The utility would pay for the project with state financing.
The city has said it will ask for more state financing.
It is built on private Palestinian land with state financing.
The state financing is expected to run out by June.
A judge could rule later this week on the state financing.
Without a private partner the state financing would not be available.
It also provided for state financing of abortions among the poor.
In June, the two learned that because of budget cuts, for the first time, they would get no state financing.
The program will grow next year with more state financing.
The operators may continue to worry that state financing will not cover the costs.