The agreement will see the authority rehabilitate and expand Osieko-Nambo Water Supply Project and undertakes piping which is expected to cover 27 kilometres.
Bunyala South is among the hard-hit areas with floods in Bunyala occasioned by backflow from Lake Victoria and overflows from River Nzoia.
Various sources of water in the region are currently contaminated as many homes are submerged.
Okeyo said the authority will work on the infrastructure and hand over the project to the county when it is complete.
“The authority is committed to enhancing the good partnership with the county government and will ensure the project is completed,” said Okeyo.
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