Bill Text: NY S06491 | 2019-2020 | General Assembly | Amended


Bill Title: Relates to the establishment of the North Shore water authority.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Engrossed - Dead) 2020-07-23 - referred to corporations, authorities and commissions [S06491 Detail]

Download: New_York-2019-S06491-Amended.html



                STATE OF NEW YORK
        ________________________________________________________________________

                                         6491--B

                               2019-2020 Regular Sessions

                    IN SENATE

                                      June 13, 2019
                                       ___________

        Introduced  by Sens. GAUGHRAN, COMRIE -- read twice and ordered printed,
          and when printed to be committed to the Committee on Rules  --  recom-
          mitted  to  the Committee on Corporations, Authorities and Commissions
          in accordance with Senate Rule 6, sec. 8 -- committee discharged, bill
          amended, ordered reprinted as amended and recommitted to said  commit-
          tee  --  committee  discharged,  bill  amended,  ordered  reprinted as
          amended and recommitted to said committee

        AN ACT to amend the public authorities law, in relation to  establishing
          the North Shore water authority

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:

     1    Section 1. Legislative findings. The legislature hereby finds that the
     2  groundwater supply system presently operated by a private utility in the
     3  northwest portion of the Nassau county servicing the  residents  of  the
     4  village  of  Sea  Cliff,  and portions of the village of Old Brookville,
     5  village of Roslyn Harbor, and residents in the unincorporated hamlets of
     6  Glenwood Landing, Glen Head and the city of Glen Cove,  is  fragile  and
     7  subject  to episodic deficiencies of varying magnitude including service
     8  disruptions and drastic price variations to residents  serviced  by  the
     9  existing  private  water company. The groundwater supply requires better
    10  management of its entire reserve both within and outside the water util-
    11  ity supply area as well as long range planning to provide protection  of
    12  important  watershed  areas,  water  conservation,  and  prevention from
    13  contamination and salt water intrusion. Since the potable water for  the
    14  northern portion of the North Shore peninsula is derived from an aquifer
    15  which  is the sole source of water for all of Long Island, the issues of
    16  contamination and conservation are of statewide concern. The problems of
    17  salt water intrusion facing the North Shore peninsula, face  many  other
    18  peninsulas  on  Long Island and many of the barrier islands. It is hoped
    19  that the authority created by this act will not only  protect,  preserve
    20  and  enhance  the  quality  and  quantity of the water within its supply

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD13297-06-0

        S. 6491--B                          2

     1  area, but that it will also serve as a model and as a leader in  foster-
     2  ing  cooperation  with  other water suppliers to better manage, conserve
     3  and protect the groundwater within and outside its supply area.
     4    §  2.  Article  5 of the public authorities law is amended by adding a
     5  new title 5-a to read as follows:
     6                                  TITLE 5-A
     7                         NORTH SHORE WATER AUTHORITY
     8  Section 1114-a. Short title.
     9          1114-b. Definitions.
    10          1114-c. Water authority of North Shore district.
    11          1114-d. Water authority of North Shore.
    12          1114-e. Powers of the authority.
    13          1114-f. Transfer of officers and employees.
    14          1114-g. Bonds of the authority.
    15          1114-h. Remedies of bondholders.
    16          1114-i. State and municipalities not liable on authority bonds.
    17          1114-j. Moneys of the authority.
    18          1114-k. Bonds; legal investments for fiduciaries.
    19          1114-l. Agreement with the state.
    20          1114-m. Exemption from  taxes,  assessments  and  certain  fees;
    21                    payments in lieu of taxes.
    22          1114-n. Actions against the authority.
    23          1114-o. Conflicts  of interest of members of the board of direc-
    24                    tors and officers and employees of the authority.
    25          1114-p. Construction and purchase contracts.
    26          1114-q. Separability clause.
    27          1114-r. Effect of inconsistent provisions.
    28          1114-s. Acquisition by eminent domain.
    29    § 1114-a. Short title. This title may be cited as the "Water Authority
    30  of North Shore Act".
    31    § 1114-b. Definitions. As used or referred to in this title, unless  a
    32  different meaning clearly appears from the context:
    33    1.  "Authority"  shall  mean the corporation created by section eleven
    34  hundred fourteen-d of this title.
    35    2. "Board of directors" shall mean the governing board of the authori-
    36  ty.
    37    3. "Bonds" shall mean the bonds, notes or other evidences  of  indebt-
    38  edness issued by the authority pursuant to this title.
    39    4.  "Calendar  year"  shall  mean the twelve month period from January
    40  first through December thirty-first.
    41    5. "Chief executive officer" when referring to  a  municipality  shall
    42  mean the chief elected official of such municipality and, when referring
    43  to the authority, shall mean the chairperson of the authority.
    44    6.  "Civil service commission" shall mean the civil service commission
    45  of the county of Nassau.
    46    7. "Comptroller" shall mean the comptroller of the state of New York.
    47    8. "Construction" shall mean the negotiation,  acquisition,  erection,
    48  building,   alteration,  improvement,  testing,  increase,  enlargement,
    49  extension, reconstruction, interconnection, renovation or rehabilitation
    50  of a water facility as defined  in  this  section;  the  inspection  and
    51  supervision   thereof;   and   the  engineering,  architectural,  legal,
    52  appraisal, fiscal, economic and environmental  investigations,  services
    53  and  studies, surveys, designs, plans, working drawings, specifications,
    54  procedures and other actions incidental thereto.
    55    9. "Costs", as applied to any  project,  shall  include  the  cost  of
    56  construction,  the  cost  of  the acquisition of all property, including

        S. 6491--B                          3

     1  both real, personal and mixed, the  cost  of  demolishing,  removing  or
     2  relocating  any  buildings  or structures on lands so acquired including
     3  the cost of acquiring any land to which such buildings or structures may
     4  be  moved  or relocated, the cost of all systems, facilities, machinery,
     5  apparatus and equipment, financing charges and bond  discount,  interest
     6  to  the  extent not paid or provided for from revenues or other sources,
     7  the cost of engineering and architectural surveys, plans and  specifica-
     8  tions,  bond  insurance,  bond  credit  enhancement  arrangements, other
     9  expenses necessary or incidental to the construction of such project and
    10  the financing of the construction thereof, including the cost  of  legal
    11  and financial advices and credit arrangements with banks or other finan-
    12  cial  institutions,  the  amount  authorized  in  the  resolution of the
    13  authority providing for the issuance  of  bonds  to  be  paid  into  any
    14  reserve  or special fund from the proceeds of such bonds and the financ-
    15  ing of the placing of any project in operation, including the reimburse-
    16  ment to any municipality, state agency, the  state,  the  United  States
    17  government, or any other person for expenditures made by them that would
    18  be  costs  of  the project hereunder, notwithstanding the fact that such
    19  expenditures may have been incurred prior to the effective date of  this
    20  title.
    21    10. "County" shall mean the county of Nassau.
    22    11.  "Distribution system" shall mean the water facility or facilities
    23  employed to deliver water from a transmission facility, or  where  there
    24  is  no  transmission  facility,  from a supply facility, to the ultimate
    25  consumers of water.
    26    12. "District" shall mean the water authority  of  North  Shore  water
    27  district created by section eleven hundred fourteen-c of this title.
    28    13. "Governing body" shall mean:
    29    (a)  in the case of a city, county, town or village or district corpo-
    30  ration, the finance board as such term is defined in the  local  finance
    31  law; or
    32    (b) in the case of a public benefit corporation, the members thereof.
    33    14. "Members" shall mean the members of the board of directors.
    34    15. "Municipality" shall mean any city, county, town, village or coun-
    35  ty or town acting on behalf of an improvement district.
    36    16."Real property" shall mean lands, structures, franchises and inter-
    37  ests in land, waters, lands under water, groundwater riparian rights and
    38  air rights and any and all things and rights customarily included within
    39  the  term "real property" and includes not only fee simple absolute, but
    40  also any and all lesser interests including, but not limited  to,  ease-
    41  ments,  rights  of way, uses, leases, licenses and all other incorporeal
    42  hereditaments and every estate, interest or right, legal  or  equitable,
    43  including  terms  for years and liens thereon by way of judgments, mort-
    44  gages or otherwise.
    45    17. "State sanitary code" shall mean regulations adopted  pursuant  to
    46  section two hundred twenty-five of the public health law.
    47    18. "State" shall mean state of New York.
    48    19.  "State agency" shall mean any state office, public benefit corpo-
    49  ration, department, board, commission,  bureau  or  division,  or  other
    50  agency or instrumentality of the state.
    51    20.  "Supply  facility"  shall  mean a water facility employed to make
    52  groundwater or surface water available for delivery into a  transmission
    53  facility or distribution system.
    54    21.  "System  revenues"  shall  mean  all rates, rents, fees, charges,
    55  payments and other income and receipts derived from users of the author-
    56  ity  without  limiting  the  generality  of  the  foregoing,  investment

