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State regulators gave Santa Rosa permission Wednesday to continue to discharge wastewater into the Laguna de Santa Rosa, but under a permit that could force the city to spend millions to better monitor and control the quality and quantity of what it releases.

The North Coast Regional Water Quality Control Board granted the city a five-year permit that both sides said contained requirements that may be difficult to meet within that time frame.

The decision came after two days of sometimes contentious debate. City officials considered some regulatory issues too vague and costly to implement, while the board staff said they were necessary to help return the impaired waterway to full health.

Board member John Corbett said several last-minute concessions granting Santa Rosa some leeway in meeting some monitoring and nutrient discharge issues should allow both sides "to split the risks" toward being in compliance by the year 2011.

The primary stumbling blocks centered on the board's stance on small accidental sewage overflows, the location of monitoring stations to gauge the impact of wastewater on steam flows near discharge pipes and establishment of limits on the amount of nutrients - primarily nitrates and phosphorus - carried by wastewater into the Laguna.

Board staff said nutrients are a primary reason the Laguna, one of the state's largest wetland areas, is listed as impaired.

"It's a wastewater soup out there," said senior engineer John Short.

While the board didn't back off its position on sewage overflows, it did give the city six months to develop a wastewater monitoring program subject to North Coast staff approval.

Corbett said the board may be willing to ease its nutrient discharge limits if a multiyear study to determine the impacts of nutrients on the Laguna is not completed by the time the new permit expires.

North Coast executive director Catherine Kuhlman, however, said meeting the 2011 deadline could be problematic since most of the district's resources are committed to conducting a similar study in the Klamath River area over the next few years.

City officials later Wednesday said they were pleased with the changes but said they're not sure they go far enough.

"Even if we don't include those three issues, it is a very stringent permit that will expose our ratepayers to some pretty extreme costs," Deputy City Manager Greg Scoles said.

Consultant Dave Smith, who is leading the city's permit renewal process, said: "The board did make some changes around the margins, but we are still trying to understand what the full implications are."

Scoles said the city has 30 days to decide if it wants to appeal to the State Water Resources Board.

Scoles said that in his view, the board is pushing the city to eventually move its discharge point to the Russian River.

Such a controversial shift, Scoles said, "would be expensive, time-consuming and potentially difficult to permit" because of the opposition it would generate.

Estimates are the shift would cost well over $100 million. That is in addition to the $200million the city is considering spending to expand its outdoor irrigation program to deal with half of 2.2 billion gallons of annual wastewater expected to be generated by additional growth in Santa Rosa and in Rohnert Park, Cotati and Sebastopol, the city's partners in the regional sewage treatment system.

Congresswoman Lynn Woolsey, D-Petaluma, this week announced she has introduced legislation that, if approved, would provide Santa Rosa with $20 million to help develop an agricultural/urban wastewater discharge program.

Woolsey, however, insisted the city not look toward the Russian River as its discharge solution.

For decades, the Laguna, which flows into the river, has been the city's primary discharge point. That changed in 2003 when the $205 million Geysers wastewater-to-electricity project became operational.

Today, about 80 percent of the wastewater generated by the four cities is either pumped to The Geysers or is used to irrigate 6,700 acres of agricultural and urban land.