The Milltown Dam at the confluence of the Clark Fork and Blackfoot Rivers near Missoula, Mont., will be removed, returning the rivers to their original flow by 2009, according to an agreement reached this week.

The folks over at Environmental Economics recently ran a post connecting such dam removals with cost-benefit analyses, pointing to a Time article, archived but available in PDF here.

The case of the Milltown Dam has an interesting additional layer to it, as the dam is also the largest Superfund site in the country. Toxic waste has piled up behind the dam as a result of mining in the area, to the tune of 6.6 million cubic yards of contaminated sediment. Some waste will be completely removed while the rest will remain and be controlled at the site.

Strangely enough, $5 million of the $286.5 billion highway bill will be used to finance a park at the site, according to a New York Times article this morning.

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