Michigan lawmakers to fed regulators: You blew it on Edenville Dam

Michigan senators blasted federal regulators Tuesday for the failure of the Edenville Dam, expressing shock that their solution to repairing a dam with decades of safety issues was to turn oversight over to a state with less stringent standards.

During a joint committee meeting held with three top officials from the Federal Energy Regulatory Commission, Sen. Ed McBroom, R-Vulcan, was incredulous that the agency claimed it could “shock” Boyce Hydro into repairing the dam by revoking its license to generate electricity in 2018.

Since 1999, FERC had sought to force Boyce and a prior owner to expand the dam’s capacity to handle major flooding. Neither owner complied.

“So for safety purposes FERC no longer manages this dam and you say ‘well we want to shock them into doing [the repairs,]’ ” McBroom asked. 

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“So to shock them you turn them over to another agency that has a lower threshold?”

Michigan has one of the least stringent standards in the nation for dams like Edenville. It is half of what FERC required prior to revoking Boyce’s license in September 2018.

The dam and another one owned by Boyce failed during heavy rains on May 19, causing $200 million in damages to more than 2,500 homes in Midland, Gladwin and Saginaw counties.

The hearings follow a host of lawsuits, including one from the state against Boyce, and come amid a state investigation and inquiry from Congress about the dam’s failure. The state House also plans a hearing on Wednesday.

Records show federal regulators cited the dam for decades over safety issues, but they didn’t believe it was on the “verge of catastrophe” when the license was revoked, said Dave Capka, FERC’s director of the division of dam safety and inspections, told the panel.

John Katz, a deputy general counsel for FERC, told senators the commission has only a few tools to force compliance, including civil penalties and revocation.

But though the “vast majority” of dam owners comply or respond to the threat of penalties and revocation, Katz said FERC never leveled penalties because Boyce had said it did not have the money. 

Katz said that levying fines would have been like “getting blood from a turnip.” Boyce had submitted more than 10 plans over the past decade for repairs estimated at $10 million and never followed through.

Sen. Rosemary Bayer, D-Beverly Hills, was blunt in her assessment: “So it sounds like [FERC] really has no actual enforcement capability at all. Is that right?”

“The commission tried just to do everything it possibly could to get this [company] to comply with safety regulations,” Katz said. 

“The commission doesn't have its own bulldozers and construction equipment. It can't fix things by itself and the sense at the commission was that rather than have us waving our finger it might be more effective for the local authorities who are on the ground and in the project area to improve things.”

Sen. Winnie Brinks, D-Grand Rapids, said FERC needed more tools, like forcing dam owners to have insurance, or be better vetted prior to buying a dam.

“Couldn't we as a Congress and as a nation require that owner to have a certain amount of either insurance in order to even purchase that kind of facility and operate it could we alternatively say if you do not comply you will be required to sell it to somebody who is willing to comply,” Brinks asked.

A day before the hearing, FERC told Congress that it did not review Boyce Hydro’s finances before it bought the Edenville Dam and three others in 2006 because they bought it out of foreclosure from Wolverine Synex power company.

None of the three FERC officials who participated in the hearing could say whether the agency was aware that Michigan’s standards are less stringent. 

State officials have said they couldn’t access details of the dam’s licensing issues with FERC because they were sealed.

“Whether it met Michigan’s [standards] or not,  that is up to Michigan to do their own assessment and analysis,” Capka said. “We can't determine that it meets their requirements or it doesn't but you know, we certainly determined it did not meet ours.”

Court papers have indicated Michigan officials knew since last fall the Edenville Dam didn’t meet state standards. State officials have said they were awaiting an overdue engineering report to conclude as much when the dams failed.