U.S. Forest Service may face steep fine for leaks at Holland Lake wastewater system

The U.S. Forest Service could be fined as much as $10,000 a day for violations related to leaks and unreported, unapproved repairs at the wastewater treatment system at Holland Lake, according to the Montana Department of Environmental Quality.

The Forest Service confirmed this week the system isn’t receiving any new waste, and the DEQ said the leaking has subsided and the system is temporarily shut down.

The wastewater ponds serve the campgrounds at the lake, an RV dump station, and septics connected to Holland Lake Lodge.

In an email this week, the DEQ said it is taking enforcement action but does not discuss penalty amounts until it issues a formal order, which can take 120 days.

However, the DEQ outlined in an Oct. 18 letter to the Forest Service details of violations to the Montana Water Quality Act and Public Water Supply Laws.

The letter said the Forest Service discharged into state waters without a permit. It calculated one leak, discovered this month by the Forest Service in preparation for a leak test, at 50,000 gallons from Oct. 6 to 13.

(The Forest Service had added water to a pond in order to test; no new effluent was reaching the pond because the septics are valved off and the campground and dump station are closed, according to the letter.)

Holland Lake, a popular and picturesque destination in the Swan Valley, has been in the public eye since last fall.

Last September, the Forest Service announced a proposed plan — controversial, and recently shelved — to expand the private lodge that operates on public land in partnership with a Utah-based ski and adventure company.

Opponents argued the planned expansion would hurt threatened and endangered species and put undue pressure on natural resources and infrastructure, such as the wastewater treatment system.

The Forest Service holds the sewer permit for the wastewater treatment system, and earlier this month, the DEQ announced it was leaking “far in excess” of the amount allowed.

The DEQ had received a complaint about the leak and potential contamination to groundwater and surface water, and it calculated the leak rate at three times as much in eight days as is allowed for an entire year.

In the Oct. 18 letter to the Forest Service, the DEQ also said it found the liner in part of the treatment system “had suffered extensive damage, including a tear that extended below the level of the wastewater.”

The letter also said the Forest Service made repairs in summer 2022 but didn’t notify the DEQ of the rip, ensuing leak, or repair, nor did it test for leaks after its repairs.

The DEQ said monitoring wells will give the state an idea of the impacts to groundwater, which will help determine the formal order.

However, this week, the DEQ also said the situation has improved.

“The latest measurements taken Oct. 25 show the liner is still leaking, but at a significantly lower rate,” the DEQ said. “The pond is currently leaking at approximately ½ inch per day compared to initial leaking of 3.5 inches per day.”

The letter said stabilization is considered pond levels dropping no more than 1/10th of an inch between measurements on a semiweekly basis.

However, the DEQ said the Forest Service wasn’t supposed to work on the treatment system without alerting the state agency and without testing the fix.

“The USFS altered the approved public wastewater system by making significant repairs to the liner without conducting a leakage assessment test to ensure that the repaired liner complied with the requirements of (DEQ design standards),” the DEQ said.

“This alteration without prior DEQ review and approval is a violation of the Public Water Supply Laws.”

The letter directed the Forest Service to take a series of actions, immediate and longer term.

Those include stopping any additional inflow until the treatment pond is repaired “in accordance with DEQ standards,” providing an explanation for an unaccounted 200,000 gallons of wastewater identified in 2021 records, conducting nutrient sampling, and installing a monitoring well.

DEQ demands also include submitting to the state “hydraulic gradient and direction between the lagoon and the lake” for review, and, by January, engineering reports to determine whether the ponds are big enough, and plans for new liners for DEQ to approve.

In an email, Flathead National Forest spokesperson Dan Hottle said the situation at the wastewater site remains a “top priority for the Forest Service to remedy.”

The Forest Service “is continuing to work closely with MTDEQ to determine the extent of impact from the leak,” Hottle said. “We are collaborating with them on recommendations made in the October 18 letter and are continuing to monitor the effluent levels. The system has been shut down and is not receiving any new inputs.”

The letter from the DEQ notes the Forest Service may be subject to fines under the Montana Water Quality Act and Public Water Supply Laws, up to $10,000 per day, per violation, and up to $500 per day, per violation, respectively. State statute notes the maximum total for any related series of violations is $100,000.

If the DEQ proceeds with judicial action, civil penalties could be as much as $25,000 a day for Water Quality Act violations or $10,000 a day for Public Water Supply Laws violations, the letter said.

Save Holland Lake, a group that formed to fight the proposed expansion and advocate for a clean lake, discussed wastewater system management in a recent bulletin.

In the update, Save Holland said its members “remained very troubled by the FNF’s (Flathead National Forest’s) judgment in proposing to transfer all wastewater plant management, maintenance and monitoring responsibilities to POWDR (the private Utah company and lodge shareholder) when the FNF knew the plant had a history of excessive leaks and other problems that threatened water quality,” the report said.

“Such a transfer would have allowed further concealment from the public of these ongoing issues and given management responsibility to an entity with strong incentives to maximize revenue by increasing guest capacity and minimizing the costs to the wastewater treatment plant and for the plant’s repair, maintenance and monitoring.”

Earlier this month, the lodge owner announced the deal with POWDR was off, and the partners are looking for a new buyer.

The lodge operates on public land with a special use permit, and it’s possible a different company seeks expansion down the road.

In an email, the Forest Service did not discuss whether a wastewater management transfer might be possible in the future but said it’s not on the table now: “There is currently no proposal for transfer of the wastewater treatment facility at this time.”

Keila Szpaller is deputy editor of the Daily Montanan, a nonprofit newsroom. To read the article as originally published, click here.