RALEIGH - The City Council's Public Works Committee on Wednesday gave its blessing to Raleigh's $86 million plan to pump treated wastewater across the city, but that approval came with a number of caveats.

After recommending approval of a $2.35 million contract to build a reuse water storage tank in Southeast Raleigh, the committee asked that the City Council consider making several changes to the way the city pays for water and sewer projects.

The possible changes were all proposed by Councilman Russ Stephenson, the committee's chairman. They include charging capacity fees for new developments wanting to tie into the water and sewer system, and offering financial incentives to customers to encourage conservation.

Both ideas are likely to spur much debate within the City Council and between the council and city staff.

Earlier this year, Councilman Thomas Crowder proposed adopting impact fees for water capacity, but the idea was panned by Mayor Charles Meeker and several other council members.

City Manager Russell Allen said last week that he is not convinced that offering water customers financial incentives to conserve is necessary.

The only proposal put forward by Stephenson that wasn't unanimously approved by the three-person committee was a recommendation that the City Council approve all major customer contracts for the new reuse system.

In opposing Stephenson's motion, Councilwoman Mary-Ann Baldwin lodged a familiar gripe against her colleague.

"I think we're doing the staff's work," she said. "I don't think we should micromanage the staff."

The city's reuse master plan calls for a network of 145 miles of pipe to run from Raleigh's wastewater-treatment plants to major water users such as the Walnut Creek Amphitheatre, the Raleigh Country Club and N.C. State's Centennial Campus.

Stephenson said council's oversight of the contracts is needed because early next year the city will be moving to tiered water rates, which charge customers more for using a high volume of water.

The Public Utilities Department had planned for the treated wastewater to cost half the price of Raleigh drinking water, but that assumed the current flat fee for water would still be in place.

The Public Works Committee's recommendations will be discussed by the full City Council at its meeting next week.