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Before the Lake was used for boating and recreational purposes, it was planned as a drinking water reservoir but never used for this purpose. In order to create the lake, a dam was constructed on Wallenpaupack Creek at Wilsonville. The land of Wilsonville and the surrounding area in the valley was purchased by PPL from about 100 owners at about $20 an acre and most of the property was razed or moved. Some houses remained, and as the valley was flooded the water was so clear that one could see the houses under the water. Seventeen miles of roads and telephone poles were rerouted, and Purdytown cemetery had to be relocated. The former town of Wilsonville now lies under the water near the dam.