        S. 6491--B                          4

     1  proceeds  and proceeds of insurance, condemnation, sales or other dispo-
     2  sitions of assets, together with all federal, state or municipal aid  as
     3  well as any other income derived from the operation of the water facili-
     4  ty of the authority.
     5    22.  "Transmission facility" shall mean a water facility used to carry
     6  water from a supply facility to a distribution system.
     7    23. "Treasurer" shall mean the treasurer of the authority.
     8    24. "Water facility" or "water  facilities"  shall  mean  any  plants,
     9  structures  and other real and personal property acquired, rehabilitated
    10  or constructed for the purpose of supplying, transmitting,  distributing
    11  or  treating  water, including but not limited to surface or groundwater
    12  reservoirs, basins, dams, canals, aqueducts, standpipes, conduits, pipe-
    13  lines, mains, pumping stations, water distribution systems, compensating
    14  reservoirs, intake stations, waterworks  or  sources  of  water  supply,
    15  wells,  purification  or filtration plants or other treatment plants and
    16  works, connections, water meters, rights of  flowage  or  diversion  and
    17  other  plants,  structures,  equipment,  towers,  conveyances,  real  or
    18  personal property or rights therein and appurtenances thereto  necessary
    19  or  useful  and  convenient  for the accumulation, supply, transmission,
    20  treatment or distribution of water.
    21    25. "Water project" shall mean any water facility, including the plan-
    22  ning, development, financing or construction thereof.
    23    26. "Watershed rules" shall mean the rules and regulations made by the
    24  department of health pursuant to section eleven hundred  of  the  public
    25  health law.
    26    §  1114-c.  Water  authority  of North Shore district. There is hereby
    27  created a district to be known as the "water authority  of  North  Shore
    28  district"  which  shall  be defined as all that portion of Nassau county
    29  being serviced by the New York American water service corporation as its
    30  sea cliff operations district as of January first, two thousand eighteen
    31  and lying north of the area serviced by Jericho water district.
    32    § 1114-d. Water authority of North Shore. 1. A  corporation  known  as
    33  "water  authority of North Shore" is hereby created for the purposes and
    34  charged with the duties and having the powers provided  in  this  title.
    35  The  authority  shall  be a corporate governmental agency constituting a
    36  public benefit corporation and shall be  a  "public  district"  for  the
    37  purposes of section eighty-nine of the public service law. The authority
    38  shall be governed by a board of directors consisting of six members. The
    39  governing  boards  of  the villages of Old Brookville, Sea Cliff, Roslyn
    40  Harbor, and the City of Glen Cove shall each  appoint  one  member.  The
    41  governing  board  of  the  Town  of Oyster Bay shall appoint two members
    42  representing the residents of the unincorporated hamlets  of  Glen  Head
    43  and  Glenwood  Landing  who are serviced by the water authority of North
    44  Shore. Each member shall serve for a period of  two  years.  Each  chief
    45  executive  officer  shall file with the secretary of state a certificate
    46  of appointment or reappointment of any member appointed  or  reappointed
    47  by  such  chief executive within thirty days of the appointment or reap-
    48  pointment. Members shall receive no compensation for their services  but
    49  shall  be entitled to reimbursement of their necessary expenses, includ-
    50  ing traveling expenses, incurred in the discharge of their duties. Noth-
    51  ing in this section shall be construed as preventing a  chief  executive
    52  officer  of  a  municipality  from appointing himself or herself to be a
    53  member of the board of directors.
    54    2. If the authority decides to enter into a contract  to  purchase  or
    55  otherwise  acquire  an  interest  in the New York American water service
    56  corporation or to initiate a condemnation  proceeding  pursuant  to  the

        S. 6491--B                          5

     1  eminent  domain  procedure law for the area it services within the water
     2  authority of North Shore district, prior to entering into  any  contract
     3  to  purchase  or  otherwise acquire an interest in the New York American
     4  water service corporation or the initiation of any condemnation proceed-
     5  ing  by  the  authority pursuant to the eminent domain procedure law for
     6  the area it services within the water authority of North Shore district,
     7  the authority shall provide ratepayers within the area serviced  by  the
     8  New  York  American water service corporation and the public with public
     9  forums for  the  expression  and  discussion  of  views  regarding  such
    10  purchase,  acquisition  or  condemnation  of the New York American water
    11  service corporation. The authority shall hold at least one forum in each
    12  of the towns of North Hempstead, Oyster Bay, and city of Glen Cove with-
    13  in the portions of the towns of North Hempstead and Oyster Bay  and  the
    14  city of Glen Cove serviced by the New York American water service corpo-
    15  ration.
    16    3.  If  the  authority decides to enter into a contract to purchase or
    17  otherwise acquire an interest in the New  York  American  water  service
    18  corporation  or  to  initiate  a condemnation proceeding pursuant to the
    19  eminent domain procedure law for the area it services within  the  water
    20  authority  of  North  Shore  district,  the  authority  is authorized to
    21  provide registered voters within the area serviced by the New York Amer-
    22  ican water service corporation within the water authority of North Shore
    23  district prior to entering into such contract to purchase  or  otherwise
    24  acquire  an  interest in the New York American water service corporation
    25  or the initiation of any condemnation proceeding by the authority pursu-
    26  ant to the eminent domain procedure law for the area the New York Ameri-
    27  can water service corporation services within  the  water  authority  of
    28  North  Shore  district,  with a nonbinding referendum, regarding whether
    29  the authority should enter into a  contract  to  purchase  or  otherwise
    30  acquire  an  interest in the New York American water service corporation
    31  or initiate condemnation proceedings  pursuant  to  the  eminent  domain
    32  procedure  law  for  the  area it services within the water authority of
    33  North Shore district. The proposition shall be placed on the ballot  and
    34  voted  upon  at  a  special  election  or a date to be determined by the
    35  Nassau county board of elections.
    36    4. Any one or more of the members of the board of directors may be  an
    37  official  or an employee of a municipality situated within the district.
    38  In the event that an official or an employee of such municipality  shall
    39  be  elected  as  a  member  of  the  board  of  directors, acceptance or
    40  retention of such appointment shall not be deemed a forfeiture of his or
    41  her municipal office or employment, or incompatible therewith or  affect
    42  his or her tenure or compensation in any way.
    43    5.  No  action  shall be taken by the authority except pursuant to the
    44  favorable vote of fifty-one  percent  of  the  total  authorized  voting
    45  strength of the board of directors. The total authorized voting strength
    46  of the board of directors shall be:
    47    (a) The number of weighted votes possessed by each member of the board
    48  of  directors shall be determined in accordance with paragraphs (b), (c)
    49  and (d) of this subdivision, except  each  member  shall  possess  equal
    50  weighted votes prior to the adjustment pursuant to paragraph (d) of this
    51  subdivision;
    52    (b)  No  action shall be taken by the authority except pursuant to the
    53  favorable vote of at least: (i) fifty-one percent of the  total  author-
    54  ized  voting  strength of the board of directors; and (ii) three members
    55  of the board of directors, at least two of whom shall be from among  the

