Yellowstone Club agrees to record fines

By SCOTT McMILLION, Bozeman Daily Chronicle, August 10, 2004

Yellowstone Mountain Club developer Tim Blixseth has agreed to pay a record-breaking penalty of $1.8 million for allegedly violating federal environmental laws at his millionaires-only resort south of Big Sky.

The Environmental Protection Agency and the U.S. Department of Justice announced the penalty Monday. Blixseth admits to no guilt, but has agreed to pay the money, plus repair damaged wetlands or create new ones on the property.

The settlement must be approved by a federal judge, after a public comment period.

The alleged violations took place in 2001 and earlier, according to Kris Knutson, an environmental scientist with EPA, and consisted of dumping fill or dredge material in federally protected wetlands and streams on a golf course and the Pioneer Mountain ski runs.

There also were serious erosion problems, according to Assistant U.S. Attorney Leif Johnson.

“We have pictures and videos of erosion gullies four or five feet deep” on the ski hill, Johnson said Monday. “All that goes in the Gallatin River.”

Downstream fish, aquatic life and river users are affected by that pollution.

Johnson said there were at least 60 violations on the sprawling property. The $1.8 million penalty is the largest ever assessed for this type of wetlands violation, Johnson said.

Knutson said the size of the penalty was calculated based on the knowledge club officials had of federal laws, the money they made by proceeding without permits and other factors.

Knutson said Blixseth met with U.S. Army Corps of Engineers officials in 1996 to discuss permits the club needed.

“It shows awareness on their part of needing to get permits,” she said Monday.

“We look forward to [Yellowstone Mountain Club] becoming a responsible corporate citizen and an advocate for the protection of Montana’s wonderful natural resources,” U.S. Attorney Bill Mercer said in a press release.

Yellowstone Mountain Club advertises Montana’s natural amenities on its Web site stating “It’s the dazzling Montana countryside that defines Yellowstone Club,” and urging people to imagine “miles of snow chilled streams, along with hundreds of wild rainbow trout all to yourself.”

Mercer said he wants developers to know “they had better ensure compliance before rather than after development has begun.”

Steve Brown, Blixseth’s lawyer on this matter, stressed that no guilt has been admitted. He said there was disagreement over what constituted a violation, but his client decided not to go to court.

As in many cases, “you have to decide if it’s better to settle or better to litigate,” Brown said.

The parties have been negotiating a settlement for over a year. In addition to the penalty, Yellowstone Mountain Club must repair damages on at least 60 sites, if possible, and if it can’t be done, the lost wetlands must be replaced elsewhere on the property.

That will require hiring hydrologists, botanists and other specialists to make sure the wetlands can perform their function of filtering water for downstream humans and wildlife, Johnson said. It’s a big job in an alpine environment, he noted.

The plans for that work fill several hundred pages, Brown said.

The club also must pay for a specialist to monitor that work for the next five years.

Blixseth earlier this summer agreed to pay the state of Montana $231,000 to settle accusations of polluting streams that feed the Gallatin River. Blixseth did not admit to any guilt in that case either.

Blixseth opened The Yellowstone Club after consolidating his holdings in the Big Sky area by trading land with the federal government in 1998.

Along with some partners, in 1992 he had purchased 160,000 acres from Plum Creek Timber Co., property that had been scattered in a checkerboard pattern across the Gallatin National Forest.

Only members, guests and employees are allowed past the gate at the 13,400-acre club, and prospective members need to prove they are worth at least $3 million.


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