AUGUSTA — Removing a dam that’s blocked the Kennebec River since the 1830s would restore an Atlantic salmon fishery while paying off big economic dividends as fishermen flock to the area, lawmakers were told Monday.

“All you have to do is help Mother Nature” by providing free passage for salmon, shad, alewives and other fish that would gain another 18 miles of free passage if the Edwards Dam is removed, said Rep. Donald V. Carter.

The Winslow Democrat told the Judiciary Committee that providing eminent domain power to the Atlantic Sea-Run Salmon Commission “merely give(s) the state a club” in negotiating a fair price for the purchase of the 990-foot-wide hydroelectric dam near the heart of the state capital.

The Edwards Dam “is a 160-year-old ecological disaster … another historical mistake (whose) time has come for correction,” said Rep. John F. Marsh, sponsor of the proposal advanced by Gov. John R. McKernan earlier this year.

Marsh, R-West Gardiner, also noted that the dam provides only 0.10 of 1 percent of Maine’s power needs. But he said that restoring a fishery that was eliminated when the dam was erected in 1934 represents an extra $6 million a year in commerce for the capital area.

City officials and representatives of the dam are opposing Marsh’s bill.

“It’s a dangerous precedent to take a productive piece of property off the tax rolls, particularly in a city that has so much tax-exempt property,” said Augusta Mayor William D. Burney.

The city currently receives about $80,000 a year in property taxes from the dam, but that could escalate to $500,000 if it is redeveloped, Burney told a reporter.

The Augusta City Council on Monday night was to begin discussing a recommendation to help the owner, Edwards Manufacturing Co. of Lisbon Falls, in its bid to get a new federal operating license after the current one expires in 1993.

In exchange, the city would get a portion of electricity sales and an option to buy the dam in 1998.

Opponents of McKernan’s eminent domain plan took exception Monday to assertions that it would not make economic sense to rebuild the dam.

Anthony Buxton, a lawyer representing Edwards, said Central Maine Power Co. will be paying higher prices for power it purchases from some generators than Edwards will need to make a profit if the dam is redeveloped.

“If the plant is not economically feasible,” Buxton said in an interview as he awaited his turn to testify, “it will not be redeveloped.”

While state Environmental Protection Commissioner Dean C. Marriott claimed that the dam’s removal would have a positive environmental impact, Buxton warned that its removal would dry up more than 60 acres of wetlands.

Buxton and Burney both said the bill’s backers have offered no support for their predictions that Augusta would reap big economic benefits from an expanded fishery.

Administration officials said the newly opened free-running waterway also would draw canoeists to the stretch of river between Augusta and Waterville. Several dams block the river in Waterville.

Marsh said a fishway in the Edwards Dam would not be effective for salmon and some other species.

The 38 miles of unobstructed river from Merrymeeting Bay on the coast to Waterville “represents the longest stretch of freshwater habitat that would be accessible to striped bass, sturgeon and rainbow smelt in the United States north of the Hudson River,” Marine Resources Commissioner William J. Brennan said in a prepared text.