New York State will own and operate Gallagher Beach and the Small Boat Harbor on Buffalo’s outer harbor as a state park under an agreement to be announced Thursday by Gov. Andrew M. Cuomo, The Buffalo News has learned.

Several sources close to the negotiations said Tuesday that the Niagara Frontier Transportation Authority will transfer the two parcels at the south end of the waterfront to the Office of Parks, Recreation and Historic Preservation. Though full details are not yet known, the sources said that another state agency, the Erie Canal Harbor Development Corp., would then take over between 120 and 160 acres of the northern waterfront, much of which was contaminated by industrial and municipal waste decades ago.

Cuomo is expected to make the announcement at an 11 a.m. event Thursday at Templeton Landing on the inner harbor waterfront, to which several supporters have already been invited.

The transfer will be accomplished, the sources said, with the approval of the City of Buffalo, which had also sought a role on the waterfront. The city would not have a direct role in the new arrangement, the sources said, other than granting its approval – considered a key to success of the concept.

“We’re talking about a state-owned park in the city,” said one source familiar with the negotiations. “They have the resources to put into the Small Boat Harbor.”

“I can’t see anything wrong with the thing,” said another source. “How can anybody whine when the state comes in?”

A major question mark surrounding the transaction, however, remains whether the NFTA will receive any compensation for the sale of 384 acres of waterfront land. While the authority has all along placed a multimillion-dollar price tag on any sale – even to a companion state agency like state parks – Rep. Brian Higgins has also insisted that the property be transferred for $2.

“It’s a very unreasonable position for them to want anything for this property,” Higgins said in December, citing what he called poor NFTA stewardship of the land and the more than $30 million in repairs needed to make the Small Boat Harbor a viable operation.

The plan also marks a course reversal for the state parks system, which in late 2012 declined any role on the Buffalo waterfront when invited to bid by the NFTA.

But now those concerns appear to be satisfied after intense negotiations that one source said personally involved Cuomo over the past few weeks.

The involvement of the state parks system resurrects a similar concept advanced by Albany several years ago under the Pataki administration. As far back as 2002, then-Gov. George E. Pataki endorsed the idea of a state park at the waterfront’s south end. Plans were almost completed in 2004 for the state to acquire 80 acres and pay the NFTA $4 million for the land.

But those plans were never made final after the state said it had run out of money and could not afford the purchase.

Since then, the NFTA has continued to emphasize its desire to leave the waterfront development business, even opting to sell the land to a private developer several years ago. But when problems arose in connection with the proposed sale, and questions were raised about public access, the authority reversed course and committed to the property remaining in public hands.

Since then, Higgins has commissioned still-to-be-completed studies to determine whether Gallagher Beach can sustain swimming, while also advocating for further development of the adjacent Small Boat Harbor. One major stumbling block for the NFTA and a potential new owner, however, has been the approximately $30 million needed to build a new breakwater, install new docks and dredge the harbor.

The new proposal would leave the harbor agency to devise an overall plan for the northern acreage of the property, the sources said, with private development in at least some areas expected to be studied in conjunction with public use.

The new plan also appears to present a major obstacle to a group advocating construction of a new stadium for the Buffalo Bills on the site, which has so far been largely ignored by top government officials and the NFTA.

In addition, the plan marks the departure of the NFTA from the waterfront it has controlled since the 1950s, when the land was acquired by a predecessor agency – the Niagara Frontier Port Authority. In ensuing years, the NFTA has floated a variety of ideas for development that never succeeded, leading to its decision to exit the waterfront and concentrate on its core transportation mission.

Cuomo’s office did not return a call seeking comment.

In addition to his waterfront announcement, the governor is expected to endorse Mayor Byron W. Brown for a third term, according to sources familiar with his plans.