        S. 6491--B                          6

     1  four members of the board of directors possessing the greatest number of
     2  weighted votes;
     3    (c)  The  vote of each member shall be equal to one hundred multiplied
     4  by a fraction, the numerator of which shall be equal to the quantity  of
     5  water  supplied  by  the authority to the owners, tenants, occupants and
     6  other water users  in  the  municipality  from  which  such  member  was
     7  appointed and the denominator of which shall be equal to the quantity of
     8  water  supplied  by  the authority to the owners, tenants, occupants and
     9  other water users in all of the municipalities within the district; and
    10    (d) Commencing on the first day of January, two  thousand  twenty-two,
    11  and  every four years thereafter, the authorized number of votes of each
    12  member shall be adjusted in accordance with the  formula  set  forth  in
    13  paragraph (c) of this subdivision to reflect the total quantity of water
    14  supplied  by the authority to owners, tenants, occupants and other water
    15  users in each municipality within the district during the  two  calendar
    16  years  immediately  preceding  the date on which the adjustment is being
    17  made.
    18    6. The powers of the authority shall be vested in and shall  be  exer-
    19  cised  by the board of directors at a meeting duly called and held. Four
    20  members of the board of directors, who together are authorized to cast a
    21  majority of the weighted vote, shall constitute a quorum. The  board  of
    22  directors  may delegate to one or more of its members, or to one or more
    23  of the officers, agents or employees of the authority, such  powers  and
    24  duties as it may deem proper.
    25    7.  The officers of the authority shall consist of a chairperson, vice
    26  chairperson, deputy chairperson, treasurer, and secretary, who shall not
    27  be members of the board of directors.  The  officers  of  the  authority
    28  shall be appointed by the board of directors. The board of directors may
    29  appoint  and  at  its pleasure remove an attorney and an engineer, which
    30  positions, in addition to the officers above  named,  shall  be  in  the
    31  exempt  class  of  the  civil  service  and such additional officers and
    32  employees as it may require for the performance of its duties,  fix  and
    33  determine  their  qualifications,  duties,  compensations  and  terms of
    34  office or tenure, subject to the provisions of the civil service law  of
    35  the  state  and such rules as the civil service commission may adopt and
    36  make applicable to the authority. The authority may also  from  time  to
    37  time  contract for expert professional services. The duties of the offi-
    38  cers shall be as follows:
    39    (a) Chairperson. The chairperson shall be the chief executive  officer
    40  of  the  authority and it shall be the responsibility of the chairperson
    41  to:
    42    (i) preside at all meetings of the board of directors and of the offi-
    43  cers;
    44    (ii) manage the water facility,  the  transmission  facility  and  the
    45  distribution  system  and  to  effectuate  the decisions of the board of
    46  directors;
    47    (iii) exercise supervision  over  the  conduct  of  the  officers  and
    48  employees of the authority;
    49    (iv)  report  annually to each customer, either by mail or by publica-
    50  tion once in a newspaper having general circulation within the district;
    51  such report shall include but not be limited to the  following  informa-
    52  tion:
    53    (1)  a  brief  financial  account  on  operations  of the water system
    54  including, but not limited to, water rates,  total  revenues,  operating
    55  and maintenance expenses, and interest on bonds and notes;
    56    (2) the population served by the authority;

        S. 6491--B                          7

     1    (3)  the number of wells, towers and other storage facilities operated
     2  by the authority;
     3    (4)  the  total  pumpage  of groundwater including the amount received
     4  through interdistrict interconnections and  the  estimated  amount  lost
     5  from the system;
     6    (5)  the single highest level from each well of each synthetic organic
     7  chemical, nitrate and chloride constituent tested for by  the  authority
     8  at  any  time  during the year which exceeds the applicable county water
     9  quality standard or guideline, that standard or guideline, the  site  of
    10  each  well at which each reported constituent was found, and the date on
    11  which each reported constituent was analyzed;
    12    (6) the highest level from each well of each synthetic organic  chemi-
    13  cal, nitrate and chloride constituent tested for by the authority at any
    14  time  during  the year which does not exceed the applicable county water
    15  standard or guideline, but which contains a level equal  to  or  greater
    16  than  two-thirds  of the amount permitted before exceeding a standard or
    17  guideline, that standard or guideline, the site of each  well  at  which
    18  each  reported constituent was found and the date on which each reported
    19  constituent was analyzed;
    20    (7) once every five  years,  the  highest  level  of  any  constituent
    21  discovered  within  the distribution system which contains a level equal
    22  to or greater than two-thirds of the amount permitted before exceeding a
    23  standard or guideline, that standard or  guideline,  and  the  resulting
    24  action taken by the authority;
    25    (8)  any well restricted, removed from service or otherwise limited in
    26  its use and the cause for such action;
    27    (9) any actions taken to secure new supplies or replace lost capacity;
    28    (10) the types of treatment which the water receives  before  entering
    29  the distribution system;
    30    (11)  any compliance activities required by regulations of the depart-
    31  ment of environmental conservation or the department of  health  or  any
    32  local health department and any instances of noncompliance;
    33    (12)  the present condition of the distribution system and any signif-
    34  icant actions, as determined by the authority, to  improve  or  maintain
    35  the system;
    36    (13)  any  special  public  services the authority provides during the
    37  year; and
    38    (14) information on water conservation measures customers  can  imple-
    39  ment,  such  as,  but  not  limited  to, retrofitting plumbing fixtures,
    40  altering irrigation timing, using irrigation  sensors,  leak  detection,
    41  proper  use  of  water-consuming  appliances, daily conscientious use of
    42  water and estimated savings of water, energy, and  money,  from  use  of
    43  these measures;
    44    (v) execute all contracts in the name of the authority;
    45    (vi)  institute, at the direction of the board of directors, all civil
    46  actions in the name of the authority;
    47    (vii) provide for the enforcement of all of the rules and  regulations
    48  of the authority and cause all violations thereof to be prosecuted;
    49    (viii)  sign  orders  to  pay  claims  when authorized by the board of
    50  directors;
    51    (ix) sign checks in the absence or inability of the treasurer or depu-
    52  ty treasurer, if any, when authorized by the board of directors;  and  a
    53  certified  copy of a resolution of the board of directors to that effect
    54  shall be notice to the depository of such authorization;

        S. 6491--B                          8

     1    (x) appoint, subject to the approval of the board of directors,  none-
     2  lected  officers,  counsel,  accountants,  and other financial advisors,
     3  engineers and other technical advisors;
     4    (xi)  employ,  promote and discharge managers, supervisors and employ-
     5  ees; and
     6    (xii) take all other reasonable and necessary actions to carry out his
     7  or her office as the chief executive of the  authority.  If  the  chair-
     8  person  has  not been appointed as a member of the board of directors of
     9  the authority pursuant to this section, such chairperson shall be deemed
    10  an ex officio member of the board of directors. Such  status  shall  not
    11  carry  with  it  the right to vote on matters coming before the board of
    12  directors nor shall the presence of such chairperson be counted for  the
    13  purpose of determining a quorum.
    14    (b)  Vice  chairperson.  The vice chairperson shall perform all duties
    15  delegated to him or her by the chairperson and, in the absence or during
    16  the disability of the chairperson, the vice  chairperson  shall  act  as
    17  chairperson.
    18    (c)  Deputy  chairperson.  The  deputy  chairperson  shall perform all
    19  duties delegated to him or her by the chairperson  or  the  vice  chair-
    20  person.
    21    (d)  Secretary.  (i)  The  secretary shall be the recording and corre-
    22  sponding officer of the authority and the custodian of  the  records  of
    23  the authority.
    24    (ii)  The  secretary  shall  prepare  and send required notices of all
    25  meetings when directed to do so by the chairperson  or  by  the  written
    26  request of four members who have specified the issues to be discussed at
    27  the meeting.
    28    (iii)  In  the absence or disability of the secretary, the chairperson
    29  may appoint a temporary secretary.
    30    (e) Treasurer. (i) The treasurer shall  have  custody  of  all  moneys
    31  belonging to the authority and keep accounts of all receipts and expend-
    32  itures  in  conformance with a uniform system of accounts formulated and
    33  prescribed by the comptroller pursuant  to  section  thirty-six  of  the
    34  general municipal law.
    35    (ii) The treasurer shall execute a bond, conditioned upon the faithful
    36  performance  of  the  duties of his or her office, the amount and suffi-
    37  ciency of which shall be approved by the  board  of  directors  and  the
    38  premium therefor shall be paid by the authority.
    39    (iii) The treasurer shall deposit, within ten days after receipt ther-
    40  eof,  in  the  name of the authority, in one or more banks, and/or trust
    41  companies, designated by the board of directors, all moneys received  by
    42  him or her.
    43    (iv) The treasurer may sign checks with the facsimile signature of the
    44  treasurer,  as  reproduced  by  a  machine or device commonly known as a
    45  checksigner, when authorized by the board of directors.
    46    (v) The treasurer shall pay out moneys  from  the  authority  treasury
    47  only  as  authorized  by  the  board  of  directors and by law. All such
    48  payments, except as may be authorized by the board of  directors  for  a
    49  petty cash account, shall be by check.
    50    (vi) The treasurer shall issue a report on the finances of the author-
    51  ity at each regular meeting of the board of directors.
    52    (vii)  The treasurer shall file in the office of the authority, within
    53  sixty days after the end of the fiscal  year,  a  statement  showing  in
    54  detail all revenues and expenditures during the previous fiscal year and
    55  the  outstanding  indebtedness  of  the  authority  as of the end of the
    56  fiscal year. The members shall, within ten days, cause to  be  published

