Traverse City Record-Eagle

July 23, 2013

Hotel faces delayed opening

BY GLENN PUIT
gpuit@record-eagle.com

---- — TRAVERSE CITY — Construction at downtown's Hotel Indigo could be delayed because additional treatment is needed for polluted groundwater beneath the building site along Grandview Parkway.

“They are progressing well, but they would like to be progressing a little bit faster,” said Jean Derenzy, Grand Traverse County's deputy director of planning and development.

Derenzy said developers were optimistic for a spring 2014 grand opening of the anticipated bayfront hotel project, but it appears the date will be pushed back because officials require additional treatment of cyanide-tainted groundwater that's being pumped from the building site.

"I'm not sure when their new opening date is," Derenzy said.

Developers knew the groundwater was contaminated and required treatment. But high cyanide levels found in the water necessitated additional on-site treatment before shipment to a wastewater facility.

“It was an added component that was not anticipated, and another added cost,” Derenzy said.

The source of the cyanide-laced plume remains under investigation and authorities don't know how far it extends. The Michigan Department of Environmental Quality is studying the cyanide levels, as well as other pollutants. Jeff Schmitz, Hotel Indigo's developer, could not be reached for comment.

County brownfield officials secured a $1 million loan from the U.S. Environmental Protection Administration to address Indigo's on-site pollution. About $620,000 is allocated for soil disposal, transportation and dewatering. The money helps to pay for pumping out and treating groundwater during construction of the building's foundation and underground parking garage.

Susan Wenzlick, a DEQ brownfield coordinator, said agency officials are studying the extent of the cyanide plume. Tests will be conducted at public rights-of-way in an area extending to Garland Street and elsewhere.

Wenzlick said there's suspicion an old coal gasification plant that once operated in the area is to blame.

“One of the bi-products of coal gasification is cyanide,” Wenzlick said.

Derenzy said it's important to have a full understanding of the groundwater contamination -- not just for the Indigo project -- but for other future developments in that area.

"It's a major issue for us because any of those developments on Grandview Parkway next to the hotel will come into the same issue," she said. "We need to address this and not have the same costs associated with every project."