Walz Energy faces $10,000 penalty for violations

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Walz Energy is facing a $10,000 penalty from the Iowa Department of Natural Resources for three separate violations that have occurred during construction of the 10,000-head cattle feedlot and biogas operation near Monona.

By Audrey Posten, North Iowa Times

Walz Energy is facing a $10,000 penalty from the Iowa Department of Natural Resources for three separate violations that have occurred during construction of the 10,000-head cattle feedlot and biogas operation near Monona.

In a letter addressed to Walz Energy’s lawyer, Eldon McAfee, Iowa DNR Attorney Carrie Schoenebaum noted that Walz Energy had “engaged in an illegal discharge to a water of the state, violated its National Pollutant Discharge Elimination System (NPDES) permit and its wastewater construction permit. These are violations the DNR takes very seriously.”

Work at the Walz Energy site at 22578 Hwy. 18 began around a year ago, with plans to construct six open front cattle barns, to go with an additional barn already in existence, as well as a feed storage area, concrete transfer pits and a liquid manure storage lagoon with a capacity of nearly 39 million gallons.

Also included on the site will be tanks for anaerobic digestion and methane production. The manure from the 10,000 cattle at the site will be captured, and with the help of the anaerobic digesters, combined with waste feed products to produce natural gas.

Since construction began, local residents have raised concerns about the project, citing its location in the watershed of Bloody Run Creek, an Outstanding Iowa Water. They fear it is and will continue to be a threat to the area’s water quality, not just of Bloody Run Creek, but ground water, as well. Many also felt the project location, in karst topography that’s prone to sinkholes, was unsuitable.

According to the consent order sent to Walz Energy, the project first fell under DNR scrutiny last April. An environmental specialist with the department visited the site and recommended that the facility implement storm water controls. 

Later in the month, the DNR notified Walz Energy that a NPDES permit would be required due to the site’s location and potential discharge to Bloody Run. Walz Energy submitted an application for a NPDES permit in May and, in August, a draft individual storm water NPDES permit was placed on public notice. A public hearing regarding the permit was held in Elkader on Nov. 29. Despite strong public opposition to its issuance, and the project itself, Walz Energy received its NPDES permit from the DNR in January.

Throughout that time, construction at the site continued, even though a wastewater construction permit issued to Walz Energy on Sept. 29 for construction of the wastewater anaerobic lagoon stated “no construction activities shall be initiated unless Iowa NPDES General Permit No. 2 for ‘storm water associated with construction activities’ is obtained from the department if the site disturbance equals to or exceeds one acre.”

On Oct. 11, following several rain events, DNR officials again visited Walz Energy, noting that Bloody Run Creek downstream from the site was “turbid and brown.” According to the consent order, “department staff observed that much of the site had exposed soils, was wet, muddy and had pooled water. At the property fence line, a bale and soil structure dike had been placed by Walz Energy to retain some storm water. Nevertheless, a steady flow of turbid basin water was passing through the structure.” The DNR issued a notice of violation for the discharge on Oct. 24.

Another notice of violation was issued to Walz Energy on Nov. 17, for violation of the wastewater construction permit, as construction of the wastewater anaerobic lagoon had begun prior to obtaining the storm water NPDES permit.

The third notice of violation was issued on Feb. 21, after DNR officials, during a visit at the end of January, observed several deficiencies related to Walz Energy’s storm water pollution prevention plan (SWPPP). According to the consent order, although the SWPPP required that wood fiber matting be used on berms that have a back slope greater than 3:1, there was no stabilization of the slopes. The SWPPP required silt fence on the back sides of temporary soil piles, yet there was no protection on the back side of the temporary soil pile that was adjacent to the site’s large retention basin. The SWPPP required stabilization using disc-anchored mulch on slopes that were less than 4:1, but there were large areas with no stabilization. Finally, portable toilets were observed at the site, even though they had not been mentioned in the SWPPP.

Per the consent order, Walz Energy must cease all illegal discharges to waters of the state, comply with all conditions of the NPDES permit, in the future obtain all NPDES permits prior to engaging in construction activity and pay the $10,000 administrative penalty.

“I am offering your client the opportunity to enter into this agreement as an alternative to the issuance of a unilateral administrative order or referral to the Office of the Iowa Attorney General,” the DNR attorney, Schoenebaum, said in her letter to McAfee, the Walz Energy lawyer. “The DNR agrees to forgo further enforcement if the terms of the consent order are satisfied.”

Jon Haman, Walz Energy’s chief operating officer, assured the above violations have been fixed, and that he plans to meet with DNR officials regarding the consent order.

“The consent order is not final. It is only the department’s original offer to settle the matter,” explained Alex Murphy, Iowa DNR Director of Communications. “For that reason, at this time, it has not been complied with.”

Meanwhile, in response to a letter from over 40 local groups and individuals, the U.S. Environmental Protection Agency (EPA) is backing the Iowa DNR’s handling of the Walz Energy facility.

A letter initiated by the Clayton County Conservation Awareness Network (CAN), and sent to the EPA in February, questioned the DNR’s ability to oversee construction of the facility. It also blasted the DNR for not following its own guidelines or enforcing violations.

The letter sought the EPA’s intervention in determining whether the DNR’s “after-the-fact” issuance of the NPDES permit violated the Clean Water Act, including federal storm water regulations and anti-degradation requirements.

The EPA was also asked to prohibit Walz Energy from commencing operation of the facility unless measures were in place to protect the waters of the state, including Bloody Run and the region’s ground water and aquifers.

After consulting with the DNR and reviewing the DNR’s records, the EPA does not believe the DNR violated any provisions of the Clean Water Act, said James B. Gulliford, the EPA’s Region 7 Administrator, in a response to CAN’s letter.

“Both the EPA and IDNR routinely require facilities to apply for and obtain NPDES permits as the result of unpermitted discharges, and issuance of this NPDES permit does not authorize past discharges,” Gulliford wrote. “Since June 2017, the IDNR has issued three notice of violations for illegal discharges and permit violations and the case has been referred to their legal bureau for additional enforcement follow-up, including ensuring that NPDES permit requirements are met. The EPA will continue to monitor the IDNR’s progress in addressing noncompliance at this facility.”

As for the issue of ground water protection, Gulliford said the Clean Water Act may cover ground water if there are pollutant discharges that are hydrologically connected by ground water to a surface water. He noted the Safe Drinking Water Act can provide some federal authority if the impacted ground water provides source water for a public water system or underground source of drinking water. 

“However, we are unaware of any information indicating that any of these conditions are present at this location,” Gulliford explained.

Gulliford closed his response by stating, “The EPA is working with the state to ensure that appropriate safeguards are in place to protect the water quality of Bloody Run Creek and its tributaries.”

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