The McLemore Resort in Rising Fawn is facing a proposed state penalty and a halt on new construction after two raw sewage spills and more than 100 wastewater permit violations, according to a report by WRCB News Channel 3 Chattanooga.
Records obtained by WRCB from the Georgia Environmental Protection Division (EPD) show the McLemore Water Reclamation Facility experienced two separate raw sewage spills due to lift station failures.
The first spill occurred in October 2025, when approximately 60,000 gallons of untreated wastewater flowed into Mill Creek. A second spill followed in January 2026, releasing an additional 9,300 gallons. Together, the two incidents discharged nearly 70,000 gallons of raw sewage into the creek.
According to EPD records cited by WRCB, the wastewater facility has accumulated 112 permit violations since McLemore assumed ownership of the system in 2022. Prior to that, the facility operated as the Canyon Ridge Water Reclamation Facility under the Dade County Water and Sewer Authority.
Records indicate the authority previously agreed to pay a $1,950 settlement in 2019 after exceeding permitted biochemical oxygen demand (BOD5) limits between June and October of that year.
The violations reportedly increased after the Cloudland at McLemore Resort hotel opened in February 2024. Since then, treated wastewater has repeatedly exceeded permit limits for multiple water quality measures, including E. coli bacteria, turbidity, biochemical oxygen demand (BOD), and total suspended solids.
As a result, the Georgia EPD has suspended approvals for new construction projects at the resort until the wastewater treatment system can reliably manage the facility’s flow while remaining in compliance with state regulations. The freeze affects future development, including hotel expansion, golf courses, swimming pools, and event space.
The state has proposed a civil penalty of $111,875 against McLemore for the violations. However, according to the report, the penalty could be reduced or eliminated if the resort’s spending on corrective actions and expansion projects equals or exceeds that amount.
In a statement provided to WRCB, McLemore officials said the resort would “never knowingly discharge untreated wastewater” or “allow a sewage spill to occur.” The statement said the facility complied with regulatory requirements following the incidents, including continued upstream and downstream water quality testing.
The resort also said it inherited an aging wastewater system that had gone years without significant modernization.
“The Sewer Board inherited a wastewater system that had gone for many years without meaningful modernization and required significant rehabilitation,” the statement said. “Since assuming operational oversight in 2022, the Sewer Board has invested in substantial treatment upgrades while also designing and permitting a comprehensive expansion to increase long-term capacity.”
McLemore officials added that the planned expansion has received the necessary regulatory approvals and is ready to move forward once financing is finalized.
The resort said it remains committed to protecting the surrounding environment, investing in infrastructure improvements, and working with regulators and the community to achieve long-term compliance.
This story is based on reporting by WRCB News Channel 3 Chattanooga using records obtained from the Georgia Environmental Protection Division.