How restoring an estuary will help restore a crucial part of the past

On a recent March day, over 300 local residents spent their Saturday morning at Heritage Park learning about a project that will restore a historic estuary and improve the environmental health, public safety, and aquatic habitat of the area in and around Capitol Lake. Throughout the afternoon, the team led more than a dozen tours that offered detailed explanations of the project. Small tour groups gave participants more extensive time to ask questions and start dialogue with project leads. And, given the high turnout, the team managed to lead multiple tours at the same time.

Many locals have never seen the dense Olympia area exist without Capitol Lake at its center; they don't know that the mouth of the Deschutes River exists within the heart of the Capitol. That's because more than 70 years have passed since this waterbody went through such a large change. In the 1950s, the state built a dam at the mouth of the Deschutes River to turn the estuary into a freshwater reflecting pool, which is what we experience today. However, building the dam and creating the lake unintentionally caused a domino effect on the environment that worsened with time, negatively impacting the health of a once vital and culturally important waterway.

By the early 1970s, the lake suffered from chronic water quality impairments, excessive sediment deposits, algal blooms, and overgrowth of invasive aquatic plants. With each passing year, multiple studies identified that the impacts of the dam have continued to worsen and the need for action has become more urgent. While the state landed on the long-term management approach in 2022, finding the right solution started decades before and involved input from dozens of government agencies, local entities, Tribes, elected officials, and members of the public. The Squaxin Island Tribe, in particular, has been an important partner throughout this process.

Bobbak Talebi, project team lead and Ecology's Southwest Region director, said this project is the solution that offers the most benefits.

"This project will transform the area for generations to come," Talebi said. "After years of collecting data and conducting this research, we know how important it is to remove the dam. This solution came from decades of hard work, compromise, and partnerships. Together, we created a vision that not only addresses urgent environmental problems but will better connect us to a healthier environment. We're not just restoring an estuary - we're restoring an identity."

What's Ecology's role in the project?

The Legislature transferred the Deschutes Estuary Restoration Project from the Department of Enterprise Services (DES) to Ecology in 2025. As of July 1, 2025, Ecology has led and managed this project, which is among the largest estuary restorations of its kind in an urban area. The agency will continue to work in close partnership with other interested entities and groups to restore the estuary and complete a massive restoration of waterways, habitat, and infrastructure. This includes maintaining transparent information sharing through updates on our website and sharing recurring project newsletters. We will continue to host events (similar to the recent walking tour at Capitol Lake) as we complete the project design process.

Ecology will continue collaborating with DES, the Squaxin Island Tribe, and other partners, including the City of Olympia, City of Tumwater, Thurston County, Port of Olympia, LOTT Clean Water Alliance, and various state agencies to advance the effort.

What was the landscape like before the lake existed?

Made up of 260 acres, the estuary lay at the mouth of the Deschutes River. Before Capitol Lake existed, the Deschutes River could freely flow into Budd Inlet (which is the southern end of Puget Sound), forming a rich estuary where freshwater and saltwater mixed and provided habitat and healthy environments for tide flats.

This project is within the traditional lands of the Squaxin Island Tribe. The Deschutes River, Percival Creek, and their estuaries historically provided abundant fishing and hunting opportunities for salmon, shellfish, and other resources, including beaver, waterfowl, deer, elk, bear, and many other species. Historically, a Steh-Chass village was located along this shoreline. Steh-Chass houses and canoes once lined the beach, and Coast Salish peoples from throughout the region traveled to this area to trade.

Scott Steltzner, environmental manager for the Saxon Island Tribe, said the project will help restore the area to a healthier reality.

"The Deschutes River has the potential to be far more ecologically productive than it is today," Steltzner said. "Restoring the estuary would address the shallow, warm-water conditions that contribute to ongoing water quality problems while reestablishing a key producer of fish, particularly salmon, in South Puget Sound."

In the early 1900s, the project area became home to other waterfront communities, maritime industries, and recreational uses. Before the 5th Avenue Dam was constructed, vessels could make their way two miles up the waterway and to the base of Tumwater Falls. The accessible waterway supported local industry, including the Olympia Brewing Company and the timber trade.

What specific problems exist?

More problems than benefits have plagued Capitol Lake, and these problems have worsened over time. For example, invasive species shut down any water access or recreation more than 15 years ago. Officials have recorded continued water quality issues over the years, which impact the levels of oxygen that aquatic and marine life need. Salmon and forage fish - a key part of the Squaxin Island Tribe's culture and history - have declined without healthy estuary habitat. And some areas in and along the lake have seen sediment build up as high as 13 feet, impacting the health of the environment.

Where are we in the design process?

Some of the design complexities come from the project's location in a dense, urban area that has transportation infrastructure, a working waterway, recreational amenities, nearby businesses, and regional utilities.

Ecology hit an important design milestone December 2025 when the consultant project team submitted the 60% design to us. Being at "60% design" means the design team has refined elements of the project design plans to develop more accurate costs, reduce costs further, and allow design to be far enough along so we can submit permits to agencies for review. At this stage, the design is detailed enough to understand what will be built. The next milestone design will further refine these details before we provide final construction documents to the contractor.

The project's design partners and the state are currently evaluating this design package, and the project team will incorporate any input into the upcoming 90% design milestone in late 2026. During "90% design," the design is further polished to confirm the final specifics for construction activities. This includes adding greater detail on design drawings, selecting construction materials and methods, and verifying permits and code compliance.

As part of future construction, workers will remove the 5th Avenue Dam and replace it with a 500-foot-wide opening. Doing so will reintroduce tidal flow and connect Budd Inlet to the Deschutes River, as well as ease traffic and improve safety in a way that aligns with the city's bike and pedestrian plans.

This action came from a 2022 decision that would resolve water quality impairments and increase community recreational use of the area. A safer and more up-to-date roadway will replace the 5th Avenue Dam than where the original dam is located today. During 2026, the public could have more in-person opportunities to learn about the project.

How will the restoration benefit the area?

There are many reasons why restoring the natural estuary will change the landscape and area for the better. Among many things, the new design will:

• Create a wetland habitat favorable to wildlife that advances recovery for coho and chinook salmon, as well as orcas.
• Restore a landscape that holds cultural and spiritual significance to the Squaxin Island Tribe.
• Incorporate a new 5th Avenue Bridge with separate lanes for vehicles, bicyclists, and pedestrians.
• Protect environmental health by improving water quality and reducing cleanup costs.

More information

To see the full list of project benefits, please visit the Deschutes Estuary Restoration Project website. For more information on project planning and design, please visit the project's frequently asked questions page.