Dredge Report: Port Authority and Army Corps Battle Tooth and Nail for Your Sympathies

Dredge Report: Port Authority and Army Corps Battle Tooth and Nail for Your Sympathies

First, a spot of news and a brief summary: The Cuyahoga River will be dredged very soon, certainly by the end of 2016, at a cost of $3.7 million. After the second consecutive year of intense bickering about when and how the river should be dredged (and crucially, who should pay for it), the U.S. Army Corps of Engineers finally awarded a contract on Oct. 12 to the Michigan-based Ryba Marine Construction Company.

A refresher: The Army Corps is on one side of the local dredging controversy. The Cleveland Port Authority and the Ohio Environmental Protection Agency are on the other. The dispute revolves around the disposal method of the dredged material.

This year, the Corps (via Ryba Marine) will place all sediment dredged from the riverbed in a Port-run confined disposal facility (CDF) along Lake Erie and pay for doing so. They are not happy about this. They would prefer to dump the material directly into the lake, a much cheaper method. It's also the method that the Corps' Buffalo District, of which Cleveland is a part, classified as the "Federal Standard" last year. The Corps has agreed to front the costs of CDF disposal, having been assured that they will be reimbursed for the difference between methods, an estimated $2.1 million, if they win a federal court case against the state of Ohio on the same topic.

The Corps was ordered by the court to initiate the dredging contract after ArcelorMittal Steel filed a 17-page motion at the end of September. The motion delineated the dire economic consequences if the river was not dredged immediately. The Corps is legally responsible for maintaining a depth of 23 feet in the river, which is a Federal Navigation Channel. But for months, it has been much shallower due to shoaling of the riverbed. This meant that commercial freighters had to reduce their tonnage before navigating the narrow 6-mile passage to avoid getting stuck in the mud or damaging their hulls. As a result, ArcelorMittal's raw material inventory was at its lowest level in five years. Layoffs and corporate losses were forecast in catastrophic terms.

Catastrophic terms, of course, have defined the dredging controversy as it has played out in the local press. It is because of these catastrophic terms that Scene felt compelled to take, with apologies, a deeper dive.

***

Even a non-exhaustive reading of the available coverage would yield the following impression: The Ohio EPA and the Cleveland Port Authority are the good guys. They have repeatedly claimed that the Army Corps' open lake disposal method would lead to environmental and economic disaster.

The environmental questions turn out to have vastly different answers, based on whom you ask, and the economic concerns are a function of the controversy itself, not of the disposal method. But potential disaster, and the Corps' sole culpability for it, has been the prevailing narrative, pumped and parroted by politicians and media outlets, Scene among them.

"It would be a sad story for the entire nation," said Ohio EPA director Craig Butler (italics added), in a February 2015 public hearing, "if the 'Walleye Capital of the World' backslid to the point that citizens had to question whether it was safe to eat the fish."

"At every step," said the Port's CEO Will Friedman, in a county council meeting a year later, "[the Corps] has ignored the legitimate concerns of Ohio's policy makers and citizens in what seems like an obsessive quest to dump unsuitable sediments in the lake. This denial [to ban open-lake disposal] flies in the face of the science and the law, which are clear, and once again places at risk the health of Lake Erie and literally thousands of Ohio's jobs."

The dredged material is toxic, the above parties insist, polluted with PCBs, heavy metals, and "other harmful toxins." U.S. senators Rob Portman and Sherrod Brown have been persuaded by the facts and the rhetoric, throwing their weight behind the Port and the EPA. So has the citizenry.

"Please be aware that the EPA is not the bad guy here," posted one online commenter in a piece published by Belt Magazine in May. It was perhaps the only local report that characterized the Army Corps as anything less than the narrative's arch-villain. "The Army Corps is trying to get permission to open lake dump ... and all of the community meetings that have happened do not have any people in support of this. Not the Port, EPA or citizens or scientists."

That's not quite true. Certainly the Corps' own scientists stand by their findings, and have stated that the primary source of the sediment to be dredged is the "upstream portions" of the Cuyahoga River watershed, including the Cuyahoga Valley National Park (a head scratcher, but still). The local media couldn't have painted the controversy any clearer if it were Jedi vs. Sith, and residents have internalized the positions presented to them. At a public meeting about the dredging at St. Ignatius High School in March, most of the residents were indeed skeptical of, if not openly hostile to, the Army Corps' presentation. Port CEO Will Friedman kicked his opposition into the highest gear yet seen.

