Woodlake Dam failure goes to court

CARTHAGE, North Carolina (WTVD) -- The owners of the maligned Woodlake Dam finally had their day in court - and they didn't even bother to show up.

After months of reporting by the ABC11 I-Team, the Attorney General's Office finally filed a court injunction against the development's German ownership team after years of negligence led to the dam's demise. The injunction, filed January 27th, asks the court to demand Woodlake LLC and its chair Illya Steiner either pay to fix the dam - or pay to break down the dam.

At the first scheduled court hearing Monday, a Moore County judge sat dumbfounded as neither Steiner, his attorney, nor local property manager Julie Watson attended the proceedings.

Still, lawyers representing the Attorney General told the court they've been in contact with Woodlake's attorney, Brian Derer, and the parties agreed to a new timeline governing construction on the dam. The consent agreement - whereby both parties negotiate an order - would need the judge's approval.

"Does Ms. Watson know I could put her in jail," Judge James M. Webb snapped to those in attendance. "If a consent agreement is reached, and it receives court approval, it must include this threat."

A second hearing on the consent agreement is scheduled for Wednesday, March 15.

Now months after Hurricane Matthew, the dam remains broken, fully empowering the state to enforce its many dam safety orders and citations issued to Woodlake over the past several years.

The last DSO, issued on November 17, mandated that the Woodlake must have had its engineers begin work on a temporary breach of the dam begin by December 8th and be completed by December 31, 2016. Additionally, the DSO gave the dam owners 91 days from the order's issue for engineers to submit complete plans for the repair of the dam.

According to the DSO, had the conditions not been met, the owners would face fines of up to $500 a day.

A spokesperson for the NC Department of Environmental Quality (DEQ) told ABC11 that Woodlake was given five days from December 8 to provide a written response to the DEQ with an update on their plans and work.

They never happened.

Geosyntec, an international firm with field offices in Raleigh, was originally hired by Steiner to work closely with state officials to fix the maligned dam that nearly failed during Hurricane Matthew. The heroic efforts of the National Guard to sandbag the dam and save hundreds of homes downstream was one of the lasting images from the historic storm.

The firm, however, cut ties with Woodlake earlier this month. Documents obtained by the ABC11 I-Team show Steiner owed Geosyntec more than $270,000.

Internal memos shown to the I-Team revealed even Geosyntec, had yet to hear from Woodlake owner, Dr. Illya Steiner, or its manager, Julie Watson.

An ABC11 I-Team investigation revealed a history of negligence on the part of the owners - German investors Ingolf Boex and Illya Steiner - and a failure on the part of the DEQ to enforce the many DSOs and notices delivered over the past decade.

The dam has also been a problem for those who live downstream; a problem that nearly turned deadly after Hurricane Matthew. The storm exposed the dangers of neglect when crews found a ruptured spillway, forcing the evacuation of hundreds of residents. The National Guard was called in to plug the leak with sandbags.

As the I-Team also reported, the risk of impending breach forced the DEQ and FEMA to bring in pumps to drain the lake and reduce pressure on the failing dam. The result has been the disappearance of Woodlake, which was a desired spot for waterfront properties. The lake was once home to fish, frogs, flora, fauna and many species of birds.


The Woodlake owner and managers have ignored repeated requests for comment.

On the same day our I-Team's report aired, Woodlake hired public relations firm Apco Worldwide to represent them. In a statement emailed to ABC11 on October 28th, spokeswoman Devyn McDonald wrote:

"The safety of Woodlake Country Club residents, members, guests and our surrounding neighbors is our top priority...The interim remedy is intended to rapidly improve the protectiveness of the dam until a final remedy is designed, permitted, and implemented. The final remedy process will require ongoing collaboration with the state regulators until a final solution is in place. We want to emphasize that throughout this process the protection of human safety and the environment are our top priorities."

Despite several requests, McDonald would not answer any questions about the latest DSO or Woodlake's noncompliance.
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