NY Transp Corps L § 119 (2021)
2021 New York Laws TCP - Transportation Corporations Article 10 - Sewage-Works Corporations. 119 - Guaranties.

§  119.  Guaranties.  1.  The  local  governing body shall require the posting of a performance bond for the completion of the construction  of the  sewage-works  system,  and may require the posting of an additional bond or other guaranty for the payment of labor and  material  furnished in  the  course  of  such  construction,  and  for  the cost of retained engineering services to the local governing body or sewer agency.   2. The local governing body shall require a reasonable  guaranty  from the  corporation  that  said  corporation  will continue to maintain and operate the system for a period of at least five years, in the form of a bond or other security acceptable to the local  governing  body  in  the amount  of  the  estimated  cost of the operation and maintenance of the sewage-works project, less the estimated  revenues  which  are  received from  properties served, and to be utilized to defray such operation and maintenance costs, as reported by the licensed professional engineer  or consulting  engineering  firm  to  the  local  governing body. The local governing body may, and on petition of the  corporation  shall,  at  any time  review  the  adequacy of such bond or other security, to ascertain whether it should be modified on the  basis  of  fiscal  performance  or other conditions.   3. (a) In addition to the guaranty, the stock of the corporation shall be  placed in escrow and title thereto shall pass to the local governing body in the event of failure to complete the construction thereof, or in the event of  abandonment  or  discontinuance  of  the  maintenance  and operation of the system by the corporation.  (b)  In  the  county  of Suffolk said stock placed in escrow may pass, with  the  consent  of  the  local  governing  body  and  the  board  of supervisors to a county sewer agency in the event of failure to complete the construction of said sewer system, or in the event of abandonment or discontinuance  of  the  maintenance and operation of said system by the corporation.   4.  In  the  event  of  such  abandonment  or  discontinuance  of  the maintenance  and operation of the system, the local governing body shall have the right to continue the maintenance and operation of  the  system at the established rates, with the costs assessed against the users, and it  may  levy taxes, or sewer rents for such purposes in the same manner as if such facilities were owned by a city, town or village, as the case may be. The local governing body shall have such powers until such  time as  another  corporation or agency may undertake to maintain and operate the sewer system, or until such time as it becomes a part of a municipal or sewer district system.   5. In Suffolk county in the event of an abandonment or  discontinuance of  the maintenance and operation of the sewer system, the county agency shall have the right to undertake to maintain  and  operate  such  sewer system, and it shall do so at the established rates, or such other rates as it may deem necessary, with the costs, including delinquent accounts, assessed against all of the users until such time as the sewer system is included  in a sewer district which shall maintain and operate the sewer system.