"Talk about déjà vu all over again," he said. "This is our new rite of spring in Cleveland, fighting the Corps to protect our shipping, jobs, and greatest natural asset. I take no pleasure in saying this, but this is institutional failure of the highest order. I urge decision-makers at the Corps to stop selectively hiding behind your rules and start doing the right thing."

***

Here, we came to a question. The question, in fact. What if the media had the story all wrong? What if, all this time, the Army Corps has been the Jedi, and the Port and EPA have been the Sith, pursuing disposal in facilities along the lake for ulterior motives?

We had come by evidence, all in publicly available documents, that suggested this might be the case, that the real reason the Port was so vocally opposed to open lake disposal was because they stood to make a great deal of money on sediment dredged from the river. They began reselling the sediment for commercial use in construction projects in 2015, after all. That money would disappear if the sediment was dumped back in the lake.

The conspiracy: Dredged sediment was now being viewed as a commodity, as a commercial product. The Port wanted to socialize the harvesting of that product —the Army Corps, since the Water Resource Development Act of 1986 (WRDA) is legally required to dredge, at its own expense, federal waterways — and then, on top of that, charge the Corps a tipping fee to place the sediment in the Port-run CDF 12. The Port then wanted to curate and resell the sediment, sub-contracting the local Kurtz Bros. Construction and taking a percentage.

There seemed to be evidence to substantiate our conspiracy.

For one thing, the Ohio EPA's key environmental argument against open lake disposal — that walleye populations in Lake Erie would be further contaminated by PCBs, thereby affecting the "one meal per week advisory" — didn't appear to be backed up by science. It was all speculation.

"Can I say for sure that [the Corps'] proposal to dispose of contaminated sediment in Lake Erie will be the 'straw that breaks the camel's back' and put us into the one meal per month advisory?" Craig Butler asked in his 2015 testimony. "No, I cannot. But I can tell you that Ohio, the Corps, U.S. EPA and everyone else in this room must do everything we can and not take any unnecessary risks."

When the Ohio EPA visited the Corps' national Engineering Research and Development Center in December 2014, there was a similar lack of justification for their opposition. They "believed" the dredged sediment was toxic; they "believed" it would have an unacceptable impact. The beliefs weren't based on anything.

"When [Ohio EPA scientists] were asked what standard they were applying to reach the conclusion that the placement would be unacceptable," read an Army Corps report after the December 2014 meeting, "they responded that OEPA did not have a standard for making this judgement."

Meanwhile, Corps scientists collaborated on what they described as the "the most extensive and detailed effort to evaluate an individual dredging project in the history of Great Lakes dredging." Their findings concluded that the dredged sediment would create an "acceptably low risk" on the marine life of Lake Erie.

The idea of acceptably low risk, though, or at any rate the verbiage, has flummoxed the Port and the Ohio EPA.

Again from Butler's testimony: "I am sorry, but given the health, environmental and economic consequences at stake, this is not a risk that the Army Corps should be willing to take simply to save money on appropriate disposal."

With contaminants in dredged sediment, there are guidelines prescribed in the Clean Water Act for testing and permitting of dredged material. The Army Corps says it conducted "a suite of physical, chemical and biological tests," and determined the open lake disposal met CWA guidelines and that open lake placement would not result in any "significant or ecologically meaningful increase in PCBs or DDE [dichlorodiphenyldichloro- ethylene] bioaccumulation in aquatic life, including in fish."

It is up to the Ohio EPA then — it is the state's right, as prescribed in the Clean Water Act, to determine what's allowed in its waters — to provide a water quality certification permit to the Corps before they'd be allowed to dispose of the sediment in the lake. The EPA has provided permits in Toledo and Ashtabula, where concentrations of certain contaminants are higher than in Cleveland, via the Corps. There, the Corps is nonetheless permitted to dispose of the material in open water.

In Cleveland, though, the Ohio EPA has only provided a conditional permit which allows the Corps to dispose of sediment in CDFs. This, once again, is the root of the highly public controversy.

