It is first mentioned in "Nightmare on Al's Street", with Al claiming he owns about 2/3 of an acre. He was able to buy it with the money that he could have invested in land that eventually became the Sears Tower in 1973 (this would indicate that Al has been investing in Lake Chicamocomico since 1970). He is aware of how toxic the place is, as he mentions that people are still trying to figure out how to keep the plants and animals alive there. He also mentions that the U.S. Army has the land padlocked.
A few years later, when Marcy gave the Bundys $2,000 to host her wedding to Jefferson D'Arcy, Peg and Al cut corners everywhere, keeping the $2,000 for themselves and splitting it for their own uses. Peg bought a plane ticket to Hawaii, whilst Al used his $1,000 to make the balloon payment on his retirement property.
After the abrupt ending for the wedding, Al comes home with a brochure, telling Bud that he the owner of lot 31, across the highway from a view of Lake Chicamocomico. Bud asks Jefferson what he was imprisoned for, he said fraud, specifically for participating in a swindling conspiracy to sell fake retirement property on a toxic waste dump called Lake Chicamocomico. Jefferson said the swindling ring was uprooted and made public news four years prior to meeting Al, and jokes that some of the truly stupid are still sending in payments.
Upon realizing that he has been scammed and now owns a toxic wasteland that is uninhabitable for 5 million years, he eventually realizes that it still beats having to go with Peg to Hawaii. Al has a fantasy about him and Bud actually fishing at Lake Chicamocomico, set to the tune of The Andy Griffith Show. In the fantasy, the pair have already mutated by growing rodent-like tails as they enter the property. Al's right arm then falls off, but they laugh and then he kicks it away. As they finally reach the lake, which is aggressively bubbling with junk floating all over, Al pats his son on the head and ends up gather a large chunk of hair, leaving Bud mostly bald. Despite this, they laugh again and then hug as they look out over the lake.
Lake Chicamocomico was mentioned in "Weenie Tot Lovers and Other Strangers". After appearing on television to claim the Weenie Tot "Scratch-n-Sniff Sweepstakes" prize of $50,000, Jefferson and Marcy are confronted by three IRS (Internal Revenue Service) agents. The lead agent tells the audience that Jefferson will be using the $50,000 prize (along with the watches and bracelet the other agents collect from Marcy and Jefferson) for "partial reparations to the aged and stupid people he defrauded in the notorious Lake Chicamocomico land scandal". Marcy then punches Jefferson and walks off the stage.