, natural resources, riparian landowners, and public trust in lakes and streams. Where improvements or repairs are required, the State or other affected persons can petition the court, and the court can order the improvements or repairs and establish a special assessment district to pay for them.

The ILSA like the DSA requires permits for dams, but it goes farther than that: It prohibits dams unless authorized by EGLE based on findings that there will be no harm to the public trust or riparian interests in the affected lakes and streams. It also establishes a state fund from fees generated by the ILSA that can be spent on required repairs, improvements or other actions to prevent the failure of dams and harm to the public trust. The ILSA authorizes the State to apply these funds to address problems that arise under the DSA.

The Federal Energy Regulatory (FERC) Commission also regulates dams that produce hydroelectric power. Because the dam owner failed to enlarge the spillway, FERC revoked its hydroelectric license in 2018; so, jurisdiction defaulted to the State’s (Department of Environment, Great Lakes, and Energy (EGLE) under the dam safety law, but the dam’s owner didn’t file the required inspection and corrective action report, and EGLE didn’t take immediate action to address the hazard until the Attorney General and the dam ended up in court over the company’s draw-down practices that impaired the riparian rights of upstream Wixom lake landowners.

The public trust in the waters of the State imposes a duty on EGLE to protect lakes, streams, and public’s uses of these waters. Should the agency have taken stronger actions by notifying interested riparian landowners and tapping state funds to spend the $8 million or remove the dam, rather than fight over drawdowns to protect the riparian owners’ desire to maintain the level of Wixom Lake, when it actually increased the danger? EGLE knew about the high-hazardous condition of the dam, a condition that grew worse through 2019 and early 2020—the dam was classified in the red-zone of high risk—but the State did not take any affirmative enforcement action to prevent a collapse until after the dam failed which resulted in the extensive damage.

But, after the failure, the State finally took definitive action. No more passing the buck—big bucks—from owner, to FERC, to property owners, to EGLE. On June 9, Attorney General Dana Nessel filed a lawsuit in Ingham County to protect public safety, recover damages and response costs, and seek court orders directing the owner to restore the dam, remediate harm, and ensure it does not happen again.

Unfortunately, this came too late, so now the action will have to reach the deep pockets of those who are responsible. Where those deep pockets are based on principles of responsibility remain to be determined by the courts. It seems this much is clear: Boyce Hydro and its configurations who owned and operated the dam, or controlled decisions, will participate in the damages and actions required to restore as much as possible of the river, lakes, infrastructure and natural resources.

But the extent of damage is so massive that most of it will be picked up by the taxpayers. As for a new dam that is safe, that will be up to those who fall within the special assessment district. It is only fair that those who benefit from the dam should pay for it through fairly apportioned assessments. It should have been done a long time ago.

The State’s failure to do more will be the subject of examination. Clearly, EGLE took some steps in the past two years since ending up with the “hot potato” after the license was revoked. But those steps appear to be just that, requests for inspection, volunteering to help local task force petition the circuit courts to set a lake level, and offering money toward the solution of a special assessment district for the property owners and public who benefit from the dam.

But this must be contrasted with the fact that budgets have been cut over the years, only three overworked staff manage the safety of the State’s 1,061 regulated dams, the dam fell in the high-hazard zone, and EGLE never issued an order of filed an emergency lawsuit to prevent the disaster, although the law clearly gave it the authority to do so. Too, EGLE could have petitioned the circuit courts to set a lake level and fix the dam and spillway on its own petition, but failed to do so.

In final analysis, like the Flint crisis and so many others, there is little doubt the State failed to take seriously its affirmative duty as trustee to protect the public trust in the waters and health of the people who live in the Tittabawassee and Tobacco Rivers watershed.

It’s time to ask the bigger question, how did our leaders allow these disasters, one after the other, to happen? Does it have to do with a government that has abdicated its duty to protect the public health, safety, and welfare, our common water resources and health, in favor of the narrow, economic self-interests of others?

Part 2 The Gold Mine Behind Hands-Off Governance and Deregulation

I don’t think we can write off events like the Edenville dam and elsewhere around the nation or world as the reckless deliberate conduct of one owner or one dam. Nor can we chalk it up to climate change. Scientists, regulators, and dam operators have known for years the denial of climate change has resulted in undersized and failed infrastructure.

The Dam Safety Act imposes a 200-year storm event standard, and in some instances allows the operator to operate a dam sized for half-that amount of rain. The Midland storm reached a 500-year rainfall event, and the fact is most everyone knows these events, particularly in localized areas, are far more frequent than one every 500 years.

In fact, we live in the midst of another climate change—a political one—one that is equally at fault and should be held accountable. For more than 30 years or more there has been a concerted effort on the part of government leaders, legislators and the lobbyists who support them at both the state and federal levels to deregulate, downsize, and shrink the effectiveness of government to serve the public health, safety, and general welfare—the common good. When it comes to public waters, it is even more inexcusable, because, as noted above, government has a duty to take affirmative actions to prevent impairment or harm to our public trust lakes and streams.

Add to this a parallel concerted effort by government leaders to deny climate change, and the fate of worsening, catastrophic damage to our water resources, property, economy, and quality of life is a foregone conclusion.