        S. 6491--B                          9

     1  once  in  a  newspaper having general circulation within the district, a
     2  notice that the annual financial statement has been filed and is  avail-
     3  able for inspection or a summary of such statement in a form approved by
     4  the comptroller, with an endorsement thereon that details thereof are on
     5  file  in  the  office  of  the  authority. The members shall cause to be
     6  audited by a certified public accountant engaged for that purpose,  such
     7  report and supporting records.
     8    8.  The  terms  of the chairperson, vice chairperson and deputy chair-
     9  person  first  appointed  shall  be  staggered,  the  chairperson  first
    10  appointed  shall  serve for a period of four years, the vice chairperson
    11  first appointed shall serve for a period of three years and  the  deputy
    12  chairperson first appointed shall serve for a period of two years; ther-
    13  eafter their successors shall serve for terms of four years. The remain-
    14  ing officers shall each serve terms of one year.  The board of directors
    15  shall have the right, at any time, to extend any such term, for a period
    16  of  months,  to provide that such term terminates contemporaneously with
    17  the end of the fiscal year of the authority.
    18    9. The officers of the authority shall receive such  compensation  for
    19  their  services as shall be fixed by the board of directors and shall be
    20  reimbursed for all necessary and actual expenses incurred in  connection
    21  with  their  duties as such officers and in connection with the carrying
    22  out of the purposes of this title.
    23    10. The authority and its corporate  existence  shall  continue  until
    24  terminated by law; provided, however, that no such law shall take effect
    25  so long as the authority shall have bonds or other obligations outstand-
    26  ing unless adequate provision has been made for the payment or satisfac-
    27  tion thereof. Upon termination of the existence of the authority, all of
    28  the  rights and properties of the authority then remaining shall pass to
    29  and vest in the municipalities within the district. Such property  shall
    30  be  apportioned  and  distributed  among  the  municipalities within the
    31  district in direct proportion to their weighted voting on  the  date  of
    32  the termination of the authority.
    33    11. In addition to any powers granted to it by law, the governing body
    34  of  each  of  the municipalities within the district, from time to time,
    35  may appropriate sums of money to defray project costs or any other costs
    36  and expenses of the authority.  Subject to the  rights  of  bondholders,
    37  each governing body may determine if the moneys so appropriated shall be
    38  subject to repayment by the authority to the municipalities, and in such
    39  event, the manner and time or times for such repayment.
    40    12.  Neither  the  public  service  commission  nor any other board or
    41  commission of like character, shall have jurisdiction over the authority
    42  in the management and control of its properties  or  operations  or  any
    43  power  over  the  regulation  of rates fixed or charges collected by the
    44  authority.
    45    13. It is hereby determined and declared that the  authority  and  the
    46  carrying  out of its powers, purposes and duties are in all respects for
    47  the benefit of the people of the municipalities within the district  and
    48  state,  for  the improvement of their health, welfare and prosperity and
    49  that the said purposes are public purposes and that the authority is and
    50  will be performing an essential governmental function in the exercise of
    51  the powers conferred upon it by this title.
    52    § 1114-e. Powers of the authority. Except as otherwise limited by this
    53  title, the authority shall have the power to:
    54    1. sue and be sued;
    55    2. have a seal and alter the same at pleasure;

        S. 6491--B                         10

     1    3. borrow money and issue negotiable or non-negotiable  notes,  bonds,
     2  or other obligations and to provide for the rights of the holders there-
     3  of;
     4    4.  enter  into  contracts  and  execute  all instruments necessary or
     5  convenient or desirable for the purposes of the authority to  carry  out
     6  any powers expressly given it in this title;
     7    5.  acquire,  by purchase, gift, grant, transfer, contract or lease or
     8  by condemnation pursuant to the eminent domain procedure law,  lease  as
     9  lessee, hold and use and to sell, lease as lessor, transfer or otherwise
    10  dispose of, any real or personal property or any interest therein, with-
    11  in  or  without  the  district, but within the territorial limits of the
    12  town of Oyster Bay or North Hempstead, as the authority may deem  neces-
    13  sary,  convenient  or  desirable to carry out the purpose of this title;
    14  provided, however, that the authority may not condemn real property of a
    15  municipality without the consent of the governing body of  such  munici-
    16  pality;
    17    6.  purchase,  in  the name of the authority, any water supply system,
    18  including plants, works, instrumentalities or parts thereof and appurte-
    19  nances thereto, lands, easements,  rights  in  land  and  water  rights,
    20  rights-of-way,   contract   rights,   franchises,  permits,  approaches,
    21  connections, dams, wells, pumps, reservoirs, water mains and pipe lines,
    22  pumping stations, treatment facilities, meters, equipment and inventory,
    23  or any other property incidental to and included in such system or  part
    24  thereof,  and  any  improvements,  extensions  and betterments, situated
    25  wholly within the district, provided, however, that the authority  shall
    26  have  the power to purchase any source of supply, or water supply system
    27  or any part thereof situated wholly or partly  without  the  territorial
    28  limits  of  the  district,  provided same shall be necessary in order to
    29  supply water within the district and in connection with the purchase  of
    30  such properties the authority may assume any obligations of the owner of
    31  such  properties  and, to the extent required by the terms of any inden-
    32  tures or other instruments under which such obligations were issued, the
    33  authority may assume and agree to  perform  covenants  and  observe  the
    34  restrictions contained in such instruments; and furthermore the owner of
    35  any  properties, which the authority is authorized to acquire, is hereby
    36  authorized to sell or otherwise transfer  the  same  to  the  authority,
    37  whereupon the authority shall become charged with the performance of all
    38  public  duties with respect to such properties with which such owner was
    39  charged and such owner shall  become  discharged  from  the  performance
    40  thereof,  as a means of so acquiring for such purpose, the authority may
    41  purchase all of the stock of any existing privately owned  water  corpo-
    42  ration or company and in the case of a sale or other transfer of proper-
    43  ties  of  a  public utility corporation pursuant to this provision, upon
    44  the purchase of the stock of such corporation or  company  it  shall  be
    45  lawful to dissolve such corporation within a reasonable time;
    46    7. construct, improve or rehabilitate water supply facilities required
    47  for the maintenance, development or expansion of water supply sources;
    48    8. operate and manage and to contract for the operation and management
    49  of facilities of the authority;
    50    9.  enter  into  contracts,  and  carry out the terms thereof, for the
    51  wholesale provision of water produced by supply  facilities  constructed
    52  and  operated  by  the  authority,  to  municipalities and private water
    53  companies and to carry out the terms thereof, for  the  transmission  of
    54  water from new or existing supply facilities;
    55    10.  apply  to  the appropriate agencies and officials of the federal,
    56  state and local governments for such licenses, permits or  approvals  of

