State regulators can apply stricter drinking water standards to limit the groundwater pollution coming from a northern Minnesota taconite mine, the Minnesota Supreme Court ruled Tuesday.

The Minnesota Pollution Control Agency (MPCA) was within its authority when it decided that the pollution that has been seeping from the mine's waste for years has harmed groundwater that met the state's strictest water-quality standards — standards that include drinking water, Justice Paul C. Thissen wrote on behalf of the court.

The decision throws out an appellate court ruling that the MPCA couldn't use the stricter standards when it issued a contentious permit to Minntac's mine in Mountain Iron, owned by U.S. Steel Corp.

The ruling is a clear victory for state regulators and environmental groups, who argued the state was allowed to limit sulfate pollution into groundwater — not just surface water.

It's a victory in the protection of not only wild rice waters, but also to the aquifers that supply drinking water throughout the state, said Sara Van Norman, lead counsel for the Fond du Lac Band of Lake Superior Chippewa, which appealed the case to the Supreme Court along with the MPCA and the environmental group WaterLegacy.

"It affirms that groundwater needs to be protected as drinking water," Van Norman said. "Eventually, we need to be able to count on these aquifers to be available and protected for that use."

The MPCA is still reworking the Minntac mine's water-quality permit. A 2019 court order said the agency may have been too lenient to U.S. Steel and needed to take a "hard look" at imposing tougher regulations to protect the area's water.

It is unclear when the revised permit may be issued.

MPCA representatives said in a statement that the decision provided "needed clarity" about the state's ability to protect groundwater.

"The agency encourages Minntac to make meaningful progress in reducing its sulfate discharges while the Court of Appeals addresses the remaining matters in the legal challenge," the statement read.

U.S. Steel spokeswoman Amanda Malkowski said in a statement that the company is reviewing the decision.

"We remain committed to protecting our shared environment, our employees, our customers and the communities of the Iron Range," Malkowski said.

The MPCA has allowed Minntac to operate for more than two decades with an expired temporary permit. It gave the facility an updated pollution permit in 2018.

Minntac has a 13-square-mile basin that holds mining waste. Pollutants — primarily byproduct sulfate — have been leaking into nearby waters.

U.S. Steel estimated in court documents that roughly 2,000 gallons of wastewater seeps every minute from the basin directly into local groundwater.

In the updated water-quality permit, the MPCA called for U.S. Steel to reduce sulfate in the basin within 10 years and install a collection system to capture and return contaminants leaking out of the western side of the basin.

But that permit sparked further legal battles.

U.S. Steel appealed it because the MPCA denied the company's request for a variance from groundwater quality standards, and also denied its request to hold a contested-case hearing.

The Fond du Lac Band of Chippewa and WaterLegacy also appealed, arguing that the contaminants seeping into surface water violated water quality standards, decimated downstream wild rice and raised mercury levels in fish.

In 2019, state Appeals Court Judge Jeanne M. Cochran kicked the permit back to the MPCA, saying regulators failed "to take the requisite 'hard look' " at including certain stringent water-effluent standards in the permit.

No changes have been made yet to the permit.

The Supreme Court's decision was reassuring, said Paula Maccabee, lawyer for WaterLegacy.

"In U.S. Steel's zeal to prevent any regulation of its own pollution, the company had put all of Minnesota's regulation of groundwater at risk," she said.

Staff writer Jennifer Bjorhus contributed to this report.

Greg Stanley • 612-673-4882