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LONG DAM WAIT: Now that lake is filled, homeowners hope lakeside loop will reopen

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The shores of Osceola Lake attracted walkers, joggers, bicyclists and bird watchers even with a dry bed. Now that the lake has refilled, the scenery is much improved.

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“Lake Osceola is awesome,” said Jean Saden, who recently moved to a home on Virginia Avenue. “It’s a little gem. You can bike, walk dogs along the lake, and it’s safe.”
Bicyclist Joe Simmons has been enjoying rides around the lake for more than eight years.
“I probably do 10 miles each time I come out here,” he said. “I like the lake road because it’s flat.”
Pat Chambers, who lives in nearby Devonwood, was enjoying a stroll around the lake recently. “People drive down here all the time to walk the lake,” she said. “They just park their cars along the road.”
Once upon a time, bicyclists could click off the laps on the 1.6-mile loop around the 32-acre lake and walkers could make their way around unobstructed. (Some sneak by the barricades now.) But now, even though the dam owner has completed repairs the state required, the road over the dam remains blocked off.
“It’s not fair to school buses, garbage trucks and mail carriers,” Chambers said. “It’s been going on forever.”
When “forever” ends is up to an
administrative law judge in Raleigh
who is presiding over a complicated long-running dispute involving the state Division of Energy, Mineral and Land Resources (DEMLR), Osceola Lake owner Todd Leoni and the NCDOT. One option state regulators favor, would require the owner to drain the lake again.
The NCDOT owns and maintains North and South Lakeside drives, which circumvent the lake. The road over the dam has been closed for four years. A big orange detour arrow and metal gates topped with barbed wire greet people who drive into the neighborhood. Work to repair, repave and reopen the road is at the mercy of state regulators and Leoni, who don’t agree on whether the dam repair meets state specifications.
The detour takes some residents a mile or more out of their way. For safety reasons, the state removed many large trees that grew along the old roadbed but they are waiting on Leoni to complete road work on each side of the now repaired dam. DOT contends that when the owner gets the road bed in “an acceptable state of maintenance,” the state can pave it, install guardrails, and reopen it. Leoni, who contends he’s already done what the state required, expresses aggravation at the regulatory impasse.
“I don’t care if the road stays closed forever,” he said. “I’ve done my job but they haven’t done theirs.”

Dam deemed ‘high hazard’

Since 2004, the DEMLR has cited Leoni, a Miami businessman, for deficiencies in the 30-foot dam. In 2014, regulators ramped up the pressure on Leoni to make the needed repairs. The agency issued a dam safety order with action deadlines and followed by court action. Among the deficiencies were cracks in the 93-year-old structure and trees in the spillway that could be dangerous if the dam was breached. The structure was deemed “high hazard” because failure could threated lives and property.
More than a year passed before an engineer was found to design the repairs. In March 2016 DEMLR, the NCDOT and Leoni sign a settlement agreement under which Leoni committed to repair deficiencies and DEMLR committed to tree removal and other site work. In late 2015 the lake was drained in preparation for the job.
Attorneys for DEQ and DOT would not comment on the case because the matter is still in litigation, now into its fifth year. Leoni said the new dam poses no public safety risk. In the most recent court filing, attorney Craig Justus argued on Leoni’s behalf that the options for draining the lake to fix the clogged drain are impractical and prohibitively expensive.
“The fact that the lake has remained full, or near fall, is not the result of any act” by Leoni, Justus said. Record-setting rain has done the job. “Even moderate or typical rains can quickly fill the lake, open drains notwithstanding.”
Leoni and his crews have explored several options for unclogging the drain or draining the lake, Justus said. Sending a diver down is considered too risky. Removing a section of pipe between the original intake system and a coffer dam “would allow the dam to work as originally designed” but would possibly discharge “an unknown amount of silt for an unknown amount of time” downstream. The owner also has looked into using large pumps to assist the drains. In the fall of 2018, responding to demand caused by hurricanes Florence and Michael, suppliers shipped all their pumps to Eastern North Carolina. “Moreover, with likely rain events, the likelihood of success over a finite period of time is greatly diminished,” Justus said in the court filing.
Justus estimates the monthly cost of using at the pump at $21,450, counting pump rental, fuel and labor, after a setup cost of $7,750. A used 12-inch pump would cost $55,000 to $65,000, he said, and Leoni would still have fuel and labor cost. And, given a normal rain event, he “would be faced with a full lake after having spent tens of thousands of dollars.”
Leoni argues that there’s no public safety issues. He asks for help from dam safety personnel to identify “reasonably feasible options to lower the lake for an inspection.”

Great flood washes away original dam

The original earthen dam that created Osceola Lake in 1908 was washed away by the Great Flood of 1916. Developers replaced it in 1926 with a concrete dam. About that time Osceola Lake Park was platted with 400 narrow frontage lots. Over time, a road was built over the dam and water lines extended. Today, there are some 200 homes in the “greater lake community.”
The historic Osceola Lake Inn,
also built in 1908, overlooked the lake and boasted a private beach. The
hotel, long-owned by the Rubin family, was sold in 2004 to Miami businessman Ed Hernando, who renovated it for lodging and events
and renamed it the Copper Crest Inn. In 2016, after years of neglect, the
hotel has a new owner and a new life as the Heartwood Refuge & Retreat Center.
“We’ve nursed it back to life,” said Amy Goldweber, who manages the retreat and its 50 rooms. Guests come from far and near to study, among other things, the teachings of Buddha.

In late 2017, Leoni pitched the property with two picnic areas to Henderson County for $3 million. The offer was quickly rejected.
“We had just spent money on recreation projects and we had school funding to think about,” said Commissioner Bill Lapsley, a retired civil engineer. “For me, the lake was such a large area plus with the dam there was a liability issue.”
Leslie Wynne who is the treasurer of the Osceola Lake Property Owners Association, said she would like to see something positive done in the lake community.
The association has about 200 members but few who pay the $100 annual dues.
“Our meetings are poorly attended unless there is an issue that would cost more money,” she said. “Maybe 10 percent of us would support a tax district to acquire the lake.”
Brenda Coates, a retired professor who owns the Brandy Bar on Seventh Avenue, has lived along the lake for
30 years. She said its depth has
been reduced to as little as two or three feet in some places because of sediment.
Coates, who is active in the property owners group, thinks Leoni may have gotten a bad deal from DOT.
“It’s not his road,” she said. “It’s the state’s road to fix.”
Vance Street resident Steve Simpson lives just out of sight of the lake. “We’ve had this house in our family since 1961,” he said. “It’s a great area. We’re in the county but we’re so close to town.” He’s optimistic about the future of the neighborhood. “I think it’s going up.”
He may have reason for a sunny outlook.
The refilled lake has a profoundly positive effect on property values. Tonya Cochran, a realtor with Coldwell Banker King, said that after the lake refilled in 2018, property values spiked by some 30 percent.
“Even with the road still closed,” Cochran said, “that area in the last nine months has seen a number of sales and listings are on the rise.”