        S. 6491--B                         11

     1  its  plans  or  projects as it may deem necessary or advisable, and upon
     2  such terms and conditions as it may deem appropriate, to accept, in  its
     3  discretion, such licenses, permits or approvals as may be tendered to it
     4  by such agencies and officials;
     5    11.  take  all necessary and reasonable actions within the district to
     6  conserve, preserve and protect the water supply to the district, includ-
     7  ing the making of plans and studies, the adoption of watershed rules and
     8  regulations, the enforcing of compliance with  all  current  and  future
     9  rules  and  regulations  of the state sanitary code with regard to water
    10  supply and  usage,  the  requiring  of  cross-connection  controls,  the
    11  providing  of  educational  material and programs to the public, and the
    12  cooperating with water  suppliers  outside  the  district  to  conserve,
    13  preserve  and  protect the entire water reserve as it is affected within
    14  and outside the authority's supply area;
    15    12. retain or employ counsel, auditors, engineers and private consult-
    16  ants on a contract basis or  otherwise  for  rendering  professional  or
    17  technical services and advice;
    18    13.  make plans and studies necessary, convenient or desirable for the
    19  effectuation of the purposes and powers of the authority and to  prepare
    20  recommendations in regard thereto;
    21    14. prepare a water supply emergency plan which shall include, but not
    22  be limited to, the following:
    23    (a)  establishment  of  criteria  and procedures to determine critical
    24  water levels or safe yield of system;
    25    (b) identification of existing  and  future  sources  of  water  under
    26  normal conditions and emergency conditions;
    27    (c)  system  capacity  and  ability to meet peak demand and fire flows
    28  concurrently;
    29    (d) storage capacities;
    30    (e) current condition of present interconnections  and  identification
    31  of additional interconnections to meet a water supply emergency;
    32    (f)  a specific action plan to be followed during a water supply emer-
    33  gency including a phased implementation of the plan;
    34    (g) general water conservation programs and water use reduction strat-
    35  egies for water supply users;
    36    (h) prioritization of water users;
    37    (i) identification and  availability  of  emergency  equipment  needed
    38  during a water supply emergency; and
    39    (j)  a  public notification program coordinated with the phased imple-
    40  mentation schedule; such plan shall not be adopted until a public  hear-
    41  ing on such plan shall have been held, upon not less than fourteen days'
    42  notice  thereof  to each customer, either by mail or by publication once
    43  in a newspaper having general circulation  within  the  district;  every
    44  five years, such plan shall be reviewed and revised if necessary after a
    45  public hearing, with notice to each customer as aforesaid;
    46    15.  enter  upon such lands, waters, or premises as in the judgment of
    47  the authority shall be necessary for  the  purpose  of  making  surveys,
    48  soundings, borings and examinations to accomplish any purpose authorized
    49  by this title, the authority being liable only for actual damage done;
    50    16.  apply  for and to accept any gifts or grants or loans of funds or
    51  property or financial or other aid in any form from the federal  govern-
    52  ment  or any agency or instrumentality thereof, or from the state or any
    53  agency or instrumentality thereof, or from any other source, for any  or
    54  all  of  the purposes specified in this title, and to comply, subject to
    55  the provisions of this title, with the terms and conditions thereof;

        S. 6491--B                         12

     1    17. obtain, store, treat, distribute, supply and sell water for domes-
     2  tic, commercial and public purposes at retail  to  individual  consumers
     3  within the district;
     4    18.   purchase  water  from  any  municipal  corporation,  town  water
     5  district, person, association or corporation;
     6    19. produce, develop, distribute and  sell  water  or  water  services
     7  within  or  without  the  territorial  limits of the district; provided,
     8  however, that water may be sold at retail to individual  consumers  only
     9  within  the  district and further provided that in exercising the powers
    10  granted by this title, the authority shall not sell water  in  any  area
    11  which is served by a water system owned or operated by a municipality or
    12  special  improvement  district unless the governing body of such munici-
    13  pality or district shall adopt a resolution requesting the authority  to
    14  sell water in such served areas;
    15    20.  make  bylaws for the management and regulation of its affairs and
    16  rules and regulations for the conservation, preservation and  protection
    17  of  the  authority's  water supply and, subject to agreements with bond-
    18  holders, rules for the sale of water and the  collection  of  rents  and
    19  charges  therefor.  A copy of such rules, regulations and bylaws and any
    20  rules and regulations adopted pursuant to  subdivision  eleven  of  this
    21  section,  and all amendments thereto, duly certified by the secretary of
    22  the authority shall be filed in the office of the municipalities  within
    23  the district and thereafter published once in a newspaper having general
    24  circulation within the district. Violation of such rules and regulations
    25  shall  be  punishable by fine, not exceeding fifty dollars, or by impri-
    26  sonment for not longer than thirty days, or both;
    27    21. fix rates and collect charges for the use of the facilities of, or
    28  services rendered by, or any commodities furnished by the authority such
    29  as to provide revenues sufficient at all times to pay, as the same shall
    30  become due, the principal and interest on  the  bonds,  or  other  obli-
    31  gations  of  the  authority  together  with  the  maintenance  of proper
    32  reserves therefor, in addition to paying as the same shall  become  due,
    33  the expense of operating and maintaining the properties of the authority
    34  together  with  proper  maintenance  reserves,  capital reserves, repair
    35  reserves, tax stabilization reserves and other contingency reserves, and
    36  all other obligations and indebtedness of  the  authority;  however,  no
    37  such  rates  or  charges shall be changed until a public hearing on such
    38  changes shall have been held upon not less than  fourteen  days'  notice
    39  thereof  to  each  customer,  either by mail or by publication once in a
    40  newspaper having general circulation within the district;
    41    22. enter into cooperative agreements with other authorities,  munici-
    42  palities,  counties,  cities,  towns, villages, water districts, utility
    43  companies, individuals, firms or corporations,  within  or  without  the
    44  territorial  limits  of  the district for the interconnection of facili-
    45  ties, the exchange or  interchange  of  services  and  commodities,  the
    46  conservation,  preservation  and  protection  of  the  authority's water
    47  reserve as it is affected within  and  outside  the  authority's  supply
    48  area,  and, within the territorial limits of the district, to enter into
    49  a contract for the construction, operation and maintenance  of  a  water
    50  supply  and  distribution  system  by the authority for any municipality
    51  having power to construct and develop a water  supply  and  distribution
    52  system,  upon  such  terms  and  conditions as shall be determined to be
    53  reasonable including, but not limited to the reimbursement of all  costs
    54  of  such  construction,  or  for  any other lawful purposes necessary or
    55  desirable to effect the purposes of this title;

        S. 6491--B                         13

     1    23. provide for the discontinuance or disconnection of the  supply  of
     2  water  for  nonpayment  of  fees, rates, rents or other charges therefor
     3  imposed by the authority, provided such discontinuance or  disconnection
     4  of any supply of water shall not be carried out except in the manner and
     5  upon  the  notice as is required of a waterworks corporation pursuant to
     6  subdivisions three-a, three-b and three-c of section  eighty-nine-b  and
     7  section one hundred sixteen of the public service law;
     8    24.  contract  for,  provide  and  maintain such insurance as it deems
     9  necessary or reasonable to:
    10    (a) secure and protect its real and personal property from fire, theft
    11  or other calamity or loss;
    12    (b) secure and protect it against liability imposed by law for damages
    13  for injuries to persons or property;
    14    (c) secure and protect it against any liability which may  be  imposed
    15  pursuant to section eighteen of the public officers law; and
    16    (d)  secure  and  protect  it against any other liability, casualty or
    17  loss as it deems necessary or reasonable; and
    18    25. do all things necessary, convenient or desirable to carry out  its
    19  purposes and for the exercise of the powers granted in this title.
    20    §  1114-f.  Transfer  of officers and employees. Any public officer or
    21  employee under civil service, selected by the authority  may,  with  the
    22  consent of the commission, board, department or municipality by which he
    23  or  she  has been employed, be transferred to the authority and shall be
    24  eligible for such transfer and appointment without examination to compa-
    25  rable offices, positions and employment under the authority. The  salary
    26  or  compensation of any such officer or employee shall after such trans-
    27  fer be paid by the authority, but notwithstanding the provisions of this
    28  title, any such officers or employees so transferred to  the  authority,
    29  pursuant  to the provisions of this section, who are members of or bene-
    30  ficiaries under any existing pension or retirement system, shall contin-
    31  ue to have all rights, privileges, obligations and status  with  respect
    32  to  such fund system or systems as are now prescribed by law, but during
    33  the period of their employment by the authority,  all  contributions  to
    34  any  pension  or retirement fund or system to be paid by the employer on
    35  account of such officers and employees, shall be paid by the  authority;
    36  and all such officers and employees who have been appointed to positions
    37  under  the  rules  and  classifications  of the civil service commission
    38  shall have the same status with respect thereto after  transfer  to  the
    39  authority as they had under their original appointments. The appointment
    40  and promotion of all employees of the authority shall be made in accord-
    41  ance  with the provisions of the civil service law and such rules as the
    42  civil service commission may adopt and make applicable to the authority.
    43    § 1114-g. Bonds of the authority. 1.  The  authority  shall  have  the
    44  power  and  is  hereby  authorized  from time to time to issue bonds, in
    45  conformity with applicable provisions of the uniform commercial code, in
    46  such principal amounts as it may determine to be necessary  to  pay  the
    47  cost  of  any  water  project  or  projects  or  for any other corporate
    48  purposes, including incidental expenses  in  connection  therewith.  The
    49  authority  shall have power from time to time to refund any bonds by the
    50  issuance of new bonds whether the bonds to be refunded have or have  not
    51  matured, and may issue bonds partly to refund bonds then outstanding and
    52  partly  for  any  other corporate purpose. Bonds issued by the authority
    53  may be general obligations secured  by  the  faith  and  credit  of  the
    54  authority or may be special obligations payable solely out of particular
    55  revenues  or  other  moneys of the authority as may be designated in the
    56  proceedings of the authority under which the bonds shall  be  authorized

