Abstract: A method comprises placing in a vessel a mixture having a specified suspended solids or sludge concentration and comprising a water-based reaction medium and at least one microalgae including filamentous cyanobacteria, said water-based reaction medium comprising a nutrient material that is consumable by a live bacterium or by a live protozoan present in said water-based reaction medium, and incubating said mixture for a specified incubation period under at least intermittent illumination with a specified luminous flux during periods of illumination while mixing said mixture under a specified shear stress, wherein said filamentous cyanobacteria forms a supporting matrix that incorporates said live bacterium or said live protozoan into a biologically-active bioaggregate granule, wherein said incubating produces a plurality of said biologically-active bioaggregate granules.