A Small City with Big Delusions

Many years ago—well before the 2008 financial crisis—I sat in a meeting where someone representing the tiny town of Pine Island, Minnesota (pop. ~3,300), gave a presentation showing how they were going to attract billions of dollars of biotech industry, and tens of thousands of new people, through a development near the city’s highway interchange.

I remember thinking, “This is utter bull,” but I couldn’t identify another skeptic in this crowd of technical professionals. I’m sure there were some; the project was total madness and I can’t have been the only one who knew it. But in the crazy days of the housing boom, anything seemed possible.

The idea that 25,000 biotech jobs would just appear in a town 20 minutes north of Rochester (home of the Mayo Clinic) was enough to induce the Minnesota Department of Transportation and partners to spend $34 million building a new interchange. Poor timing meant the project landed in the depths of the recession, rendering this “bridge to nowhere” a proverbial white elephant for the various governments involved.

Where did the money for the Elk Run junction come from? Well, Olmsted County chipped in $8.5 million, including $2 million in pass-through federal money. Through MnDOT, the Greater Minnesota Interchange Fund was the source for $14.6 million, Statewide Corridor funds for $10 million and $2.6 million from general funds. The city of Pine Island and Tower Development turned over some real estate, with an estimated value of $3.65 million.

I’ve driven by the site quite a few times since. It’s pretty desolate. Here’s how the local paper—the Post Bulletin, Minnesota Newspaper Association’s 2019 Daily Newspaper of the Year—described it earlier this year:

Visions of a billion-dollar center of biotechnology never came to fruition. The state-funded, $45 million U.S. 52 interchange sees zero traffic, because it essentially goes nowhere. Over the years, Pine Island was left to deal with a quagmire of delinquent property taxes and potential state fines.

The Prairie Island Indian Community recently purchased the failed site. The Prairie Island community has its own complicated history. They received assistance from the state in compensation for failure to remove radioactive waste from a nuclear facility next to the reservation. The hope is that homes for dislocated community members will be going up soon in Pine Island, with the potential for a future casino rumored. I’m very sympathetic to the plight of the Prairie Island Indian Community, but this whole thing feels like the mashup of two wrongs resulting in something not quite right.

I’m giving you this history because this was in the news last week:

The Pine Island Waste Water Treatment Plant pumped roughly 800,000 gallons of rainwater-diluted, but untreated, raw sewage into the middle fork of the Zumbro river over the course of 48 hours. The decision came after heavy rainfalls hit the area, leading officials to make a tough call on Saturday.

For context, an 800,000 gallon spill would be enough to fill 1-gallon jugs lined side by side for nearly 70 miles. It’s enough to cover a football field with two feet of water. It’s not an environmental catastrophe (any engineer will tell you that dilution is the solution to pollution) but nonetheless, this kind of thing shouldn’t happen. Certainly, there is an urgent need to address the problem because there is guaranteed to be more rainfall in the future.

How does a town of 3,300—one that very recently aspired to be 8 to 10 times that size—end up unable to handle sewage in a rainfall event? The answer is as predictable as it is sad: systems are old and there is no money to fix them. As reported:

The Pine Island plant is 70 years old, and upgrades are necessary but cost is a huge factor. “Keeping in mind that a lot of wastewater infrastructure upgrades is millions of dollars that than you know tax payers need to be able to support their community in making that investment to prevent you know wastewater releases basement back-up,” [Aaron] Luckstein [of the Minnesota Pollution Control Agency] said.

Pine Island officials tell KTTC they are looking into building a new plant, but that is still a long way off.

There’s a part of me that believes the state of Minnesota should levy a huge fine on Pine Island for allowing their system to degrade to this point. Yet another part of me wants to know who has really brought about this disaster. Pine Island’s lust for easy growth certainly distracted them from competently performing the basics. There is no doubt the city, and to a degree the residents, hold some accountability.

Yet, the state, by handing out tens of millions gambling on growth, was a major player in that distraction. If the state isn’t there with handouts for a new interchange, does the city pursue the shiny silver-bullet project? If the state is doing its job overseeing pollution discharges, does the city pursue the shiny silver-bullet project? Or are they forced to come to grips with their deferred maintenance problem sooner?

“Hundreds of cities in Minnesota alone, and thousands across the country, have wastewater and water treatment facilities approaching end-of-life with no plan for their rehabilitation or replacement beyond asking for another handout.”

In a system where we put ultimate responsibility in the hands of state regulators, why is a treatment facility more than two decades old not raising red flags, deterring the state from making wild investments in a place unable to competently do basic planning and maintenance? Is it enough for one state agency to look myopically at wastewater discharges, another to look myopically at economic development, and nobody to demand any financial accountability, or even basic financial planning?

Pine Island is an egregious case because of the huge gambling failure. Its wastewater issues, on the other hand, are not exceptional. Hundreds of cities in my home state of Minnesota alone, and thousands across the country, have wastewater and water treatment facilities approaching end-of-life with no plan for their rehabilitation or replacement beyond asking for another handout.

In fact, with the way we make these kind of growth-oriented investments, the more financially fragile and pathetic a local government is, the more money they tend to qualify for. Pine Island is pathetic. It’s also an environmental menace to its neighbors. It probably qualifies for lots of state and federal support.

Six months before announcing the sale of the site, and twelve months before the latest wastewater contamination, the local paper shared the community’s vision:

Through it all, what was true in 2008 is true today. Pine Island is sitting on a gold mine. With about 1,900 acres of prime development land along a major U.S. highway — with a glorious, underused interchange ready to go — Pine Island residents have every reason to believe good times are ahead.

The company [that owns the site and would ultimately sell it to the Prairie Island Indian Community] is looking for a “home run” project, rather than piecemeal development, the mayor says. 

I agree. What was true in 2008 is absolutely true today: Pine Island is delusional. Before pursuing any more home run projects or gambling with other people’s money, they need to fix what they have. They need to demonstrate they can competently run a city of 3,000 before anyone—the state, the federal government, or even bondholders—helps them become a city of 30,000.

And if the state and federal governments want any credibility as environmental regulators, they will make basic, ongoing maintenance of critical systems a condition of any future permitting. And not just for Pine Island. For everyone.

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