What hasn't been public is that the open lake opposition seemed to be entangled at least to some degree in the financial interests of the Port Authority. When Craig Butler testified in February 2015, he mentioned four key areas of opposition to open lake disposal: (1) the Ohio EPA believed the sediment was toxic; (2) they believed the Army Corps was "ignoring key data" to "obtain their desired outcome"; (3) they believed the Army Corp was "inappropriately" requiring the state to pay for alternative disposal; and (4) walleye in Lake Erie were already contaminated by existing PCBs.

But at the meeting with Corps scientists at the Engineering Research and Development facility three months earlier, another key point was mentioned: the business interests of the Port.

click to enlarge The Cuyahoga is so shallow that freighters - kick up mud as they make tight turns - Photo by Sam Allard
Photo by Sam Allard
The Cuyahoga is so shallow that freighterskick up mud as they make tight turns

"The Port of Cleveland has a plan to provide 35+ years of CDF capacity," a public report on the meeting describes. "The financial viability of this plan is dependent on [the Corps] placing dredged material from Cleveland Harbor in the CDF and providing the associated tipping fees. OEPA made reference on multiple occasions to the fact that parties are having to make long-term "business decisions" about management of dredged material from Cleveland Harbor and that uncertainty regarding how dredged material would be managed was complicating these decisions."

That particular argument has yet to be reported in the local press. One explanation: The Port's business interests are a much less popular battle cry than "the health of Lake Erie and literally thousands of Ohio's jobs." At any rate, the Army Corps' response to the financial argument was as follows:

"This argument is not germane to technical considerations as to whether and to what degree dredged material from Cleveland Harbor would have an 'unacceptable adverse impact' on Lake Erie. The Federal Standard is established as the least costly, environmentally acceptable, practicable alternative. The Port of Cleveland CDF plan is just one of several alternatives that would be considered in establishing the Federal Standard."

And indeed, it was considered. But the Federal Standard, via the Corps, assuming no harm is done to the environment, must be the least costly plan. CDF disposal is much more expensive than open lake disposal chiefly because of the tipping fees. (About $2.1 million's worth.)

"What's crazy is that the Corps of Engineers does this in other harbors, placing sediment in non-Corps-run CDFs, and those people don't charge us a tipping fee," Andrew Kornacki, public affairs chief for the Buffalo District, told Scene. "The way they make their money is they have an endless supply of material to sell. And they sell it. They don't try to make money on the Corps on the front end, and then sell it on the back end and get twice as much money."

Kornacki also noted something of a double standard. The Port markets on its own website the improving cleanliness of dredged sediment.

"Not only can CDFs cost tens of millions of dollars and take up large areas along the lakefront," the Port says on its site, "but sediment dredged from the Cuyahoga River has become cleaner. In 2011 the Ohio Environmental Protection Agency determined that dredged sediment could be used on industrial and commercial sites — such as brownfields that needed to be capped — setting the stage for new ways to use sediment."

The Port gave some examples of beneficial re-use in a 2012 newsletter.

"Sediment now placed in [CDFs] could be used to cap brownfields, create aquatic and upland wildlife habitats, nourish beaches, combine with other material for roadway construction, or fill the basements of demolished houses."

Beneficial re-use is the long-term plan nationwide, especially as states are now banning open lake disposal — it will be illegal in Ohio starting in 2020 — but Andrew Kornacki asked how the Port and EPA could talk of PCB levels in dredged sediment on one hand and then talk about using that same sediment for things like aquatic habitats and beach nourishment on the other.

"To say that the sediment's not suitable for open lake placement, but it's okay for someone's basement?" Kornacki said. "Open lake placement, that's not okay, but putting it near the shore, that's fine?"

In February, the Corps crystallized its position in a letter to Lake Erie stakeholders. After listing problems with sediment samples that the EPA had collected — the test samples were gathered from locations outside the channel, it said, and the testing methodologies didn't adhere to CWA guidelines — Buffalo District commander Karl Jansen proposed a "win-win" solution to the controversy.

