FERC last week terminated three more Boyce Hydro hydroelectric licenses for projects in Michigan, the latest chapter in the continuing fallout of the utility’s 16-year ownership of the derelict Edenville Dam.
The commission rescinded licenses for the Secord, Smallwood and Sanford hydroelectric projects on the Tittabawasee River, saying Boyce, which filed for bankruptcy last year, lost the properties through condemnation and legal proceedings (P-10809-051, et al.).
Strong storms, an inadequate spillway and years of negligence led to the Edenville Dam’s failure last May. The ensuing flood surge also caused the Sanford Dam to fail and damaged the Secord and Smallwood dams, forcing the evacuations of 10,000 people and leading to a national disaster declaration. FERC had already revoked Boyce’s license for the Edenville Dam before the disaster. (See Michigan Dam with Prolonged Safety Issues Fails.)
The four lakes in Gladwin and Midland counties affected by the spillovers (Secord, Smallwood, Wixom and Sanford) remain dry lake beds. The Four Lakes Task Force, a volunteer group comprised of local lake association leaders dedicated to restoring the lakes, now owns the land where the hydroelectric projects sit. The group recently published restoration plans estimated to cost as much as $300 million.
In a press release, FERC said it was coordinating “the safe repair and management of the facilities” with the Four Lakes Task Force and the Michigan Department of the Environment, Great Lakes and Energy.
The commission also said that Four Lakes “has no intent to generate hydropower” from any of the dams and that the state of Michigan supports the decision.
Four Lakes Task Force President Dave Kepler has said FERC’s termination of Boyce Hydro’s licenses are crucial to being able to move forward with lake restorations.
Boyce Hydro filed for bankruptcy in July 2020. FERC still slapped the utility with a $15 million fine in April for its inaction after the breaches.
The commission said the penalty’s recovery is second to the “recovery of damages by victims of the dam breaches.” It noted that “Boyce Hydro’s liquidation plan ensures that the victims’ recovery will be before any recovery of the penalty.”
Boyce was owned by Las Vegas architect Lee Mueller, an heir of the Boy Scouts of America’s founder. Mueller and family members purchased the four dams in order to avoid paying taxes on the sale of an Illinois property. Michigan has sued Mueller over the flooding.
FERC tried for 15 years to get Boyce Hydro to address safety violations at the Edenville Dam, which included failing to increase the spillway’s capacity; performing unauthorized dam repairs and excavation; neglecting to file a public safety plan or follow its own water monitoring plan; and failing to acquire all property rights.
