State officials say federal PFAS settlements will cover small share of local water projects

Attorney General’s Office assistant Oliver Larson told the House Capital Investment Committee on April 8 that the multi‑state federal litigation over PFAS, which includes a South Carolina court settlement, has moved into a claims‑administration phase and that initial distributions to local water systems are unlikely before 2026.

Larson said the two national settlements by 3M and DuPont together made roughly $12 billion to $13 billion available to water systems but that the distribution will be spread over roughly 10 years and administered by a claims administrator. "There's gonna be a pool of money that's gonna be paid out over about 10 years," he said. He added communities could use an online estimator at the time of opting in but cautioned the figures were estimates.

Why it matters: county and municipal officials attending the committee are seeking capital funds to replace or extend treatment and distribution systems affected by PFAS contamination. Larson and Minnesota Pollution Control Agency (MPCA) staff told lawmakers that settlement money should not be viewed as replacing state or local capital investments because typical recoveries are likely small relative to project costs.

Larson and others described the opt‑in/opt‑out structure for the national settlements. Of roughly 12,000 water systems eligible under the national settlements, about 900 — roughly 7 percent — opted out, he said. He estimated typical recoveries for projects would be in the range of 3 to 5 percent of a project's cost and said he would be surprised if any community received more than about 10 percent of what they expected to need. "I would be shocked if there's any community that's going to get more than about 10% of what they need to build the projects that they're contemplating," Larson said.

MPCA assistant commissioner Kirk Adelka told the committee the state’s own 3M settlement money is already substantially committed to projects in the East Metro and that projected funds could be exhausted as early as fiscal year 2027. "We estimate the funds will run out because of capital projects and ongoing operation projects that are already planned in fiscal year 2027," Adelka said. He said MPCA will issue updated projections in May for the communities and work groups involved.

Committee members asked whether the committee could determine which communities had opted into the national settlement. Larson said the claims administrator previously declined to provide a list on request; he said he would make another inquiry but warned the administrator's answer might not change. "At this point your best option for figuring out which communities are in and out is simply to ask them," Larson said.

MPCA staff and committee members also discussed state efforts to recover costs from responsible parties. MPCA said it has opened more than 20 investigations to identify potentially responsible parties and that the agency and the Department of Health have proposed statutory language to allow the state to fund urgent work and then pursue cost recovery later. The MPCA described that approach as one way to protect taxpayers when communities need money to build urgently.

Ending: Larson and MPCA officials urged lawmakers to view the multi‑state settlements as supplemental, not primary, funding for major water‑system capital projects and urged continued legislative consideration of state‑level funding and legal tools to pursue responsible parties.