"[The Corps] could complete the 2016 dredging requirement at Cleveland Harbor by placing all sediment into the [CDF] that the Port of Cleveland operates (CDF 12), provided that the Port waives its tipping fee or identifies an entity willing to reimburse the Port for its fee," Jansen wrote (italics added). "If this occurs, Ohio will obtain the benefit of the dredged material it seeks for use and U.S. taxpayers benefit because other Great Lakes harbors and national harbors will be dredged consistent with [the Corps'] dredging plan."

Said Kornacki, summing up the hostilities: "This disagreement that we're having should be based on science, but it's not."

***

Au contraire, said the Port of Cleveland, in a two-hour meeting with Scene at their Warehouse District Headquarters. CEO Will Friedman, sediment management director Jim White and communications chief Jade Davis refuted or clarified the above points one by one, effectively deconstructing our conspiracy.

In the first place, for absolute clarity, said Will Friedman, "the notion that we would go through all this effort — suing the federal government, spending money on engineering studies, improving our CDF, starting up these operations — just so we could entrap [the Corps] in a tipping fee scheme, I think that's kind of preposterous. It's a red herring. We're not trying to make money on this."

Friedman put the controversy in the context of the Water Resource Development Act, which says that the Army Corps is responsible for 100 percent of the cost of dredging and disposal. That's just the law. If new capacity is constructed — say a new CDF — the cost is split with a local non-federal sponsor: 75 percent federal, 25 percent local. Operating costs are 100-percent federal.

"We wanted to flip the relationship on its head," said Friedman (referencing conversations that were happening back in 2012 and 2013). "Instead of the Corps building a facility and operating a facility, we wanted to do that. We were in a better position to do that. We're local, we're on the ground. We said, we'll provide this to you — we gave them all the engineering and specs — and all you'll have to do is pay us a tipping fee based on recouping the 75 percent of the federal cost."

Not only is that arrangement authorized in Section 217 of WRDA, it was agreed upon by the Army Corps. The Corps' assistant secretary Jo Ellen Darcy, in a letter dated Oct. 1, 2014, approved a short-term dredged material management plan (DMMP) in which the Port would pay for the costs of design and expansion of CDF 12 up front (roughly $31 million) and would recover that capital investment, and ongoing operating costs, by charging a tipping fee.

Incidentally, one of the three conditions Darcy mentioned in her approval letter was that a memorandum of understanding "must address the fact that open lake disposal is currently unlikely to be accepted as a method to dispose of 80 percent of the dredged material in any new proposed 20-year DMMP."

"It wasn't just us," said Friedman. "Nobody involved in this process thought going back to open lake disposal — which was the pre-Clean Water Act method — made sense. The algal bloom problems in the Western Basin, the fact that other states have banned open lake disposal ... this was not the future."

And yet, less than three months after Darcy's approval letter, via federal court testimony from Army Corps navigation chief Jeffrey McKee, the Buffalo District determined that the federal standard for the upper reach of the Cuyahoga would thereafter be open lake placement.

"We all got blindsided," said Friedman. "This happened with no prior discussion at our task force meetings."

In the more recent back and forths, the way that the Army Corps has been framing the tipping fee arrangement — and the way we framed it above — is either disingenuous or completely false, according to the Port. Here are three specific examples:

One, the line that the Corps is pursuing open lake disposal, the cheapest method, to save money "for the American taxpayer," isn't quite accurate, said Friedman. The Corps' budget is allocated by Congress from a pot of funds generated by something called the Harbor Fund Maintenance Tax.

"It's a tax paid for by anyone receiving cargo, so ArcelorMittal would pay on the value of the iron ore it receives," Friedman said. "It's closer to a user fee. This isn't general treasury dollars going into this Harbor Maintenance Trust Fund. In my opinion, it is disingenuous to say [that the Corps is looking out for the American taxpayer]."

Two, the Corps' assertions (mentioned above) that they aren't charged tipping fees in other harbors simply isn't true. In June of 2001, the Detroit District of the Army Corps entered into a similar tipping fee agreement with Brown County, Wisconsin, to dispose of dredged material from Green Bay Harbor. In 2012, the Baltimore District of the Corps entered into a tipping fee agreement with the Maryland Department of Transportation. The Corps often cites Duluth Harbor as a model for Cleveland to emulate, but Duluth is a "meaningless and misleading comparison," if you ask the Port.

