GENERAL MUNICIPAL LAW, §94: A village may use profits
resulting from operation of a water utility for general village
You ask whether a village board of trustees may use surplus moneys in the village's water fund for sewer or other general village purposes.
General Municipal Law, §94 provides that "profits" resulting from a municipal gas, electric or water utility service may be used "for the payment of expenses or obligations incurred by such municipal corporation for municipal purposes or for the payment of refunds to consumers" (see also NY Const, art 14, §1[f]). In our opinion, the reference to "profits" in section 94 means that operating revenues in the water fund must exceed expenditures before surplus water fund moneys may be transferred from the water fund pursuant to that statute and used for any lawful village purpose (see 1968 Opns St Comp No. 68-829, unreported; 7 Opns St Comp, 1951, p 262; 4 Opns St Comp, 1948, p 258, 280).
A transfer of profits from the water fund may be made either during the fiscal year as a supplemental appropriation (Village Law, §5-520), or by an appropriation as a part of the annual budget process (Village Law, §5-506[b]). Pursuant to Village Law, §5-520(4), however, for purposes of supplemental appropriations made during a fiscal year, surplus is available for transfer only to the extent that the total of all revenues of the water fund, including cash surplus, exceeds the total of all revenues of the fund as estimated in the budget, including appropriated cash surplus (Opn No. 68-829, supra).
July 16, 1991