Replacing gas boiler

I'm in the process of having to buy a new gas boiler. Keyspan, in my neck of the woods is making an offer of $500 towards an update of old boiler...$599 if converting from oil to gas. I had a plumber to get an estimate from him. I live in a single family home, but it has 2 levels ( often mistaken as a 2 family ) and 3 convection radiators on the first level and 3 old fashioned steel radaitors upstairs. My btu now is 130000. The plumber said that I could use around the same output or up to 140000 btus. The cost would be 3800 with labor...minus the $500 from Keyspan. Is this a good deal? BTW, the old boiler isover 30 years old. I also have a 40 gallon water tank. The plumber gave me an estimate for a new water heater for $800 including labor. My water heater was installed in 1989, and it has shown no problems and no leaks. Keyspan in their offer of $500 or a new gas water heater for 40-to 50 gallons, excluding installation, which the plumber said he would do for $200. Now, I'm torn between getting the $500 rebate or new water heater. The plumber estimated to replace my water heater for $800 including installation. Am I wrong towards leaning for the water heater? Would appreciate some input. BTW, I live in Brooklyn,NY
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