A chemical plume left behind by a long-shuttered dry cleaner near the Y in South Lake Tahoe has spread across an estimated 400 acres underground, and the current and former owners of the property are now proposing to pay $4.1 million toward treating and monitoring the region's drinking water for the next 59 years.
The contamination traces back to tetrachloroethylene, commonly known as PCE, a solvent used for dry cleaning clothes and degreasing metal from the early 1960s through the mid-1980s, before federal and state environmental agencies listed it as a probable carcinogen and toxic pollutant amid toxicity concerns in the late 1980s, according to South Tahoe Now. The chemical entered groundwater at the former Lake Tahoe Laundry Works site at the South Y Center, a property now home to Raley's and other stores. Eleven years ago, PCE was found in two municipal wells and three private domestic wells in western South Lake Tahoe, and the plume has since extended from the old dry-cleaning site toward Lukins Brothers Water Company and Tahoe Keys Property Owners Association wells, and toward the lake itself.
By 2019, the plume sat 26 to 52 feet thick and between 140 and 180 feet below the surface, the outlet reported. The contamination has previously been described as having caused the closure of five water wells — two Lukins wells and three Tahoe Keys wells — though an earlier 2018 report described the split differently, attributing three of the affected public wells to Lukins Brothers and two to TKPOA. Despite the long-running contamination, drinking water in the area has remained safe, per the same reporting.
Who Is Paying and Why Now
Seven Springs Limited Partnership and Fox Capital Management Corporation, identified as the former and current owners of the property, are the parties behind the proposed settlement. Under its terms, they would give local drinking-water providers $4.1 million for PCE treatment, long-term monitoring and other system improvements, and would fund groundwater treatment as needed for both Lukins Brothers Water Company and Tahoe Keys Water Company. The deal is also meant to provide monetary compensation to water purveyors for past and ongoing impacts to their supplies.
Ben Letton said the agreement marks a major step toward addressing legacy contamination from the site's dry-cleaning history, and that the proposed settlement should reassure residents that their drinking water is safe now and will remain safe in the decades ahead. The settlement's stated goal is to ensure continuous access to safe drinking water for thousands of South Lake Tahoe residents and businesses who rely on the affected wells.
A 59-Year Monitoring Commitment
The proposed agreement would require the property owners to treat municipal drinking-water wells and address pollution affecting the Tahoe Valley South Subbasin for a full 59 years. It calls for a monitoring network of wells designed to catch elevated PCE levels before they reach municipal supply wells, paired with continued source remediation at the original contamination site using soil vapor extraction and targeted groundwater treatment.
None of this takes effect automatically. The settlement still needs approval from the Regional Board, which the outlet notes can only accept or reject the proposal as written — it cannot modify its terms. The Lahontan Regional Water Quality Control Board, which started investigating the contamination and has held several public meetings on the issue over the years, previously issued a cleanup and abatement order describing the effort as a step toward requiring action on PCE contamination impacting municipal supply wells across two water districts, according to the Lahontan Regional Water Quality Control Board, which named Seven Springs Limited Partnership, Fox Capitol Management Corporation, Bobby Page's, Inc. and Connolly Development, Inc. as responsible parties.
A Contamination Fight Years in the Making
The plume's reach into South Lake Tahoe's water supply isn't new. Back in July 2014, Lukins Brothers placed two municipal wells in standby mode after detecting contamination, and the South Tahoe Public Utility District stepped in to supply water to Lukins customers while those wells were offline, according to the Sierra Sun. A 2018 report also noted that PCE had first turned up in South Lake Tahoe drinking-water wells near the Y back in 1989 and remained in the groundwater, even as crews had already pulled 900 pounds of PCE from near the Laundry Works site, with more removal still needed.
Public comments on the newly proposed settlement are due by the November 20 deadline, giving residents a narrow window to weigh in before the Regional Board takes up the matter at a future meeting.
