Yellowstone Club developer to pay $1.8 million fine for alleged wetlands violations

By Patrick Davis, Lone Peak Lookout, Aug 12, 2004

Yellowstone Club developer Tim Blixseth has agreed to pay a $1.8 million fine in a settlement with the Environmental Protection Agency for alleged wetlands violations.

The settlement, which still needs final approval from a federal judge after a public comment period, was reached Monday after three years of negotiations and stipulates that the Yellowstone Club will have to restore five acres of damaged wetlands along the exclusive millionaire club’s Big Sky property and reconstruct 1.5 acres of new wetland habitat where repair is impossible. New culverts will also have to be installed where roads cross streams in order to allow fish to pass upstream. EPA scientists will monitor the progress of reparations at the club for at least the next five years.

The EPA first accused the Yellowstone Club of violating the Clean Water Act in 2000. According to John Wardell, director of Montana’s EPA office in Helena, there were “up to 60 separate violations” on the Yellowstone Club site.

“They placed fill in (federally protected) wetlands, and where properties went up, dredged materials were dumped into streams,” Wardell said. “We think the violations are serious enough to warrant the large fine.”

To some extent, Stephen Ross Brown, a Missoula attorney representing Blixseth, agreed.

“Ultimately, the Yellowstone Club feels this settlement is in their best interest, and the United States does too,” Brown said. “The Yellowstone Club is committed to environmental compliance in the future.”

In addition to the alleged dumping, there was also severe erosion along a ski hill that could channel pollutants downstream into the Gallatin River, according to Assistant U.S. Attorney Leif Johnson.

“Our goal is to protect the watershed and try to prevent high sediment loads from being dumped into streams,” Johnson said. “Regulations are set up so contractors and developers will seek the necessary permits, so negative impacts on the environment can be avoided. It’s better to have the government on board when doing work around waters of the U.S.”

Brown said the alleged violations occured “due to different interpretations of how the rules apply.”

“This was very early on in the construction, it’s nothing recent,” he added. “The Yellowstone Club has not admitted to the violations. There were no concessions of wrongdoings. We want to put this behind us and move on.”

The confusion over the application of environmental laws and building permits may have occurred before construction at the Yellowstone Club began, according to Kris Knutson, an environmental biologist for the EPA. Knutson said the U.S. Army Corps of Engineers visited the property with Blixseth in August of 1995, after the private ski hill and golf course were proposed.

Knutson said a Corps representative met with Blixseth again in 1996 to discuss Section 404 of the Clean Water Act, which regulates the dumping of dredge or fill material into U.S. waters.

“They would say they didn’t know,” Knutson said. “Our position is they should have known. There was plenty of information provided to (Blixseth) and his attorney to make them aware.”

By settling the case, Blixseth avoided a trial in a federal court, where more serious sanctions could have resulted. The $1.8 million fine is the largest ever for such wetlands violations.

Earlier this summer, Blixseth agreed to pay the state of Montana $231,000 to settle accusations by the Montana Department of Environmental Quality that the Yellowstone Club had violated state water law and was polluting streams that feed the Gallatin River. He also admitted no wrongdoing in that case.


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