Planners of the embattled Southwest Corridor light-rail line unveiled a new strategy Wednesday for digging a tunnel under a water channel to win over Minneapolis critics and end an impasse that threatens to scuttle the largest transit project in the Twin Cities.

The latest option could keep light-rail trains out of sight in the popular Kenilworth recreation corridor but add as much as $85 million to the cost of the project and bring it to over $1.6 billion.

The Metropolitan Council, the agency overseeing the light-rail project, disclosed the new tunnel option Wednesday to a group of metro leaders without endorsing it. Met Council Chairwoman Susan Haigh issued a statement saying her agency considered the option last year but rejected it as “a less desirable alternative” than other plans.

The agency recently revisited the idea after being pressed to do so by the Minneapolis Park and Recreation Board.

Minneapolis Mayor Betsy Hodges, who wasn’t at the meeting, issued a statement calling the latest option “a brand new, and therefore, unstudied idea that is being put on the table three weeks before I’m supposed to vote” on the light-rail project. She questioned whether the tunnel would harm the channel, Lake of the Isles or Cedar Lake.

But Hennepin County Commissioner Peter McLaughlin called the new option “potentially helpful … something worth exploring.”

Hodges: The Minneapolis mayor questioned the new tunnel proposal’s effect on lakes.

Minneapolis and St. Louis Park have been at loggerheads over whether to reroute freight trains to make room in the Kenilworth corridor of Minneapolis for existing recreational trails and the future Southwest line, which would run nearly 16 miles from downtown to Eden Prairie. Minneapolis city officials want to reroute Twin Cities & Western freight trains from the corridor to a neighborhood in St. Louis Park, but St. Louis Park doesn’t want it.

Minneapolis rejected an earlier Met Council plan to spend $160 million to build light-rail tunnels in the corridor on either side of the water channel connecting Lake of the Isles and Cedar Lake and next to the freight line. Bike and pedestrian trails would have been located above the tunnels.

Homeowners along the corridor complained that light-rail trains surfacing from the tunnels to cross a channel bridge would be unsightly.

Spending another $85 million to sink the tunnels under the channel would bring the total tunnel cost to $245 million and put the light-rail trains underground for 1.1 miles of the corridor. The Met Council also unveiled on Wednesday a $40 million version that would sink the light-rail line under the channel as part of a tunnel six-tenths of a mile long with a total cost of $200 million.

Plan would add a year

Tunneling under the channel was proposed last summer at a rally of about 100 people on the shore of Cedar Lake in Kenilworth corridor, an affluent area that includes influential DFLers. Some of the leaders have back yards facing the Kenilworth corridor bike and pedestrian trails.

At the time homeowners embraced a channel option that would have contributed $330 million to the cost of the project. When metro leaders shot it down as too expensive, some residents asked the Met Council staff to investigate a cheaper way to tunnel under the channel. The agency said at the time that it considered but wasn’t pursuing the idea.

But the Minneapolis Park and Recreation Board, which has authority over park areas in the corridor, recently pressed the agency to further investigate the possibility.

“We felt compelled to take a closer look at it,” said Mark Fuhrmann, who oversees transit development for the Met Council.

“The Met Council originally told us this was impossible,” Hodges said in her statement. “We appreciate the Met Council’s responsiveness to the request from the Park Board. However, anything that may harm our lakes needs thorough analysis ... We expect the community to have the opportunity to review the analysis thoroughly before any votes are taken.”

Analysis of plans for light-rail tunnels on either side of the channel have shown no adverse impact on its water or on water in the nearby lakes.

The group of metro leaders is expected to recommend a plan to the Met Council in early April.

The latest Met Council versions cost less than the $330 million option because they wouldn’t be as deep and could be built by walling off the channel rather than burrowing beneath it.

But they have drawbacks beyond being more expensive than running the light-rail line over the channel. Tunneling under it would add another year to construction of the project, likely delaying the opening of the Southwest line until 2019. And the channel, used by water sports enthusiasts, would be shut down for a year.

Met Council engineers said the $40 million version would greatly shorten the tunnel north of the channel and allow for a station at ground level at 21st Street. But homeowners in the area aren’t sold on the station.

“They’re divided on it,” said Jeanette Colby, who follows Southwest Corridor issues for the Kenwood Isles Area Association.

Cool response from bankroller

The channel options are likely to be viewed as an unnecessary additional cost to an already expensive project or as the price of buying support from Minneapolis. But the Minneapolis City Council last week passed a resolution supporting moving the freight trains, building the light-rail line at ground level next to the bike and walking trails, and rejecting the earlier plan for tunnels.

The Met Council is required by state law to seek municipal consent from the five cities along the proposed line.

“If this gets us to yes, that’s going to help,” McLaughlin said. “It’s very significant. I think it’s something worth exploring.”

But Matt Look, an Anoka County commissioner and a member of the Counties Transit Improvement Board (CTIB) that bankrolls a third of transit development, said, “Someone’s got their hands on CTIB’s wallet.”

He renewed his call to consider a much less expensive option of moving a portion of the bike and pedestrian trails from the corridor to make room for light-rail and freight trains at ground level. The city of Minneapolis has rejected that idea.