MIDLAND (WWJ) – State officials have released new findings in the investigation into the 2020 dam failure that left Midland and the surrounding areas severely flooded.
Attorney General Dana Nessel’s office announced Thursday that Boyce Hydro – the former owners of the Edenville Dam – ignored warning signs of the catastrophic flooding a decade before it happened. Her office filed a motion for summary judgment on behalf of the Department of Environment, Great Lakes, and Energy and the Department of Natural Resources.
The east embankment of the dam failed on May 19, 2020, sending a surge of water downstream that resulted in catastrophe for the surrounding communities. But through the discovery process, the state uncovered “key facts previously unknown to the public.”
Back in 2010, Boyce Hydro determined that the east embankment of its dam might fail if Wixom Lake rose too high, according to Nessel’s office. The company could have fixed the defect, and even made preliminary plans to do so, but “neglected to ever follow through.”
It was that precise part of the embankment that failed in May 2020, “just as the new evidence shows Boyce Hydro had predicted internally back in 2010,” officials said.
The AG’s office says there’s no indication Boyce Hydro told the federal government – which regulated the dam at the time – about the defect and it never divulged the defect to the state after the federal government passed regulation to the state in September 2018.
Investigators with the AG’s office also discovered Boyce Hydro’s former dam safety engineer and chief operator resigned in protest in May 2017 because Lee Mueller – the person managing Boyce Hydro from his home in Las Vegas – “routinely neglected basic dam safety priorities.”
Mueller instead “prioritized expensive and unproductive side projects,” including trying to hold a music festival at the dam or trying to transform the dam into a marina or RV park. Mueller also allegedly purchased a sawmill and large amounts of unnecessary heavy equipment, and tried to develop a residential neighborhood, according to investigators.
The chief operator finally left when Boyce Hydro “used its staff and resources to try to dig a pond off-site rather than repair a major safety defect inside the Sanford Dam.”
The chief operator testified that he tried to persuade Mueller that he was “in the hydro business now, you got to pay attention,” but Mueller allegedly responded that “I’m not in the hydro business . . . I’m in the money-making business.”
"The Edenville Dam failure was a devastating tragedy for thousands in that community, and these new revelations clearly show that failure began at the very top of Boyce Hydro,” Nessel said, per a press release. “We discovered an unconscionable disregard for safety and dam integrity that cost the community that relied on the security of that dam immeasurably, and it’s important we share this with the court today.”
The AG’s office says the company “made a vigorous attempt” to keep this enforcement action from moving forward, waging an “aggressive, months-long effort” to persuade the U.S. Bankruptcy Court for the Eastern District of Michigan to prevent the state from pursuing Boyce Hydro in court.
But those attempts were unsuccessful and once the enforcement action was underway, Mueller “fought the discovery process at every turn,” and tried to keep the 2010 evaluation a secret, according to Nessel’s office.
His refusal to obey the federal court’s discovery orders was so brazen that it “astonished” the judge and led that court to default Mueller for his “bad faith” and “contumacious conduct.”
If the court grants the state’s motion filed Thursday, Boyce Hydro will be dismissed from the case.
That’s because the bankruptcy process Boyce Hydro initiated allows the state to establish the culpability of Boyce Hydro for the failure of its dam, but “correctly channels any funds left in Boyce Hydro’s estate to the flood survivors whose homes and businesses were destroyed due to Boyce Hydro’s mismanagement of its dam.”
If that happens, state officials will then pursue a default judgment against Mueller personally, whom the court has already determined is at fault for the dam’s failure.