Legal challenge confronts Portland’s $2.1 billion water filtration plant

Published 10:19 am Saturday, January 25, 2025

After years of controversy and cost increases, the Portland Water Bureau’s planned $2.1 billion filtration plant is facing another challenge.

The state Land Use Board of Appeals remanded approval of the bureau’s conditional land use permit back to Multnomah County, whose planning officials approved it in 2023. The 130-page ruling upheld most of the application, but said county officials had not adequately considered the 90-acre plant’s impact on natural resources in the rural East County area where it is being built, south of Oxbow Regional Park. Construction started in 2024.

The ruling was issued on Wednesday, Jan. 22. All parties have 21 days to decide whether to appeal the ruling to the Oregon Court of Appeal. Portland is supporting a bill at the 2025 Legislature to prevent land use appeals from delaying critical water projects.

“The City of Portland is dedicated to ensuring transparent and thoughtful engagement in the land use process. Following review of extensive legal briefing, oral argument, and a several-thousand-page record from the County land use proceedings, LUBA partially remanded the Multnomah County Hearings Officer’s approval of the project’s land use application on one item. The remand identifies a need for the County to further clarify the interpretation of what qualifies as natural resources under their code,” the water bureau said in a statement released Friday.

The conditional use permit was appealed to LUBA by a coalition of community and agricultural groups, including 1000 Friends of Oregon and the Oregon Association of Nurseries. They argued the city did not make a clear enough case for needing to build on land zoned for agricultural use. They also said the city failed to identify the impacts of construction on nearby farms.

“I welcome this decision by LUBA,” Jeff Stone, the executive director of the Oregon Association of Nurseries, said in a statement. “To site a water treatment plant requires a proper planning process, which the Portland Water Bureau did not do. We support alternative options. More than 250 nurseries were being harmed by building this costly project.”

The water bureau does not consider the ruling an injunction and is planning to continue construction while exploring its options. The city has promised the EPA it will complete the plant by 2027.

“With construction underway, keeping momentum on the project is our best opportunity to achieve the compliance deadline and control against rising costs. We will continue to look at ways to provide the best value for our ratepayers and maximize the public health benefits our customers will receive from the new facilities,” Water Bureau Chief Engineer Jodie Inman said in the Friday statement.

The ruling was issued a little more than a month after the water bureau received a second long-term, low-cost loan from the U.S. Environmental Protection Agency to help finance the plant, whose cost has quadrupled since it was first approved by the City Council in 2017. At that time, it was estimated at $500 million.

Oregon U.S. Sen. Jeff Merkley announced the new $319 million loan at a press conference on Friday, Dec. 13. The first loan from the EPA Water Infrastructure Finance and Innovation Act loan was for $727 million.

“I’m glad to be here to celebrate the project that will protect Portland’s water supply into the future. These loans will save the city hundreds of million of dollars in coming decades,” said Merkley, who led the creation of the loan program in Congress.

The EPA is requiring Portland to treat water from the Bull Run Reservoir, the city’s primary water source, for cryptosporidium, a potentially deadly parasite. The Council decided to comply by building a plant that also could filter sediments out of the reservoir in the Mt. Hood National Forest in the event that mud from a large landslide or ash from a large fire in the watershed makes it otherwise undrinkable.

A 2,000-plus acre fire came within two miles of the reservoir in late September 2023 before being extinguished.

The cost increase has prompted the water bureau to delay other needed projects to minimize water rate increases. One is the planned earthquake-proof water line under the Willamette River that would continue supplying water to west Portland after the expected Cascadia Subduction Zone earthquake.

Despite that, according to an analysis by The Oregonian/OregonLive, water rates were projected to increase 7.9% in July 2024, then increase to 8.1% per year through 2030, before dropping down to 4.5% after that.

“I welcome this decision by LUBA…. To site a water treatment plant requires a proper planning process, which the Portland Water Bureau did not do.”

Jeff Stone, executive director, Oregon Association of Nurseries