Wagga mayor Greg Conkey said the council has worked "very hard" on the Lake Albert water level issue and has secure a path forward with the NSW government to find a solution.
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Cr Conkey, along with Wagga City Council general manager Peter Thompson, independent Wagga MP Joe McGirr and Nationals MLC Wes Fang met with NSW Water Minister Melinda Pavey in Sydney on Tuesday.
"The minister is well aware of the significance of Lake Albert and the importance of Lake Albert to this city," Cr Conkey said.
"The minister is very keen to find a solution to the water issues of Lake Albert."
The Council agreed to work with NSW Department of Planning, Industry and Environment (DPIE) for a proposal to raise the lake's water level and present the proposal to the minister by the end of the month.
The Council's preferred solution would involve receiving credit for the 5000 megalitres of treated effluent it returns to the Murrumbidgee River and using that credit to pump an additional 2000 megalitres of water into Lake Albert when required.
Cr Conkey said an extra 2000 megalitres would make a difference to the lake, which can hold up to 4000 megalitres.
Dr McGirr said the subject water use and entitlements across NSW was "fraught".
"This is a difficult issue...we want to look after our river systems, but of course we have an important community asset in the lake, important for the growth of our city.
"I think the proposal that we have come up with ensures both the continuation for the lake and the security of our river system, so I think it's a win-win all round."
Cr Conkey said there were also six senior executives from NSW government departments and agencies at the meeting
"We had a high profile group of people at that meeting," Cr Conkey said.
Cr Conkey said recent heavy rains had made a "marginal" impact on the lake, and said new dams on the flood plains and drought-stricken soils reabsorbing water could have diminished the effects of winter rainfall.
Wagga Boat Club Commodore Mick Henderson said the agreement between the council and the minister was "very positive" and it would be a "happy day" if the council's solution was accepted.
"It will be fantastic for the community, it will drought proof it, it's the answer we have been looking for," he said.
"I'm waiting until it gets signed on the dotted line. We have been in a lot of situations like this and until that pen goes to paper, fingers crossed that it happens as there's a lot of politics involved here."
Mr Henderson said the Wagga Boat Club would be able to hold its events if just 1000 extra megalitres was pumped into the lake.
"Under normal conditions, 1000 megs would be plenty to make it usable every year," he said.
Mr Henderson was one of several people who placed an unauthorised shutter over Tatton Drain last month in an attempt to improve the lake's water level via captured rainfall.