So, to give us a better focus on the big picture of the collapse, washout, and failure of public and private infrastructure, loss of homes, businesses, life, and community, it helps to look back to the two eras of governance: President Reagan and Michigan Governor John Engler. What this reveals is not just individual dam failures or climate change, but a systematic collapse or washout of governance itself.

We no longer enjoy the kind of government where leaders are elected or appointed to carry out the public trust placed in them to fulfill their responsibility to protect the public health, safety, and general welfare of people. While some might try to chalk this up to the pendulum of left and right politics, it is not. This is demise of governance that is entirely by design and driven by an ideology backed by interests that benefit at the untold harm and suffering of the people for whom government exists in the first place.

The Reagan era brought us “trickle-down” economics—let the spillage of wealth created by the exploitation of government regulations and enforcement trickle down to the middle-class and poor. Reagan appointed James Watt, a former Wyoming political aide and CEO of a mining and oil and gas institute, to head up the Department of Interior and National Parks, and Ann Gorsuch to head the EPA. In no time, mining, oil and gas leases poured out of the federal government’s land bureaus, agency budget cuts and rollbacks on air and water protection, everything really, proliferated, and environmental enforcement plummeted. Needless to say, new efforts to protect the environment and health stalled. Under President George W. Bush, things got worse. The dozens of rollbacks by the Trump administration and his cronies in Congress are driving the common good, safety, health and welfare of people and place to the bottom.

The Engler era in Michigan (continued by Governor Snyder’s administration from 2011 through the end of 2018) deconstructed and demoralized a state government that had exemplified fairness, common good, protection of health and the environment under Governor William Milliken. Engler broke up the Department of Natural Resources (DNR), one of the most professional, highly-respected natural resource and environmental protection agencies in the country. He split DNR into the new Department of Environmental Quality and the DNR. Then by executive order he transferred all environmental regulatory powers over air, water, regulatory investigation and enforcement from the DNR to the DEQ. The DNR was a shell of its former self, left to managing land, fish and game areas, parks, and hunting and fishing.

Then he abolished the Air Pollution Control and Water Resource Commissions to remove citizen oversight, and took control of the DEQ by taking over the power to appoint its director from the Natural Resources Commission, the last stop for citizen participation and public debate for the most controversial decisions. Next, he offered buy-outs to remove demoralized skilled staff and cut budgets and staff across the board; he spurred dozens of tax cuts, and in 1995 signed into law the Natural Resources and Environmental Protection Act, which when all the fanfare settled, gutted the “polluter’s pay” law—a hazardous clean up based on strict liability—and turned it into a “polluters play” law. As a final blow, the role of regulatory enforcement was replaced by a façade of a good-corporate voluntary audit law, leaving environmental protection in the hands of the regulated.

Sadly, Michigan’s rise for protection of the environment and health and aggressive enforcement (See Dave Dempsey’s Ruin and Recovery: Michigan’s Rise as a Conservation Leader (University of Michigan Press, 2001) has turned into an aggressive fall from deregulation and lack of enforcement. Of course, this went right along with the tax cuts, since money wouldn’t be needed for the environment anymore. One standard after another relaxed, one dollar after another for enforcement and staff slashed. In a state that for two decades put into practice article 4, section 52 of its State Constitution declaration that air, water, and natural resources are of “paramount public” interest, the Engler and Snyder administration and an ideology embraced by the legislature and self-interests of business have subordinated this constitutional paramount interest and responsibility.

Add to the mix almost 40 years of a near religious fervor for a free market mentality that has fostered a wholesale deconstruction of the role of government to promote the common good. Then add at least 30 years of orchestrated denial of global warming and climate change, and the big picture emerges—little government, no regulation, small taxes, short budgets, and an ideology to destroy the balance of the common good, environment, and welfare of people and business and the economy—welcome to July, 2020.

So, what does this have to do with the Edenville dam? We live in two distinct climates that are doing harm that threatens life and earth as we know it. One is a political ideologically, money-driven cultural climate that weakens, delays, disturbs, destroys government for an uncontrolled exploitation of people, environment, and community. The other is a climate that is exponentially hammering our lives. COVID 19 pandemic has filled us with angst over the future and the well-being of our families, communities, and the world. But that uncertainty was already here and will continue wreaking havoc with indifference to all of us.

From 1980 to the present, a few strong corporations and their financiers have enmeshed themselves in the control of government for one reason. These corporations saw that their manifest destiny to extract and develop minerals, oil and gas, natural resources, and exploit labor and communities was peaking, coming to an end. They saw only one destiny left, a gold rush worth trillions of dollars buried deep in the regulations that protected our environment, health, people, and communities. They realized that it was time to mine the gold beneath the bedrock of federal and state regulations, enforcement, and budgets that protected people and their community.

No wonder the Edenville dam failed and the hazardous risks of failed dams and infrastructure continues to rise. Infrastructure risks and collapses have become endemic to our society. The denial of climate change and pernicious indifference to the common good, health, and safety and welfare are a plague on our nation and people. As we watch or join in the protests by our own citizens—people of all colors—the message is clear. We’ve had enough. The tyranny of political power that protects those who mine the gold of deregulation and the demise of governance must end.

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The “Gold Mine” behind Hands-Off Governance