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The sale of Buffalo's water system to the Erie County Water Authority inched forward Thursday as the authority agreed to some needs insisted upon by the city Water Board.

The authority unanimously agreed to spend $15 million a year on capital improvements to the city system until the two networks become one, within about 10 years. The authority had agreed to that figure in past statements, but the city Water Board this week said it wanted the promise written into the "memorandum of understanding" that is the focal point of negotiations.

Water Authority Commissioner Robert J. Lichtenthal Jr. said he worries that spending $15 million on improvements will be difficult if the number of Buffalo customers continues to decline and the city doesn't generate enough money for the authority to meet other commitments the sale creates. But the authority's staff, including Executive Engineer Wes Dust and Deputy Director Edward Kasprzak, said improving the system early on will help save money on operating costs later.

Lichtenthal and Chairwoman Acea Mosey-Pawlowski also agreed that if Buffalo's declining number of ratepayers does not generate the money needed, rates might have to rise beyond current projections of 34.4 percent over 10 years.

The memorandum of understanding is expected to be signed by city Water Board Chairwoman Victoria J. Saxon and presented to the State Environmental Facilities Corp., which would borrow the $123.7 million that allows the County Water Authority to take on Buffalo's debt. The Water Authority will repay that debt and pay Buffalo $31.5 million in six annual installments.

The Buffalo Common Council must schedule a referendum on the sale, expected in February, in order for the change to take effect by the summer of 2005. The deal also needs the approval of state and city unions.


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