Algae laced its water last year. Today, it’s clear and flows through lush, twisting banks peppered with wildflowers.

With a $3 million price tag to reroute more than three miles of stream, the largest creek restoration project ever at Lake Tahoe Basin is a success, with groundwater, vegetation, fisheries and wildlife all on the rise, project managers say.

“The water looks just incredible,” said Russ Wigart, an engineering technician with the City of South Lake Tahoe, which owns the wetland. “All the vegetation on the banks is growing like crazy.”

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The bulk of the work on Trout Creek, a 70-acre wetland between Pioneer Trail and Martin Avenue, was finished last summer.

The stream was channelized in the 1880s to make way for Lake Valley Railroad, a service that moved lumber from Meyers to Bijou.

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The restoration project aims to repair damage created because the creek was moved and straightened. Resulting changes in the creek made the surrounding meadow drier and decreased the creek’s ability to sustain wildlife and hold soil.

Most of the old creek acted like a shotgun, digging the channel deeper each year and firing sediment and nutrients to Lake Tahoe, where declining clarity is a problem. Sections of the channelized creek ran 25-feet wide and 5-feet deep, said Jim Haen, a civil engineer and project manager.

The new creek sits on a plane 3 1/2 feet higher than the old one. The extra elevation allows better distribution of water in the meadow and has produced thicker vegetation that will, in theory, keep sediments and nutrients out of the lake.

The higher, narrower and windier creek almost overnight made groundwater in the meadow rise. Since the restoration work, it has risen 2 to 3 feet.

The refreshed wetland has been key to the success of the project. It allows vegetation to better reach the water, flourish and attract more insects and wildlife, said Victor Insera, wildlife and stream restoration specialist at California Tahoe Conservancy.

But change takes time, and it may take years before water quality improvements can be linked to the project. Monitoring of water at the site is paid for until 2006, but could continue longer depending on the city’s budget, Wigart said.

Frequent turns in the new creek also created pools of water that work well as fish habitat. The project involved the transport of about 10,000 fish from the old channel to the new creek; about 3,000 of those fish, mostly trout, were shocked unconscious to ease the trip, said Matt Kiesse, fisheries biologist at River Run, a business in Truckee.

The number of fish in the stream seems to have increased since the restoration work.

“I think it’s had a real positive effect. The meadow is recovering nicely and actually improved from raised, standing water,” Kiesse said. “All signs are pointing to it being really successful.”

The restoration project, which began in 1999, has been a controversial one.

About seven homeowners on Ormsby Drive no longer have a creek flowing past their backyard. Instead they have a filled creek bed where grass planting has been rough going.

“It’s really ugly,” said Suzanne Giguere, an Ormsby resident since 1997 of the area where the creek once was. “It’s exactly what we expected.

“I still don’t think they needed to move all of the creek. The new creek is eroding, the bank is falling in.”

Project managers point to the banks of the creek, which solidified quickly because they were made with stacked sod taken from the wetland, as indicators of the project’s success.

Giguere and other residents affected by the changes in creek attended city council meetings all last summer to fight for their rights. They gained some concessions.

The plan at first did not call for contractors to fill sections of the old creek along Ormsby. But after voicing concerns about standing water and a possible mosquito increase, the city agreed to fill those sections of the creek, as well as eliminate plans to dig seven “micropool” pits to provide wildlife habitat. In the end, contractors dug 11 of the 18 planned habitats, none along Ormsby.

“They’re going to have a hard time convincing me that’s environmentally sound, to leave standing water that close to houses,” Giguere said. “There’s going to be water there absolutely every summer.”

Residents of Plateau Circle, on the side of the creek opposite of Ormsby, fear the pools and channels with standing water will increase the mosquito population, a worry especially troubling with the West Nile virus headed this way.

“They left all the mosquito ponds, they didn’t fill them in,” said Mary Ann Helmen. “We’ve got so many mosquitoes here already. Now we’ve got the West Nile virus coming in. I think it’s pretty dangerous.”

Mosquito concerns have prompted the city to add a Phase IV to the Trout Creek Restoration project. Three specified sections of the old creek will have 6,500 cubic yards of extra soil dumped into them starting Sept. 15. The sections are north of Cold Creek and adjacent to Plateau Circle. The rest of the channels and pools with standing water will remain as habitat for wildlife, Wigart said.

Neal Niederman has lived full-time at Plateau for two years. Mosquitoes aside, Niederman said he feels like he had no say in the Trout Creek project because he lives in the county and the land is owned by the city.

“We don’t have an opinion — at least one that matters,” Niederman said. “It looks nice, and I’m sure it’s helping silt control OK, but if they had any real guts, they’d do something about the Tahoe Keys. They are dumping all kinds of pollutants into the lake.”

Tahoe Keys property owners funded $1.2 million of the restoration project through water quality building fees. The fees were collected by the Lahontan Regional Water Quality Control Board. The project was also paid for by the Bureau of Reclamation, which contributed $1.3 million, the California Tahoe Conservancy, which added $425,000, and the Tahoe Regional Planning Agency, which put in $100,000.

Brian Eakin, a battalion chief at Lake Valley Fire Protection District, lives on Plateau Circle opposite Niederman. He couldn’t see any part of the creek before the restoration; now he can glimpse its water from his front lawn.

“I’ve never seen that meadow as lush as it is now,” Eakin said. “It looks great.”

Haen, the engineer who did most of the dirty work, said it’s probably the best project he will ever be involved in.

“It looks like something the Washoe Indians saw 200 years ago,” Haen said. “I think the predominant factor was raising the groundwater 2 feet. It’s a huge success, but still to be determined. It’s only been one year and it hasn’t seen a big winter.”

— Gregory Crofton can be reached at (530) 542-8045 or at gcrofton@tahoedailytribune.com