Opinion 2006 - 2


This opinion represents the views of the Office of the State Comptroller at the time it was rendered. The opinion may no longer represent those views if, among other things, there have been subsequent court cases or statutory amendments that bear on the issues discussed in the opinion.

IMPROVEMENT DISTRICTS -- Procedural Requirements (procedures when increase in maximum amount to be expended is funded by private contribution)
WATER DISTRICTS -- Establishment (procedures when increase in maximum amount to be expended is funded by private contribution)

TOWN LAW §§202-d, 209-h: A town must follow the procedures set forth in Town Law §§202-d or 209-h in order to increase the maximum amount to be expended for establishment of a water district, even though the increased amount will be funded by a private contribution to the town

You ask whether a town must follow the procedures set forth in Town Law §§202-d or 209-h in order to increase the maximum amount to be expended for the establishment of a water district, if the increased amount will be funded by private contributions to the town.

Towns are authorized to establish and extend water districts upon petition of a prescribed number of owners of taxable real property within the proposed district or extension pursuant to the procedures in article 12 of the Town Law (§190 et seq.), or upon town board motion subject to permissive referendum requirements pursuant to the procedures in article 12-A of the Town Law (§209-a, et seq.). Under both articles 12 and 12-A, a public hearing is required and, in certain instances, the approval of the State Comptroller is required (Town Law §§193, 194, 209-d, 209-f). In the case of an article 12 district, the proposed maximum amount of the water improvement to be constructed for the district must be stated in both the petition and notice of hearing (Town Law §§191, 193[1]). Under article 12-A, the proposed maximum amount of the improvement must be set forth in the notice of hearing (Town Law § 209-d[1]). Since there is nothing in articles 12 or 12-A that limits the statements of maximum amount to any particular funding source, it is our opinion that the entire maximum amount of improvement must be stated, irrespective of the source of funding.

Both articles 12 and 12-A also set forth procedures for increasing the maximum amount to be expended for the original improvement in a water district or extension (Town Law §§202‑d, 209-h; compare Town Law §§196, 202-b). Under article 12, Town Law §202-d provides that, at any time after the establishment of a district, the maximum amount to be expended for the improvement in the district, as stated in the petition for the establishment of the district, may be increased. A proceeding under that section for an increase must be initiated by petition and is subject to a public hearing (Town Law §202-d[1]). Under Town Law §209-h(1) in article 12-A, after the establishment of a district, the maximum amount proposed to be expended for the improvement in the district, as stated in the notice of hearing on the establishment of the district, may be increased by order of the town board after a public hearing. The order of the board under section 209-h is subject to permissive referendum requirements (Town Law §209-h[1]). Under both articles 12 and 12-A, the approval of the State Comptroller is required in certain instances (Town Law §§202-d[1], 209-h[1]).1

As with the provisions discussed above concerning the initial amount of the improvement, there is nothing in sections 202-d or 209-h that makes the applicability of the procedures prescribed by those sections dependent on the particular source of funding of the increased amount. Therefore, we have expressed the opinion that the procedures under sections 202-d and 209-h must be complied with if the maximum amount of the original improvement is increased, irrespective of the source of funding for the increase (28 Opns St Comp, 1972, p 99, federal and State aid as the source of funding; 3 Opns St Comp, 1947, p 521, contributions of individuals as the source of funding).

Accordingly, a town must follow the procedures set forth in Town Law §§202-d or 209-h in order to increase the maximum amount to be expended for establishment of a water district, even though the increased amount will be funded by a private contribution to the town.2

January 26, 2006

David J. Wukitsch, Esq., Town Attorney
Town of New Baltimore

 

1 The State Comptroller’s approval is required for an increase in the maximum amount to be expended for the original improvement of a town water district if the town proposes to issue indebtedness to finance all or part of the improvement and the cost of the district, including the increased amount, to the “typical property” or, if different, the “typical one or two family home” (see Town Law §§193[2], 209-a), as stated in the notice of hearing on the increase, is above the average estimated cost thresholds as may be annually computed by the State Comptroller (Town Law §§194[6], 202-d[1], 209-f[1], 209-h[1]). The State Comptroller provides annual notice to towns of the average cost thresholds (Town Law §§194[6], 209-f[1]). The State Comptroller’s approval may be granted only after the public hearing on the increase and, in the case of an increase pursuant to section 209-h, after the permissive referendum requirements are met (Town Law §§202-d[1], 209-h[1]).

2 Note that, in general, nothing would preclude the town from indicating, in the notice of hearing, that the source of funding for the increased amount will be a private contribution. The town should be certain, however, that there is firm commitment for the contribution.