The U.S. Department of Justice, on behalf of the U.S. Environmental Protection Agency, and the California Department of Toxic Substances Control, filed a complaint today seeking more than $22 million to recover past cleanup costs at the Lava Cap Mine Superfund Site in Nevada County, Calif.

The complaint, filed against alleged former owner and operator Canadian-based Sterling Centrecorp Inc., and current owners Stephen P. Elder and Elder Development, Inc., seeks past and future costs associated with cleaning up mine tailings and waste rock, collecting and treating contaminated water from the mine, and diverting the flow of clean surface water around contaminated tailings. Consistent with its policies, the EPA sought to resolve this matter prior to filing the complaint, without success.

"Taxpayers are still paying for the legacy of the California gold rush -- the contaminated land and water remain long after the gold was taken out and continue to pose a health risk," said Keith Takata, the EPA's Superfund Division director for the Pacific Southwest region. "We took action to clean up the mine waste that posed a risk to people and the environment, and now we're taking action to recover the taxpayer's money."

Before filing today's complaint, the EPA and DTSC successfully reached an agreement with Newmont Capital Limited and Newmont Mining Corporation of Canada Limited -- two associated corporations that acquired the mine from 1983 – 1986, in a failed attempt to reopen the mine. The settlement, which addresses a portion of the cleanup costs, is pending before the U.S. District Court for the Eastern District of California.

The Lava Cap mine, located 5 miles southeast of Nevada City, Calif., began gold and silver mine operations in 1861. From 1934-1943, the mine was one of the largest gold mines operating in California -- producing approximately 300-400 tons of ore a day. The mine was shut down in 1943 by Executive Order from the War Production Board, which prohibited production of non-strategic metals during World War II.

The mining operations resulted in waste rock and a mill tailings pile at the site. Mill tailings, also known as rock flour, are extremely fine-grained materials with high concentrations of arsenic that are easily suspended in water and susceptible to being carried downstream. In January 1997, the upper half of the log dam built on the property to hold the mill tailings in place collapsed -- discharging over 10,000 cubic yards of arsenic-contaminated tailings into Little Clipper Creek, which spread downstream to Clipper Creek and Lost Lake and accumulated in the sediment and surrounding soil.

The EPA conducted a removal action in 1997 and 1998 to address the tailings release, stabilize the remaining tailings pile, and improve drainage. The Lava Cap Mine site was placed on the Superfund National Priorities List in January 1999. The NPL is the EPA's list of hazardous waste sites potentially posing the greatest long-term threat to public health and the environment.

Between April 2003 and February 2004, the EPA relocated two households, including a family with children, who were tenants of Elder and living in the mine area on or near large tailings deposits. As part of that same response action, the EPA also provided temporary drinking water filter units to residents who were drinking arsenic-contaminated water above the acceptable federal level. The agency continues to seek land-use restrictions from Elder to prevent future residential use of the most impacted mine area parcels.

The EPA recently issued its cleanup plan to address the arsenic-contaminated drinking water wells, which will be implemented in 2009. The EPA also expects to issue its proposed plan in 2009 to address the large tailings deposited over one and half miles downstream of the mine.