An explosive new report underlines the difficulty of regulating private dams, which make up about 64 percent of the nation's 91,000 dams.
Last week, the 95-year-old Edenville Dam in rural Michigan failed after heavy rains, forcing thousands of residents downstream to evacuate. The disaster put a spotlight on the nation's crumbling dam system, especially the fact that it's more difficult for regulators to force private dam owners to make needed repairs.
The Edenville Dam's owners, it turns out, had bought the dam and three others nearby in 2006 as a tax shelter, then fought with regulators for years to avoid having to pay for repairs, taxes, or upgrades to make the dam safer, Mike Wilkinson, Kelly House and Riley Beggin report for Bridge, a nonpartisan, nonprofit Michigan newsroom.
Heirs to William Boyce, a Chicago newspaper publisher and founder of the Boy Scouts of America, managed the fortune as trustees of the William D. Boyce Trusts. In 2006 they decided to reinvest money from the sale of an Illinois property so they wouldn't have to pay $600,000 in capital gains taxes to the Internal Revenue Service, Bridge reports. The two lead trustees, Las Vegas architect Lee Mueller and his cousin Michel d'Avenas came up with the notion to buy four hydroelectric dams near Midland under the name Boyce Hydro Power LLC, which Mueller manages. They took out loans to pay the $4.8 million for the dams.
"In the 14 years that have followed, Mueller and the trust have clashed repeatedly with state officials, federal regulators, local homeowners and even fishermen," Bridge reports.
"Residents who live on lakes surrounding the dams are dubious about the pleas of poverty and accuse Mueller and the Boyce Trust of being absentee owners who for years didn’t invest in repairs," Bridge reports.
Last week, the 95-year-old Edenville Dam in rural Michigan failed after heavy rains, forcing thousands of residents downstream to evacuate. The disaster put a spotlight on the nation's crumbling dam system, especially the fact that it's more difficult for regulators to force private dam owners to make needed repairs.
The Edenville Dam's owners, it turns out, had bought the dam and three others nearby in 2006 as a tax shelter, then fought with regulators for years to avoid having to pay for repairs, taxes, or upgrades to make the dam safer, Mike Wilkinson, Kelly House and Riley Beggin report for Bridge, a nonpartisan, nonprofit Michigan newsroom.
Heirs to William Boyce, a Chicago newspaper publisher and founder of the Boy Scouts of America, managed the fortune as trustees of the William D. Boyce Trusts. In 2006 they decided to reinvest money from the sale of an Illinois property so they wouldn't have to pay $600,000 in capital gains taxes to the Internal Revenue Service, Bridge reports. The two lead trustees, Las Vegas architect Lee Mueller and his cousin Michel d'Avenas came up with the notion to buy four hydroelectric dams near Midland under the name Boyce Hydro Power LLC, which Mueller manages. They took out loans to pay the $4.8 million for the dams.
"In the 14 years that have followed, Mueller and the trust have clashed repeatedly with state officials, federal regulators, local homeowners and even fishermen," Bridge reports.
The Federal Energy Regulatory Commission told Mueller and previous owners since at least 1993 that the Edenville Dam needed to have its flood capacity increased or it could fail. Last week's "flood came 1½ years after federal regulators terminated Boyce Hydro’s license to generate power at the Edenville Dam, citing decades of failures to fix spillways that can prevent flooding," Bridge reports.
Mueller's attorney told Bridge that Mueller would have liked to make the repairs, but didn't have the money. According to Boyce Trust records filed in court, the dams have lost money every year since at least 2016, Bridge reports.
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