        S. 6491--B                         14

     1  to  be issued, subject to any agreements with the holders of outstanding
     2  bonds pledging particular revenues or moneys.
     3    2. The authority is authorized to obtain from any department or agency
     4  of the United States of America or nongovernmental insurer any insurance
     5  or  guaranty,  or any other credit enhancement arrangement with any bank
     6  or other financial institution to the extent now or hereafter available,
     7  as to, or for the payment or repayment  of  interest  or  principal,  or
     8  both,  or  any part thereof, on any bonds issued by the authority and to
     9  enter into any agreement or contract with respect to any such  insurance
    10  or  guaranty, except to the extent that the same would in any way impair
    11  or interfere with the ability of the authority to  perform  and  fulfill
    12  the  terms  of  any  agreement made with the holders of the bonds of the
    13  authority.
    14    3. Bonds shall be authorized by resolution of the authority,  and  may
    15  be  in such denominations and bear such date or dates and mature at such
    16  time or times as such resolution may provide except that bonds  and  any
    17  renewal  thereof  shall  mature  within forty years of the date of their
    18  original issuance and notes and any renewal thereof shall mature  within
    19  five  years  of the date of their original issuance. Such bonds shall be
    20  subject to such terms of redemption,  bear  interest  at  such  rate  or
    21  rates,  which  may vary from time to time, as may be necessary to effect
    22  the sale thereof and shall be payable at such times, be  in  such  form,
    23  carry such registration privileges, be executed in such manner, be paya-
    24  ble in such medium of payment at such place or places, and be subject to
    25  such  terms  and conditions as such resolution may provide. Bonds may be
    26  sold at public sale or at private sale for such price or prices  as  the
    27  authority  shall  determine, provided that no issue of bonds may be sold
    28  at private sale unless the terms of such sale shall have  been  approved
    29  in writing by:
    30    (a) the comptroller, where such sale is not to the comptroller; or
    31    (b)  the  director  of  the division of the budget of the state, where
    32  such sale is to the comptroller.
    33    4. Any resolution or resolutions authorizing bonds  or  any  issue  of
    34  bonds  by  the authority may contain provisions which may be part of the
    35  contract with the holders of the bonds thereby authorized as to:
    36    (a) pledging all or part of its  revenues,  together  with  any  other
    37  moneys,  securities, contracts or property, to secure the payment of the
    38  bonds, subject to such agreements with bondholders as may then exist;
    39    (b) the rates, rentals,  fees  and  other  charges  to  be  fixed  and
    40  collected and the amounts to be raised in each year thereby, and the use
    41  and disposition of the earnings and other revenues;
    42    (c)  the  setting  aside of reserves and the creation of sinking funds
    43  and the regulation and disposition thereof;
    44    (d) limitations on the purpose to which the proceeds from the sale  of
    45  bonds may be applied;
    46    (e) limitations on the right of the authority to restrict and regulate
    47  the  use  of  any project or part thereof in connection with which bonds
    48  are issued;
    49    (f) limitations on the issuance of additional bonds,  the  terms  upon
    50  which additional bonds may be issued and the refunding of outstanding or
    51  other bonds;
    52    (g)  the  procedure,  if  any, by which the terms of any contract with
    53  bondholders may be amended or abrogated,  including  the  proportion  of
    54  bondholders  which  shall  consent  thereto and the manner in which such
    55  consent may be given;

        S. 6491--B                         15

     1    (h) the creation of special funds into which  any  revenues  or  other
     2  moneys may be deposited;
     3    (i)  the terms and provisions of any trust, deed or indenture securing
     4  the bonds under which the bonds may be issued;
     5    (j) vesting in a trustee or trustees such properties,  rights,  powers
     6  and  duties  in  trust as the authority may determine, which may include
     7  any or all of the rights, powers and duties of the trustee appointed  by
     8  the  bondholders  pursuant  to section eleven hundred fourteen-h of this
     9  title and limiting or  abrogating  the  rights  of  the  bondholders  to
    10  appoint  a trustee under such section or limiting the rights, duties and
    11  powers of such trustee;
    12    (k) defining the acts or omissions  to  act  which  may  constitute  a
    13  default  in the obligations and duties of the authority to the bondhold-
    14  ers and providing for the rights and remedies of the bondholders in  the
    15  event of such default, including as a matter of right the appointment of
    16  a  receiver,  provided, however, that such rights and remedies shall not
    17  be inconsistent with the general laws of the state and other  provisions
    18  of this title;
    19    (l)  limitations  on  the  power of the authority to sell or otherwise
    20  dispose of any system or any part thereof or other property;
    21    (m) limitations on the amount of  revenues  and  other  moneys  to  be
    22  expended for operating, administrative or other expenses of the authori-
    23  ty;
    24    (n)  the  protection and enforcement of the rights and remedies of the
    25  bondholders;
    26    (o) the obligations of the authority in relation to the  construction,
    27  maintenance,  operation,  repairs  and  insurance of the properties, the
    28  safeguarding and application of all moneys and as  to  the  requirements
    29  for  the  supervision and approval of consulting engineers in connection
    30  with construction, reconstruction and operation;
    31    (p) the payment of the proceeds of bonds, revenues and other moneys to
    32  a trustee or other depository, and for the method of disbursement there-
    33  of with such safeguards and restrictions as the authority may determine;
    34  and
    35    (q) any other matters of like or different character which in any  way
    36  affect  the  security or protection of the bonds or the rights and reme-
    37  dies of bondholders.
    38    5. In addition to the powers herein conferred upon  the  authority  to
    39  secure  its bonds, the authority shall have power in connection with the
    40  issuance of bonds to enter into such agreements  as  the  authority  may
    41  deem  necessary,  consistent or desirable concerning the use or disposi-
    42  tion of its revenues or other moneys or property, including  remarketing
    43  agreements  or other similar agreements for the bonds, the mortgaging of
    44  any property and the entrusting, pledging or creation of any other secu-
    45  rity interest in any such revenues, moneys, or property and the doing of
    46  any act, including refraining from doing any act,  which  the  authority
    47  would  have  the  right  to  do  in  the absence of such agreements. The
    48  authority shall have power to enter into amendments of any  such  agree-
    49  ments  within  the  powers granted to the authority by this title and to
    50  perform such agreements. The provisions of any such  agreements  may  be
    51  made a part of the contract with the holders of bonds of the authority.
    52    6.  Any  provision  of  the  uniform  commercial  code to the contrary
    53  notwithstanding, any pledge of or other security interest  in  revenues,
    54  moneys, accounts, contract rights, general intangibles or other personal
    55  property  made  or  created by the authority shall be valid, binding and
    56  perfected from the time when such  pledge  is  made  or  other  security

