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In Unalaska, a dirty fight over clean water

Jill Burke
Acting on behalf of the U.S. Environmental Protection Agency, the Department of Justice is threatening to wring more than $158 million out of the Aleutian Islands city of Unalaska for allegedly dumping sewage pollutants into the Pacific Ocean. Aaron Jansen illustration

A small island fishing community 800 air miles southwest of Anchorage has found itself in a monster of a fight with federal enforcers based more than 4,100 miles away, in Washington, D.C.

Acting on behalf of the U.S. Environmental Protection Agency, the Department of Justice is threatening to wring more than $158 million out of the city of Unalaska. It claims the city has for years dumped sewage pollutants into the Pacific Ocean and now wants a federal judge to not only force Unalaska into compliance but also impose up to $32,500 per day in fines, even more -- up to $37,500 per day -- for the most recent violations.

Before the Justice Department filed its lawsuit against Unalaska, city leaders pleaded their case to the Alaska Legislature, looking for money to help end the pressure they were under. They also brought with them a warning: Unalaska might be the first Alaska community wrestling with an unyielding regulator, but what if it isn't the last? Unalaska's bureaucratic tangle could be a signal of what's headed to other small, remote communities: financially devastating enforcement of a one-size-fits-all federal water policy that doesn't apply well to the realities of life in rural Alaska.

At issue is Unalaska's wastewater treatment system, which, according to the Justice Department, isn't working as effectively as the law requires. If it were, the city wouldn't have a failed track record over six years of putting more pollutants, including toilet waste, into ocean waters than the law allows.

"People are making this assumption that the city of Unalaska is dumping untreated sewage into the bay, which is of course untrue. It's ridiculous," said Unalaska Mayor Shirley Marquardt in a recent interview.

The federal Clean Water Act, which the EPA enforces, prohibits the discharge of pollutants into waterways without a permit. Unalaska has had a permit for years, which restricts the volume of pollutants -- including sewage, chemical waste and industrial waste -- that can be released daily, weekly and monthly. From 2004 to 2010, the Justice Department alleges Unalaska violated those levels more than 4,800 times, and that in 16 of the months it allowed too much fecal coliform bacteria to pass into South Unalaska Bay. The bacteria are microorganisms that live in the intestines of humans and animals.

While fecal coliform bacteria has the potential to carry human disease, the civil complaint filed by the Justice Department makes no mention of whether the alleged violations constituted a specific risk to human health.

The bacteria themselves aren't necessarily harmful, but if they are present, then other bugs -- bad, illness-causing ones -- might be present as well, according to Karsten Hueffer, an assistant professor of microbiology at the University of Alaska's Institute of Arctic Biology in Fairbanks.

Fecal coliform is considered a marker for fecal contamination. If it's present, other organisms, including pathogens, could be, too.

The EPA declined to comment, referring questions to a spokesperson for the Justice Department, who also declined comment because of the pending litigation. The EPA also declined to attend at least one legislative hearing held in Juneau this spring on the situation, to the disappointment of state lawmakers, who had a chance to listen to and question city leaders from Unalaska, an attorney from the Alaska Department of Law and a deputy commissioner from the Department of Environmental Conservation.

Depending on what type of wastewater treatment system the city will need to bring online, it will cost the city at least $11 million and possibly as much as $24 million, according to Unalaska City Manager Chris Hladick. The city also needs to build more space at its landfill, which will be an additional $9 million. Although they are separate facilities, the landfill and the wastewater treatment plant affect each other, he said.

Water that travels through the landfill must be diverted to the water treatment plant, and if the water plant is upgraded to the standard the EPA wants, it will in turn create a new flow of sludge that will have to be deposited in the landfill. Now, on top of these costs for pollution-control upgrades, Unalaska faces the looming possibility of being dinged with fines that far exceed the cost to fix or upgrade their facilities.

Marquardt and other city leaders aren't quite sure how the situation got so bad after years of trying to work with, not against, the EPA. And they're frustrated with how the EPA has treated them over the years -- making "do-it-now" demands on upgrades that take time and millions of dollars to achieve -- and which may not even be the best way to fix things, Marquardt said.

"There is just no reason to take a big stick and hit us over the head with it when we are saying 'Hey, we are trying to work on this, stop hitting us,'" Marquardt said.

A new plant already obsolete and a big error the EPA won't fix

Part of the problem, Marquardt said, has been the interchange of cause and effect between the city's landfill and its wastewater treatment plant, and the unfortunate circumstance -- a numerical error -- that caused the $3.5 million treatment plant, built in 1999 and brought online in 2000, to become outdated within just three years. That happened, she said, partly because at that time the city also needed a new landfill, which the EPA required to be built in a way that allowed runoff from rain and snowmelt flowing through the landfill to be captured and processed at the wastewater plant. The added volume of metal-laden water taxed the plant's capabilities.

