A federal court says Portland must protect its drinking water from a harmful parasite. The financial cost could reach up to $500 million.

Neighbors of the reservoirs at Mt. Tabor are bracing for the worst after a federal court ruled the threat of the parasite called cryptosporidium leaves Portland's open air water supply vulnerable.

“I think Portland should not stand down. I think if the case would've been argued on scientific merit it would've won,” said Cascade Anderson Geller, a leader with the group Friends of the Reservoirs.

She urges the city to further resist the federal government, if not to save the historic reservoirs then to save hundreds of millions of dollars in construction costs for an all-new water delivery and storage system.

But Portland Water Commissioner Randy Leonard says the city did everything it could to fight the EPA mandate.

The time to back down is drawing very near, he says.

“I recognize the phenomenon known as beating your head against the wall.”

Still, the water bureau’s director, David Shaff, says it's worth one more try to prove to the federal government that Portland’s naturally filtered water is so clean it should get a waiver or so-called variance from the rule.

“They've expressed doubts that any public water system can do that. But we will at least pursue that variance.”

Failing that, Portland would have to make sure every reservoir carries filtered drinking water.

Filtering systems, underground storage tanks and treatment plants together could cost from $250 million to $500 million.

Such a financial hit could cause seven percent increases in water bills for many years to come.

“Who wins are big engineering firms,” Said Geller.

Neighbors are prepared to fight.

Commissioner Leonard says that's okay as long as everyone is also be prepared to give up.

“I can't stop the planning now. I mean, we have to move forward.”