Crisis in Silver Bay

When the Reserve Mining Co. opened its huge iron ore plant in northern Minnesota in 1955, there was no problem attracting labor. Thousands of workers jumped at the promise of high wages, dazzling views of Lake Superior from an attractive company town called Silver Bay, and the good moose and partridge hunting in the area. Now, however, the jobs, the plant and the town itself are in danger of extinction. In a complex court case now in its twelfth week, the Government is suing to halt Reserve Mining from dumping 67,000 tons of ore wastes per day into Lake Superior, charging that it is dangerously polluting the once pristine lake, depleting herring fisheries and releasing toxic asbestos fibers into the water.

Since the case was filed in Minneapolis last year, it has grown into a classic confrontation between economics and environment. Closing the plant, argues Reserve, would idle the company work force of 3,050 and eliminate some 12,000 subsidiary jobs in the region. "The town would simply disappear," says City Attorney Wayne Johnson.

Two decades ago, Reserve Mining perfected its technique for economically extracting iron from a gray rock called taconite, which previously was considered to have too low an iron content for commercial mining and processing. Today the plant, producing 15% of the nation's iron ore, is a solid money-maker for its owners, Armco Steel Corp. and Republic Steel Corp. One reason for the profits: By dumping "tailings," or waste sand, into Lake Superior, the company saves some $25,000 a day over the costs of hauling them to disposal sites on land.

Reserve Mining has been under attack by environmentalists over the dumping issue for six years. A persistent federal biologist named Louis Williams opened the attack by making a 10-month study of the plant's operation on his own initiative. He concluded in a 1967 report that the tailings were not, as the company contended, falling harmlessly to the lake bottom. Instead, he said, they were partially dissolving and releasing into the water nutrients that hasten the growth of algae.

Black Humor. When a subsequent Interior Department report backed up Williams' conclusions, environmentalists all around the Great Lakes began pressuring the state and Federal Government for action. In February 1972 the Justice Department responded by bringing the present suit.

Most worrisome to lakeshore residents was a report by the Environmental Protection Agency last June that asbestos fibers were contaminating the drinking water of Duluth, some 60 miles from Silver Bay. So far during the trial, 22 Government witnesses, including physicians, biologists and chemists, have pinpointed the mining plant as the source of the fibers.

Reserve Mining, which began arguing its defense last month, is expected to present evidence of its own to dispute the Government's 48 claims against it. The company says that the tailings have "no significant adverse effect" on the lake, and that they sink harmlessly to the bottom. Any asbestos, according to the company, comes from streams and rivers around the lake.

All the publicity has generated a climate of fear that takes the form of black humor at the Silver Bay Tavern, where patrons order "bourbon and asbestos." Silver Bay residents know that there are few other good jobs for hundreds of miles around. They are thus fiercely loyal to the company and furious at the Government, the conservationists and the news media. "We don't think there's a health issue," says Mayor Frank Scheuring. "Nothing has been proved yet."

Each side is determined to win. The Government has already spent more than $5,000,000 on the trial, and Reserve Mining plans to call no fewer than 75 witnesses. The trial has become a political whirlpool, and savvy politicians like Minnesota Governor Wendell Anderson are trying to swim clear. Even U.S. District Judge Miles Lord, who is hearing the case without a jury, is feeling pressure. To ensure his own impartiality, he has taken the unusual step of hiring experts to make an independent study of the extent of water pollution and the effects, if any, on residents in the Duluth-Silver Bay region.

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