Ultraviolet light bulbs at the water treatment plant help kill fecal coliform, but the bulbs' effectiveness are diminished by runoff, which is loaded with metals picked up as it passes through the landfill's containers. The metals, like iron, coat the bulbs. The treatment plant, Marquardt said, "was never designed for heavy metals. We were told to do it so that's what happened."

Then, in 2003, the city had to reapply for its discharge permit. And in the process, the Department of Environmental Conservation, which prepared the permit, made what it calls a "substantive mistake." Whereas the previous permit required Unalaska to remove 30 percent of the organic material contained in wastewater, the new permit erroneously demanded that the city remove far more of the material -- 70 percent.

Organic materials suck oxygen from the ocean as they break down, and if they overload an area, can cause "dead zones" inhospitable to fish and other marine life.

State environmental regulators told the EPA they had screwed up, but for reasons unknown the EPA never modified the bad numbers, Dan Easton, a DEC deputy commissioner, told Alaska lawmakers during a February hearing on the Unalaska situation. At the meeting, Easton and Hladick rehashed for a legislative subcommittee the bind the city is in.

Further complicating the situation, in 2004 a problem also cropped up with another federal agency, the U.S. Fish and Wildlife Service, which was concerned that the permit didn't evaluate the impact of the wastewater outfall on the Steller's eider, a bird listed as threatened under the Endangered Species Act, Hladick said at the hearing.

"It's like a switch went off in 2004," he said of the declining relationship between the city and the EPA.

EPA's stern approach

In hearings before the Legislature and in a recent interview, Unalaska Mayor Marquardt describes the EPA's enforcement actions as overly burdensome and compliance demands impossible to achieve.

She and Hladick went to lawmakers to forewarn them, and to ask for help -- money -- getting out of the mess. Unalaska sought $7 million to partially pay for upgrades, and intended to seek an identical amount from the federal government. The city planned to somehow cover the rest of the costs.

Building new facilities is expensive. The city would rather fund infrastructure in support of the fishing industry, but instead feels bullied into sinking everything it has into satisfying the EPA's demands. Ultimately, they said, city residents will bear the financial brunt, with water bills potentially increasing some 170 percent to 200 percent to fund the upgrades, reaching $150 a month.

"EPA is not basing its position to require this new treatment on human health or safety," Marquardt said. "It seems to be primarily an issue of forcing Unalaska to comply with national standards and guidelines."

When the EPA started looking for and chronicling violations, Unalaska tried to negotiate a settlement. The terms were basically for the city to admit to violations, make some changes and adhere to a compliance schedule, but "unfortunately at the last minute that settlement offer was revoked," Easton testified.

In the last few years, EPA has taken things a step further by getting the Justice Department involved, he said.

State environmental regulators wanted to intervene, but were repeatedly rebuffed by the EPA, Easton said, who went on to characterize the most recently failed negotiations as involving a Justice Department offer to reduce fines if Unalaska would build a more advanced treatment plant than it currently needs.

By June of this year, Unalaska found itself without a settlement and on the receiving end of a civil lawsuit that could expose it to more than $158 million in fines.

According to Marquardt, along the way EPA took a decidedly adversarial stance in its dealings with the city. At one time, when a settlement was close and the city was to hold a meeting to finalize the deal, a volcanic eruption disrupted flights and prevented Unalaska's city leaders from getting to the meeting. But EPA, according to Marquardt, was unsympathetic. Refusing to give extra time for the meeting to take place, the agency told city leaders "you missed the deadline," she said.

"Things just really ratcheted out of control from there," Marquardt said.

Another time, when city leaders succeeded in getting EPA officials to visit Unalaska and its facilities first hand, they received a chilly reception. Again, Marquardt thought the visit was in the spirit of negotiations, but when a pile of lawyers and enforcement agents showed up, it became clear they were in for some trouble. "They literally got off the plane and instead of shaking hands and introducing themselves, they flashed badges and said they were here to do a surprise inspection of our facilities," she said.

After combing through the landfill and the wastewater treatment facility, the inspectors found nothing wrong, Marquardt said.

In the last year, the Justice Department sent Unalaska a letter demanding that within 90 days it come into compliance by financing, designing and constructing a new water plant -- a completely unrealistic demand, according to Marquardt. "It is physically, humanly impossible for us to do what you are asking us to do to," Marquardt said she explained to the agency, adding "and by the way, guys, it's based on mistake."

