N.Y. Transp. Corp. Law § 119 Guaranties

• Library: New York Statutes
• Edition: 2023
• Currency: Current through 2023 NY Law Chapter 777
• Year: 2023
• Citation: N.Y. Transp. Corp. Law § 119

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.