N.Y. TCP Law § 119 — New York Code / Act TCP / Article 10 / Section 119
Guaranties
Status: in_force

§ 119. Guaranties. 1. The local governing body shall require the\nposting of a performance bond for the completion of the construction of\nthe sewage-works system, and may require the posting of an additional\nbond or other guaranty for the payment of labor and material furnished\nin the course of such construction, and for the cost of retained\nengineering services to the local governing body or sewer agency.\n  2. The local governing body shall require a reasonable guaranty from\nthe corporation that said corporation will continue to maintain and\noperate the system for a period of at least five years, in the form of a\nbond or other security acceptable to the local governing body in the\namount of the estimated cost of the operation and maintenance of the\nsewage-works project, less the estimated revenues which are received\nfrom properties served, and to be utilized to defray such operation and\nmaintenance costs, as reported by the licensed professional engineer or\nconsulting engineering firm to the local governing body. The local\ngoverning body may, and on petition of the corporation shall, at any\ntime review the adequacy of such bond or other security, to ascertain\nwhether it should be modified on the basis of fiscal performance or\nother conditions.\n  3. (a) In addition to the guaranty, the stock of the corporation shall\nbe placed in escrow and title thereto shall pass to the local governing\nbody in the event of failure to complete the construction thereof, or in\nthe event of abandonment or discontinuance of the maintenance and\noperation of the system by the corporation.\n  (b) In the county of Suffolk said stock placed in escrow may pass,\nwith the consent of the local governing body and the board of\nsupervisors to a county sewer agency in the event of failure to complete\nthe construction of said sewer system, or in the event of abandonment or\ndiscontinuance of the maintenance and operation of said system by the\ncorporation.\n  4. In the event of such abandonment or discontinuance of the\nmaintenance and operation of the system, the local governing body shall\nhave the right to continue the maintenance and operation of the system\nat the established rates, with the costs assessed against the users, and\nit may levy taxes, or sewer rents for such purposes in the same manner\nas if such facilities were owned by a city, town or village, as the case\nmay be. The local governing body shall have such powers until such time\nas another corporation or agency may undertake to maintain and operate\nthe sewer system, or until such time as it becomes a part of a municipal\nor sewer district system.\n  5. In Suffolk county in the event of an abandonment or discontinuance\nof the maintenance and operation of the sewer system, the county agency\nshall have the right to undertake to maintain and operate such sewer\nsystem, and it shall do so at the established rates, or such other rates\nas it may deem necessary, with the costs, including delinquent accounts,\nassessed against all of the users until such time as the sewer system is\nincluded in a sewer district which shall maintain and operate the sewer\nsystem.\n