The Republican-sponsored proposal now heads to the Assembly, which plans to vote on it Thursday.
The bill gives communities and the industry more options and time for reducing the pollutant which causes algae.
Municipal treatment plant operators and business groups have been lobbying for changes to current law, saying the regulations are too expensive, difficult to meet and won't work as hoped to cut down on algae growth in public waters.
The state approved phosphorus regulation in late 2010, under then-Gov. Jim Doyle, but current Gov. Scott Walker and Republicans have been looking at scaling them back.
The bill passed on a voice vote.