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2 groups are left in power talks NU, alliance hope to gain on relicensing

After watching Erie County win a substantial Niagara Power Project settlement, the two remaining groups seeking compensation from the New York Power Authority hope they will be as successful.

So far, the authority has pledged nearly $2 billion over 50 years to compensate for the impact of the huge hydroelectric plant in the Town of Lewiston. Local towns and school districts, environmental projects and the Tuscarora Indian Nation all have agreed to support a new federal project license in exchange for an assortment of money, low-cost electricity and other benefits.

Only Niagara University and a group of communities and school districts known as the Eastern Niagara Power Project Alliance remain without a settlement. But considering the deal Rep. Brian M. Higgins helped Buffalo get, those groups hope for a happy ending.

After the Niagara Power Coalition reached its settlement with the Power Authority earlier this year, it called on Buffalo and Erie County to stop arguing and accept the authority's offer. The group -- comprising Niagara County, the City of Niagara Falls, the towns of Niagara and Lewiston and the Lewiston-Porter, Niagara Falls and Niagara-Wheatfield school districts -- denounced Erie County's resistance as "a blatant money grab."

"It is time for this shakedown to end and for Buffalo and Erie County to accept the very generous offer of $2 million per year," coalition director Mark Zito wrote in an editorial.

Higgins, D-Buffalo, didn't agree. After other New York officials got on board, the Power Authority agreed to nearly triple its offer, to $279 million over the 50-year license term. That's partly why James Mills, the superintendent of the Newfane Central School District in eastern Niagara County, is so intrigued by the possibilities of another settlement.

Even before Erie County's settlement, Mills was organizing a group of communities and school districts left out of the Power Authority's deals.
Now grown to 17 members, including the City of Lockport, seven towns, seven school districts and two villages, the Eastern Niagara Power Project Alliance has hired a legal adviser who specializes in power-licensing issues. It also has filed an intervention notice with the Federal Energy Regulatory Commission, the agency expected to grant the Niagara Power Project's new license in 2007.

"At the conclusion of the settlement with the Niagara Power Coalition, the word was that all deals are done and it was over," Mills said. "The fact that Congressman Higgins was able to get them to the table to negotiate shows it wasn't a done deal."

The communities included are crisscrossed by Power Authority rights of way. One member, the North Tonawanda School District, has more than a mile of shoreline on the Niagara River.

Mills said his group will use whatever levers it can to get a fair settlement, including the assertion that the relicensing has to comply with state water-quality reviews and related hearings that haven't been held.

He declined to suggest a figure the coalition would seek.

Power Authority spokesman Brian Vattimo said the authority would negotiate with the Eastern Niagara Power Project Alliance if federal regulators say it's necessary.

Mills said that when the Power Project was established half a century ago, the state made promises to Niagara County about cheap power and jobs. Some of those promises have not come true, especially in the eastern half of the county, he said.

The authority is not taking the same approach with Niagara University, which has been involved with the relicensing process for more than five years. At one point, the university, which abuts the hydroelectric plant, suggested the authority should help it relocate much of its campus.

e-mail: agalarneau@buffnews.com

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