A $425 million debt package approved today will allow the Pittsburgh Water and Sewer Authority to fix its plant and pipes without rate increases, officials said.

The package, long in the making, will boost the authority's debt to $680 million, and its approval comes a day after City Controller Michael Lamb called rising debt at city-related agencies "definitely a problem."

Around $325 million of the package will refinance old debt at a lower rate or cover costs of borrowing and initial interest payments. But the package also provides $100 million for improvements and repairs to the Highland Park water treatment plant, the pumping stations and aging water and sewer mains, plus preparation for new development and potentially huge reconstruction expenses to come.

"I think it's vital to make these improvements, particularly at our water plant," said authority board Chairman and state Rep. Don Walko, D-North side.

The package does not increase the authority's $42 million-a-year debt payment, but extends it by 11 years, to 2040.

In recent years, the authority has repeatedly borrowed and raised rates to keep pace with repair costs, expansions and preparations for a coming round of reconstruction. A regional sewer overhaul driven by federal and state mandates to keep sewage from overflowing into the rivers could force large-scale rebuilding starting in 2012.

Today's action won't lead to a rate increase, said authority Executive Director Michael Kenney. "I don't anticipate a borrowing through 2012 that will impact the rate," he said. He wouldn't predict what would happen to rates after that.

Yesterday Mr. Lamb said he was concerned about "both rate increases and debt increases" at the city-related authorities, which also include the Urban Redevelopment Authority, Parking Authority and Stadium Authority. The four authorities' combined year-end debt, according to the city's annual audit released yesterday, was $845.5 million, and the water authority package would push that above $900 million.

Authority finances and the city balance sheet are increasingly linked.

"We're seeing significant increases in payments to the city from the authorities," Mr. Lamb said. The city got $6.6 million from the authorities in 2006, $9.1 million last year, and expects $13.1 million this year.

Included in that, the water authority's contribution to the city's coffers is rising from $5.3 million last year to $7.8 million this year. City Finance Director Scott Kunka, who sits on the authority's board, said there is no relationship between the borrowing and the increased payment to the city.

"This is a necessary capital infusion for the upgrade of the water treatment plant," he said. "We think it's prudent, and that no matter what the future holds [in terms of] city-county cooperation, clean water will be needed for the citizens of the region."

More details in tomorrow's Pittsburgh Post-Gazette.