        S. 6491--B                         16

     1  interest  attaches  without  any  physical delivery of the collateral or
     2  further act, and the lien of any such pledge or other security  interest
     3  shall  be valid, binding and perfected against all parties having claims
     4  of  any  kind in tort, contract or otherwise against the authority irre-
     5  spective of whether or not such parties have notice thereof. No  instru-
     6  ment  by  which  such  a  pledge or security interest is created nor any
     7  financing statement need be recorded or filed.
     8    7. Whether or not the bonds of the authority  are  of  such  form  and
     9  character as to be negotiable instruments under the terms of the uniform
    10  commercial code, the bonds are hereby made negotiable instruments within
    11  the  meaning  of  and  for  all purposes of the uniform commercial code,
    12  subject only to the provisions of the bonds for registration.
    13    8. Neither the members of the board of directors nor the  officers  of
    14  the  authority nor any person executing bonds shall be liable personally
    15  thereon or be subject to any personal liability or accountability solely
    16  by reason of the issuance thereof.
    17    9. The authority, subject to such agreements with bondholders as  then
    18  may  exist,  shall  have  power  out of any moneys available therefor to
    19  purchase bonds of the authority in lieu of redemption, at  a  price  not
    20  exceeding:
    21    (a) if the bonds are then redeemable, the redemption price then appli-
    22  cable, plus accrued interest to the next interest payment date; or
    23    (b)  if  the  bonds are not then redeemable, the redemption price then
    24  applicable on the first date after such purchase upon  which  the  bonds
    25  become  subject to redemption plus accrued interest to the next interest
    26  payment date.
    27    10. The authority shall have power and is hereby authorized  to  issue
    28  negotiable   bond  anticipation  notes  in  conformity  with  applicable
    29  provisions of the uniform commercial code and may renew  the  same  from
    30  time  to  time  but  the  maximum  maturity  of any such note, including
    31  renewals thereof, shall not exceed five years from the date of issue  of
    32  such  original  note.  Such  notes  shall be paid from any moneys of the
    33  authority available therefor and  not  otherwise  pledged  or  from  the
    34  proceeds  of sale of the bonds of the authority in anticipation of which
    35  they were issued. The notes shall be issued in the same  manner  as  the
    36  bonds  and  such notes and the resolution or resolutions authorizing the
    37  same may contain any provisions, conditions  or  limitations  which  the
    38  bonds or bond resolution of the authority may contain. Such notes may be
    39  sold  at  public  sale  or,  upon the approval of the comptroller of the
    40  terms thereof, at private sale.  Such notes shall be as fully negotiable
    41  as the bonds of the authority.
    42    § 1114-h. Remedies of bondholders. 1. In the event that the  authority
    43  shall default in the payment of principal of or interest on any issue of
    44  the  bonds  after the same shall become due, whether at maturity or upon
    45  call for redemption, and such default shall continue  for  a  period  of
    46  thirty  days, or in the event that the authority shall fail or refuse to
    47  comply with the provisions of this title, or shall default in any agree-
    48  ment made with the holders of any issue of the  bonds,  the  holders  of
    49  twenty-five  per  centum  in  aggregate principal amount of the bonds of
    50  such issue then outstanding, by instrument or instruments filed  in  the
    51  office  of the clerk of the applicable county and proved or acknowledged
    52  in the same manner as a deed to be recorded, may appoint  a  trustee  to
    53  represent the holders of such bonds for the purposes herein provided.
    54    2.  Such trustee may, and upon written request of the holders of twen-
    55  ty-five per centum in principal amount of such bonds outstanding  shall,
    56  in his or her own name:

        S. 6491--B                         17

     1    (a)  by action or proceeding in accordance with the civil practice law
     2  and rules, enforce all rights of the bondholders and require the author-
     3  ity to carry out any other agreements with the holders of such bonds and
     4  to perform its duties under this title;
     5    (b) bring an action or proceeding upon such bonds;
     6    (c) by action or proceeding, require the authority to account as if it
     7  were the trustee of an express trust for the holders of such bonds;
     8    (d)  by  action  or proceeding, enjoin any acts or things which may be
     9  unlawful or in violation of the rights of the holders of such bonds; and
    10    (e) declare all such bonds due and payable, and if all defaults  shall
    11  be  made  good,  then with the consent of the holders of twenty-five per
    12  centum of the principal amount of such  bonds  then  outstanding,  annul
    13  such declaration and its consequences.
    14    3.  Such  trustee  shall in addition to the foregoing have and possess
    15  all of the powers necessary or appropriate for the exercise of any func-
    16  tions specifically set forth herein or incidental to the general  repre-
    17  sentation  of  bondholders  in  the  enforcement and protection of their
    18  rights.
    19    4. The state supreme court, county of Nassau and the state shall  have
    20  jurisdiction  of  any  action  or proceeding by the trustee on behalf of
    21  such bondholders.
    22    5. Before declaring the principal of bonds due and payable, the  trus-
    23  tee shall first give thirty days' notice in writing to the authority.
    24    §  1114-i.  State  and  municipalities  not liable on authority bonds.
    25  Neither the state nor any municipality shall be liable on the  bonds  of
    26  the  authority and such bonds shall not be a debt of the state or of any
    27  municipality.
    28    § 1114-j. Moneys of the authority. All moneys of  the  authority  from
    29  whatever  source  derived  shall  be  paid to the treasurer and shall be
    30  deposited forthwith in one or more banks and/or trust companies  in  the
    31  state  designated by the authority. The moneys in such accounts shall be
    32  paid out on checks of the treasurer upon requisition by the  chairperson
    33  of  the  authority or of such other officer or officers as the authority
    34  may authorize to make such requisitions. All  deposits  of  such  moneys
    35  shall be secured by obligations of or guaranteed by the United States of
    36  America  or  of  the  state  of a market value equal at all times to the
    37  amount on deposit and all banks and trust companies  are  authorized  to
    38  give  such  security  for such deposits. Any moneys of the authority not
    39  required for immediate use or disbursement may, at the discretion of the
    40  authority, be invested in those obligations specified  pursuant  to  the
    41  provisions  of  section  ninety-eight-a  of  the  state finance law. The
    42  authority shall have  power,  notwithstanding  the  provisions  of  this
    43  section,  to  contract  with the holders of any bonds as to the custody,
    44  collection, security, investment  and  payment  of  any  moneys  of  the
    45  authority  or  any  moneys held in trust or otherwise for the payment of
    46  bonds or in any way to secure bonds. Moneys held in trust  or  otherwise
    47  for  the  payment of bonds or in any way to secure bonds and deposits of
    48  such moneys may be secured in the same manner as moneys of the authority
    49  and all banks and trust companies are authorized to give  such  security
    50  for such deposits.
    51    §  1114-k.  Bonds; legal investments for fiduciaries. The bonds of the
    52  authority are hereby made securities in which all public  officials  and
    53  bodies  of the state and all municipalities, all insurance companies and
    54  associations and other persons carrying on an  insurance  business,  all
    55  banks, bankers, trust companies, savings banks and savings associations,
    56  including  savings and loan associations, investment companies and other