Complicating the situation is the city's need to again expand its landfill. An advanced water treatment plant will create sludge that will have to be deposited in the landfill, space for which must be created, she said. It all comes down to time, money, and trying to project what in the long run is really the best solution -- modifying the existing water treatment plant or building a new, mechanical one that will cost more to construct and operate.

"The more I have read up on the Clean Water Act and I understood the agency's goal and the power and reach it has as a federal agency, it does not matter that a mistake was made. It does not matter that we would have to clean out our bank accounts," Marquardt said. "All of these things don't matter. If they want to play hardball they can because they have the law behind them."

An issue lurking in the background

The state is also named as a defendant in the case but is not at risk for having to pick up the tab on any fines, according to assistant Attorney General Cameron Leonard. And the state isn't necessarily siding with its embattled city in the Aleutian Islands.

"There may be some value in the state attempting to act as a neutral facilitator; it's not like we agree on every point," Leonard said.

But while Unalaska may be forced to deal with its own mess, there is concern that precedent the situation sets could have a ripple effect on Alaska's rural villages. Mayor Marquardt has voiced this concern, echoed by Rep. Bob Herron at a hearing this spring: "It wouldn't take much for the EPA to come stomping on Bethel or any other community because of a mistake."

"We are here today to let everyone know that this is going on," Hladick said at the same hearing. And, "these other communities should be aware of what's going on and the possible ramifications for Bethel, Kotzebue, Nome -- they're huge."

Most of the state's small and remote villages rely on a single or double pond sewage lagoon, generally understood as a primary treatment process -- one that removes waste by allowing it to settle to the bottom of the pond, with any runoff being diverted to either a drain field, into a river or to the ocean, according to Bill Griffith, a facility programs manager for DEC. Griffith manages the programs that fund and build Alaska's waste treatment systems.

Systems that pull more solid waste out of the outflow are considered secondary treatment systems. Sometimes this can be achieved by adding a chemical process to a treatment pond. But the only way to guarantee a secondary level of treatment is achieved is to build a mechanical plant.

"These are big package treatment plants that require a lot of money to build and a lot of money to operate," Griffith said.

Given enough money and expertise, it would be preferable to have secondary treatment, Griffith said. Currently, about 76 small villages in Alaska operate under certain exemptions from the Clean Water Act. DEC is tasked with overseeing these communities and their respective discharge permits, but there is confusion about what level of authority DEC has to approve the permits.

If a community has a secondary treatment plant, DEC is allowed to approve the permits. But who permits the simpler treatment facilities in smaller communities?

EPA may decide that it alone can approve sewage lagoons and other, lower level treatment options. The state's environmental regulators disagree. And the implication is that EPA, which has caught Unalaska in its sights, might take similar action in other communities that have no ability to comply with stricter requirements it may choose to enforce.

"That is the bone of contention between the EPA and DEC, and it is lurking in the background of this case," Leonard said.

Currently, DEC claims to have "primacy" over the exemption list. EPA transferred control to the state agency over all discharge permits for small villages, meaning the state gets to work with and facilitate permits and compliance for all of the communities, except for one: Unalaska.

Because the EPA had started enforcement actions on Unalaska prior to the transfer of oversight authority, Unalaska was held under EPA's jurisdiction.

An end in sight?

It is likely that even without the initial math error on Unalaska's last permit the city would still have committed some violations of the Clean Water Act, according to Marquardt, Easton and others. But the volume of infractions would have been far less, they said.

The city knows it must deal with the fecal coliform issue, and has in recent years come up with various options -- upgrades or new facilities -- to get that done, depending on what EPA regulators ultimately require them to do.

Marquardt feels it is important to point out, though, that while the city has racked up what appears to be a string of egregious violations, its output to the ocean of oxygen-consuming organic matter is small compared to others that discharge into the bay.

The city is allowed to release 2,700 pounds per day into a "mixing zone" -- an area of water large enough to dilute the material to the point where it does no harm, she said. Compare that, she said, to the 196,000 pounds per day of fish and crab pieces that one of the local seafood processers is allowed to dump and the overall impact should be clear.

"Nobody is killing the bay, and that's the point," Marquardt said.

It isn't clear how a city that has had to ask the Legislature for money to help fund new facilities the EPA says it needs will come up with the cash to pay off a federal fine that could exceed the cost of those projects many times over. While the case moves forward, Unalaska and the state hope they'll yet reach a settlement.

Marquardt wishes the standoff could be resolved with the the EPA and Justice Department actually listening to what she, DEC and others have being saying for years: "You don't have to scare the snot out of us. You’ve got our attention. Could we get yours?"

Contact Jill Burke at jill(at)alaskadispatch.com