GRAND LAKE ST. MARYS — Ohio’s largest inland lake is now Ohio’s biggest environmental headache: What to do about the smelly, toxin-producing algae that is killing off both fish and tourism?

The second algae outbreak in two years is a species never seen in the lake before and the worst in its history, residents say. Three toxins found in the water led state officials to issue a “no-contact” warning Friday, June 25, that will be in effect over the normally busy July 4 weekend and possibly for weeks.

Gov. Ted Strickland on Friday asked the federal government for economic and environmental assistance to help the troubled region.

Business owners are struggling. Since March, Brenda Manning’s marina and bait shop has gone from eight full-time employees to four while Stanley Grimm’s third-generation family restaurant, Behm’s, hasn’t made money in two years. “Who’s going to come here knowing the lake is like this?” Grimm said.

By Wednesday, thousands of dead fish had been removed and cooler, breezy weather had offered a reprieve from the worst of the stench. But the lake’s stubborn challenge remains — farm run-off that feeds the algae and chokes the lake of oxygen.

Top officials from the Ohio Department of Natural Resources and Ohio Department of Environmental Protection say there is no quick fix and no easy solution, even for the long run. Under state and federal laws, officials say they can’t do much beyond seeking voluntary compliance from farmers to improve field management and create run-off buffers.

The next step, mandatory compliance, “is a political mine field,” Manning said. New regulations would pit the lake’s $160 million tourism industry against the $675 million farming industry in Mercer and Auglaize counties.

Even so, “all options are on the table right now,” ODNR Director Sean Logan said.