        S. 6491--B                         18

     1  persons carrying on a banking business, and  administrators,  guardians,
     2  executors,  trustees and other fiduciaries and all other persons whatso-
     3  ever, who are now or may hereafter be authorized to invest in  bonds  or
     4  other  obligations  of  the state, may properly and legally invest funds
     5  including capital in their control or belonging to them. The  bonds  are
     6  also  hereby  made  securities  which  may  be deposited with and may be
     7  received by all public officers and bodies of the state and all  munici-
     8  palities  for any purposes for which the deposit of bonds or other obli-
     9  gations of the state is now or hereafter may be authorized.
    10    § 1114-l. Agreement with the state. The state does  hereby  pledge  to
    11  and agree with the holders of any bonds issued by the authority pursuant
    12  to  this  title that the state will not alter or limit the rights hereby
    13  vested in the authority to fulfill the terms of any agreement made  with
    14  or  for  the  benefit  of  the holders of bonds or in any way impair the
    15  rights and remedies of bondholders until the  bonds  together  with  the
    16  interest  thereon, with interest on any unpaid installments of interest,
    17  and all costs and expenses in connection with any action  or  proceeding
    18  by  or  on  behalf  of  such  holders, are fully met and discharged. The
    19  authority is authorized to include this  pledge  and  agreement  of  the
    20  state in any agreement with bondholders.
    21    § 1114-m. Exemption from taxes, assessments and certain fees; payments
    22  in  lieu  of  taxes. 1. It is hereby determined that the creation of the
    23  authority and the carrying out of  its  corporate  purposes  is  in  all
    24  respects  for  the  benefit  of  the people of the state and is a public
    25  purpose, and the authority shall be regarded  as  performing  a  govern-
    26  mental  function in the exercise of the powers conferred upon it by this
    27  title and shall not be required to pay any  taxes,  special  ad  valorem
    28  levies  or special assessments upon any real property owned by it or any
    29  filing, recording or transfer fees or taxes in relation  to  instruments
    30  filed, recorded or transferred by it or on its behalf.
    31    2.  The authority may pay, or may enter into agreements with any muni-
    32  cipality to pay, a sum or sums annually or otherwise or to provide other
    33  considerations to such municipality with respect to real property  owned
    34  by  the  authority  located  within such municipality and constituting a
    35  part of its water system.
    36    3. Any bonds issued pursuant to this title together  with  the  income
    37  therefrom  shall  be exempt from taxation except for transfer and estate
    38  taxes. The revenues, moneys and all other property and all activities of
    39  the authority shall be exempt from all taxes and  governmental  fees  or
    40  charges,  whether  imposed  by  the state or any municipality, including
    41  without limitation real estate taxes,  income  taxes,  franchise  taxes,
    42  sales taxes or other excise taxes.
    43    4.  The state hereby covenants with the purchasers and with all subse-
    44  quent holders and transferees of bonds issued by the authority  pursuant
    45  to this title, in consideration of the acceptance of and payment for the
    46  bonds, that the bonds of the authority issued pursuant to this title and
    47  the  income  therefrom  shall be exempt from such taxation, as stated in
    48  subdivision three of this section, and that all  revenues,  moneys,  and
    49  other  property pledged to secure the payment of such bonds shall at all
    50  times be free from such taxes as stated in such subdivision.
    51    5. Notwithstanding the provisions of subdivisions one through four  of
    52  this  section,  nothing  herein shall prevent the state from assessing a
    53  tax or surcharge against  the  water  customers  based  on  their  water
    54  consumption,  provided,  however, that all such taxes and surcharges and
    55  the authority's obligation to collect and pay such taxes and  surcharges
    56  shall  be subordinate to the rights of holders of all of the authority's

        S. 6491--B                         19

     1  bonds and notes and to the payment of principal, premiums  if  any,  and
     2  interest thereon.
     3    §  1114-n.  Actions  against the authority. 1. Except in an action for
     4  wrongful death, no action or proceeding shall  be  prosecuted  or  main-
     5  tained  against  the  authority for personal injury or damage to real or
     6  personal property alleged to have been sustained by reason of the negli-
     7  gence or wrongful act of the authority or any member, officer, agent  or
     8  employee thereof, unless:
     9    (a) a notice of claim shall have been made and served upon the author-
    10  ity  within  the time limit by and in compliance with section fifty-e of
    11  the general municipal law;
    12    (b) it shall appear by and as an allegation in the complaint or moving
    13  papers that at least thirty days have elapsed since the service of  such
    14  notice  and  that  adjustment  or  payment thereof has been neglected or
    15  refused;
    16    (c) the action or proceeding shall be commenced within  one  year  and
    17  ninety  days  after  the  happening of the event upon which the claim is
    18  based; and
    19    (d) An action against  the  authority  for  wrongful  death  shall  be
    20  commenced  in  accordance  with  the notice of claim and time limitation
    21  provisions of title eleven of article nine of this chapter.
    22    2. Wherever a notice of claim is served upon the authority,  it  shall
    23  have  the right to demand an examination of the claimant relative to the
    24  occurrence and extent of the injuries or  damages  for  which  claim  is
    25  made, in accordance with the provisions of section fifty-h of the gener-
    26  al municipal law.
    27    3.  The  authority may require any person presenting for settlement an
    28  account or claim for any cause whatsoever against the  authority  to  be
    29  sworn  before  a  member,  counsel,  or an attorney, officer or employee
    30  thereof designated for such purpose, concerning such  account  or  claim
    31  and  when  so  sworn,  to answer orally as to any facts relative to such
    32  account or claim. The authority shall have power to settle or adjust all
    33  claims in favor of or against the authority.
    34    4. The rate of interest to be paid by the authority or the water board
    35  upon any judgment for which it is liable, other than a judgment  against
    36  the  authority  on  its  bonds, shall not exceed the rate of interest on
    37  judgments and accrued claims against municipal corporations as  provided
    38  in the general municipal law from time to time.  Interest on payments of
    39  principal  or  interest on any bonds in default shall accrue at the rate
    40  borne by such bonds from the due date thereof until  paid  or  otherwise
    41  satisfied.
    42    §  1114-o.  Conflicts of interest of members of the board of directors
    43  and officers and employees of the authority. No member of the  board  of
    44  directors  or officer or employee of the authority shall have any inter-
    45  est in any contract, or take any action or otherwise involve himself  or
    46  herself  in  any  activity  which,  pursuant  to article eighteen of the
    47  general municipal law, would be deemed a  conflict  of  interest  for  a
    48  municipal  officer  or  employee  holding a position with a municipality
    49  similar to the position held by the member, officer or employee with the
    50  authority.
    51    § 1114-p. Construction and purchase contracts. The authority shall let
    52  contracts for construction or purchase of supplies, materials, or equip-
    53  ment pursuant to section one hundred three of the general municipal law.
    54  Nothing in this section shall be construed to limit  the  power  of  the
    55  authority  to  do  any construction directly by the officers, agents and
    56  employees of the authority or to contract with a public utility,  for  a

        S. 6491--B                         20

     1  term  not  to  exceed five years, for the operation and maintenance of a
     2  water supply system acquired from said public utility.
     3    §  1114-q. Separability clause. If any section, clause or provision in
     4  this title shall be held by a competent court to be unconstitutional  or
     5  ineffective  in whole or in part, to the extent that it is not unconsti-
     6  tutional or ineffective, it shall be valid and effective, and  no  other
     7  section,  clause or provision shall on account thereof be deemed invalid
     8  or ineffective.
     9    § 1114-r. Effect of inconsistent provisions. Insofar as the provisions
    10  of this title are inconsistent with the provisions  of  any  other  law,
    11  general,  special  or local, or of any charter or any local ordinance or
    12  resolution of any municipality, the provisions of this  title  shall  be
    13  controlling,  provided  that  nothing contained in this section shall be
    14  held to supplement or otherwise expand  the  powers  or  duties  of  the
    15  authority  otherwise  set forth in this title. Nothing contained in this
    16  title shall be held to alter or abridge the powers  and  duties  of  the
    17  department of environmental conservation or the department of health.
    18    § 1114-s. Acquisition by eminent domain. Notwithstanding any provision
    19  of  the  eminent domain procedure law to the contrary, in any proceeding
    20  brought by the authority pursuant to said law, title shall vest  in  the
    21  authority and compensation shall be paid only:
    22    1.  upon  a  decision  by  the supreme court that compensation for the
    23  property so condemned shall be determined solely by the income  capital-
    24  ization  method  of valuation, based on the actual net income as allowed
    25  by the public service commission, and
    26    2. upon such court's determination of the amount of such compensation,
    27  based upon the income capitalization method, entry of  the  final  judg-
    28  ment,  the  filing of the final decree, and the conclusion of any appeal
    29  or expiration of the time to file an appeal related to the  condemnation
    30  proceeding.  Should  any  court  determine that a method of compensation
    31  other than the income capitalization  method  be  utilized,  or  if  the
    32  proposed award is more than the rate base of the assets taken in condem-
    33  nation as utilized by the public service commission in setting rates and
    34  as  certified  by the public service commission, the authority may with-
    35  draw the condemnation proceeding  without  prejudice  or  costs  to  any
    36  party.
    37    §  3.  This  act shall take effect on the ninetieth day after it shall
    38  have become a law.
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