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Authority's 'final offer' negotiable

The State Power Authority's take-it-or-leave-it offer to Buffalo and Erie County is now being negotiated.

Senior operating officers of the Power Authority met behind closed doors Tuesday in the offices of County Executive Joel A. Giambra to discuss local demands that the authority's "final offer" be increased.

The County Legislature and the Buffalo Common Council last spring unanimously rejected the authority's offer of $2 million a year for 50 years. The authority is seeking a settlement with local governments to get their support for a renewal of its license to operate the Niagara Power Project through 2057. The Power Authority has offered Niagara County entities about 10 times that amount.

Authority Chief Operating Officer Timothy S. Carey said the Buffalo meeting was "the beginning of a dialogue."

"We did not settle on a figure," Carey said later in a meeting with editors at The Buffalo News.

With Giambra were Mayor Anthony M. Masiello, Anthony H. Gioia, chairman of the newly created Erie Canal Harbor Development Corp., and Lawrence W. Quinn, a director of the corporation and managing partner of the Buffalo Sabres. Giambra said the meeting was "very productive" but declined to provide details. However, other local officials who were at the meeting said on condition of anonymity that they had settled on a proposal to present to the authority.

Instead of $2 million a year, the package asks for $7 million -- $2 million for Gov. George E. Pataki's Greenway Commission and $5 million for Gioia's corporation that will develop the inner and outer harbors.

Tied to $5 million is a request for some low-cost electricity to spur downtown development.

"All they did is agree to some framework for future discussions," said a local participant in the meeting who spoke on condition of anonymity.

Rep. Brian M. Higgins, D-Buffalo, the protagonist in the drive to obtain Power Authority funds to restore the outer harbor, said:

"While we don't have a formal settlement agreement yet, we have come a long way in five months. Western New York is now united in our efforts to get a fair mitigation settlement to help build a new Buffalo waterfront."

Carey said the authority must balance the size of any financial package with its desire not to have the costs associated with any settlement result in higher electric rates for its customers -- a move that could hurt the fragile Buffalo Niagara economy.

"We don't have this great pot of gold that we can just shift. It's just not there," Carey said. However, the authority values the profits from the Niagara Power Project at $538 million a year. Authority trustees have directed much of that surplus to subsidize New York City housing and regional commuter transportation operations.

Sen. Charles E. Schumer, D-N.Y., said he still seeks a meeting between authority leaders and the Western New York congressional delegation. "[The authority] can do better for Erie County, and we'll make this clear at our delegation meeting," Schumer said.

Rep. Louise M. Slaughter, D-Fairport, said that she has found the Power Authority "to be receptive to our efforts to secure a better deal for our community."

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