The CDF in Duluth, owned by the local Port Authority, was built by the Corps and maintained by the Corps.

"In such a case there would be no basis for non-federal interests to charge a tipping fee as there are no non-federal costs," reads a Material Management FAQ published by the Port in March.

Three, the notion that the Port is trying to make "twice as much money" by charging the Corps a tipping fee on the front end and then selling the material on the back end is also untrue. Money earned on the sale of dredged material goes toward defraying the operating costs of CDF 12. And if operating costs go down, the tipping fee goes down commensurately.

"This is all in the agreement," said Friedman, dismayed. "When the operating costs go down — if we're able to sell some of the material in the market, or if we get better at maintaining it — we rebate that back to the Army. We can't make money. We're advancing the funds, and the Corps knows this ... . Until the court tells us otherwise, we're not going to waive our tipping fee because that's tantamount to us saying, 'Okay Corps, we'll pay for everything.' It's the same as just writing a check. All we're trying to do is recover the costs."

The environmental conclusions drawn by the Army Corps are even more egregiously dishonest, said the Port, as are the implications that the controversy is more about the Port's business interests than the local economy and the environment.

"We've done this purely out of our belief that it's part of our mission to keep the shipping channel functioning, and to be protective of Lake Erie and its ecosystem," Friedman said.

Jade Davis added: "We wouldn't even operate a CDF at all unless it was environmentally necessary."

And the notion that the EPA is manipulating data to achieve their desired outcome — the Army Corps noted flaws in the EPA's samples and their testing methodologies, recall — is hypocritical. Jim White said the biggest problem the EPA had with the Army Corps' testing was the background material they tested in Lake Erie for comparison. (This has been reported.)

"The USEPA/USACE testing manual requires that you compare your sediment to undisturbed lake bottom," White explained, "and the Corps went and compared to previously dumped-on areas [what's called CLA-1, the so-called "Toxic Blob"], and said this is cleaner than that."

It's just not a legitimate basis for comparison, White said.

Furthermore, the EPA should have taken samples from the edges of the riverbed, said Jade Davis. "As a regulatory agency, they should be preparing for the worst possible outcomes."

"The Corps wants to cherrypick," said White. "They only want to sample the clean stuff. They only want to grab from the middle and from the top, but the sediment is not homogenous. No one ever thought this stuff would be suitable for open lake placement."

And White quickly explained the Toledo and Ashtabula comparisons above. In Ashtabula, the sediment being disposed in the open lake itself comes from the lake. It's not introducing new contaminants into deep water. Toledo is more complicated. There, the contaminants are very different. They're not PCBs. They're fertilized nutrients that have binded to the sediment. And while there's concern that the material may be exacerbating the algal bloom crises in Lake Erie's Western Basin, it's not a PCB problem.

"Furthermore, there's no place else to put it right now," Friedman chimed in. Toledo generates more than three times the material that Cleveland does. "They don't have the alternative. The EPA would rather not issue that permit but they also don't want to shut down the port."

Cleveland, of course, has a perfectly viable alternative that was developed with Corps approval over the past several years.

So is the debate, as the Corps suggested, no longer about science, Scene asked?

"You could say that it's about federalism," said Friedman. "This is the federal government saying, 'We don't like it when the state gets to say no to us.' But that's how the Clean Water Act was written. There was clear legislative intent. Our view here at the Port, and frankly it's international treaty, is that we don't introduce new toxins into the lake. It's just a bad practice. And anyway the Corps wants to spin it, even their data says there are PCBs in these sediments."

Looking ahead at the federal case, the state of Ohio will argue that the Corps doesn't get to self-certify. In fact, the Clean Water Act explicitly anticipated situations like these.

So even if it costs more to dispose of sediment in CDFs?

"Fine, okay," said Friedman, a Jedi knight after all, "then that's what it costs to keep people and the environment safe."

About The Author

Sam Allard

Sam Allard is the Senior Writer at Scene, in which capacity he covers politics and power and writes about movies when time permits. He's a graduate of the Medill School of Journalism at Northwestern University and the NEOMFA at Cleveland State. Prior to joining Scene, he was encamped in Sarajevo, Bosnia, on an...
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