Minneapolis may halt water filtration project to slow rate hikes

In a move that would dampen water rate hikes in Minneapolis and seven suburbs, the city is moving to cancel a $90 million water filtration upgrade.

A staff recommendation would end work on the planned Fridley ultrafiltration plant, originally budgeted at far less than the expected cost. The move was endorsed by a City Council committee on Tuesday.

The cancellation would remove the biggest cost factor driving up city water rates, although they're still expected to rise. Minneapolis was poised to spend $18.5 million this year alone on the project.

The plant would have served as the companion to an ultrafiltration plant the city put in service in 2005 in Columbia Heights. Ultrafiltration is a membrane technology for removing cryptosporidium and other water-borne microorganisms that can cause illness, as happened in a 1993 outbreak in Milwaukee.

The main factor allowing the city to halt the project is a federal determination that the city will not need to remove as high a percentage of microorganisms as originally thought when planning began. That's based on an analysis of the raw water the city draws from the Mississippi River. The existing 1925 plant will be able to handle the needed filtration, according to Shahin Rezania, city water works director.

That allows the city to cancel the project, whose costs have risen by $23 million over initial estimates made in 2004.

"The ratepayers will be appreciative," Council Member Sandra Colvin Roy, who chairs the committee, told Rezania.

Aborting the plan will carry a cost: The city has already sunk $4 million into designing the plant, and the equipment supplier could seek up to that amount as a penalty for canceling the city's contract, Rezania said.

The anticipated costs of the ultrafiltration plant were a major factor driving up water rates from $2.75 per 100 cubic feet last year to a projected $3.42 in 2012. Water rates were as low as $1.65 per 100 cubic feet in 2000.

Canceling the plant will reduce the increase in water prices, Rezania said. "It definitely will have an impact on that. How much I don't know." The city sells water to parts of Bloomington and Edina, plus Columbia Heights, Hilltop, Golden Valley, Crystal and New Hope.

The Columbia Heights plant forced up water charges so much that the latter three suburbs revolted. They explored drilling wells to supply themselves, and relented only after a negotiated agreement was reached with Minneapolis.

Although the ultrafiltration plant is the largest capital project in the water department by far, the demands of keeping up a drinking water system that dates to 1872 have been expensive.

Rezania said that although federal microorganism filtration requirements turned out not to be as high as were anticipated when the city began planning for ultrafiltration in the 1990s, the Columbia Heights plant needed replacing because it dates to 1913.

"I know this was a hard decision after we've invested a lot of work," said Council Member Elizabeth Glidden as the committee praised the department for bringing forward the recommendation.

Steve Brandt • 612-673-4438