S T A T E O F N E W Y O R K
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5877--A
2025-2026 Regular Sessions
I N A S S E M B L Y
February 24, 2025
___________
Introduced by M. of A. BRABENEC -- read once and referred to the Commit-
tee on Local Governments -- committee discharged, bill amended,
ordered reprinted as amended and recommitted to said committee
AN ACT to ratify and confirm the creation of water district no. 14 of
the town of Monroe and to authorize the issuance of bonds or notes by
the town of Monroe to finance certain inter-fund borrowings by water
district no. 14 from such town's general fund
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Legislative findings. It is hereby found and determined
that the Town of Monroe, Orange County, New York, hereinafter known as
the town, spent General Fund money in the amount of $577,539 to make
improvements to the former water system owned and operated by Orchard
Hill Water Company prior to the establishment of Water District No. 14
in accordance with the provisions of Article 12-A of the town law. In
2013, the town spent general fund money in the amount of $144,523 to pay
for the construction of a new water well, improvements to the pump house
and other system improvements. In the years that followed, the town
spent general fund money in the amount of $433,016 to replace water
mains and make other system improvements, including tank rehabilitation.
The expenditure of such funds by the town board prior to the district's
establishment as described above was in violation of the provisions of
section 165.10 of the local finance law. Further, the town failed to
repay to the moneys advanced from the general fund to make improvements
to the former water system by the close of the fiscal year in which the
advance was made with reasonable interest in accordance with section 9-a
of the general municipal law.
Lastly, bond resolutions were not adopted by the town board at the
times such funds were paid and as a result the town is prohibited from
financing such costs with bonds or notes. The specific actions taken by
the town in furtherance of establishment of Water District No. 14 and
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD07597-03-5
A. 5877--A 2
the construction and financing of improvements therein are more fully
described as follows:
Upon the death of the owners of the Orchard Hill Water Company, the
water system fell into disrepair leading to the enactment of a Boil
Water Notice on May 10, 2011 for the residents of the water system. The
land of the Orchard Hill Water Company fell into receivership. Residents
of the water system petitioned the town to assume operation of the water
system and to form a water district. The town board adopted an Order
Calling a Public Hearing and held said Public Hearing on December 17,
2012. The town's petition to be named as a temporary operator of the
system was approved by the Public Service Commission on June 17, 2013.
The town submitted an application to the state comptroller for the
approval of the establishment of Water District No. 14 and the
construction of improvements required by the Department of Health to
operate the system. Various discussions between representatives of the
state comptroller and the town followed regarding the application
submitted by the town. The town decided to amend the scope of the
improvements to be undertaken to reduce the impact to the residents
served by the former Orchard Hill Water Company resulting in
construction of a new water well, improvements to the pump house and
other system improvements. The land owned by the Orchard Hill Water
Company remained in receivership following the death of the owners and
the town withdrew its application submitted to the state comptroller
because the town did not own the property. The town ultimately took
ownership of the land in 2019.
In 2019, the town's engineer prepared a map, plan and report for Water
District No. 14. On July 1, 2019, the town board held a public hearing
with respect to Water District No. 14 and adopted an Order Following
Public Hearing. The town filed said order with the county clerk; howev-
er, the town board did not obtain the permission of the state comp-
troller for the establishment of the district in violation of section
209-f of the town law.
The town has operated Water District No. 14 as a de-facto water
district in violation of the provisions of articles 12 and 12-A of the
town law since 2013. In addition to using general fund money to pay the
costs of the initial improvements described herein, the town has spent
general fund money to replace water mains on account of breaks and other
system improvements, including tank rehabilitation, to provide for a
properly functioning water system. The town has been assessing resi-
dents of Water District No. 14 for operation and maintenance expenses of
the water system in accordance with the schedule enacted by the public
service commission. The town has not assessed residents for capital
improvements to the system and as result none of the general fund money
paid by the town has been repaid. As of December 31, 2024, the total
amount of the initial payment by the town that remains outstanding is
$577,539.
The failure of the town board to adopt a bond resolution prior to the
expenditure of such money for the water system improvements was contrary
to the provisions of section 165.10 of the local finance law.
§ 2. Water district established. Notwithstanding the defects
described in section 1 of this act, the establishment of Water District
No. 14 is hereby legalized, validated, ratified and confirmed. Said
water district established pursuant to this act shall be funded, oper-
ated, expanded and otherwise controlled in accordance with the
provisions of articles 12 and 12-A of the town law and the provisions of
this act. To the extent that the provisions of this act shall in any
A. 5877--A 3
way be in conflict with articles 12 and 12-A of the town law, the
provisions of this act shall be controlling. The imposition of any
special assessments by the town upon the properties previously served by
the Orchard Hill Water Company are hereby validated.
§ 3. Bonds authorized. The town is authorized to issue bonds or notes
in the principal amount of $577,539 on behalf of Water District No. 14
for the purpose of reimbursing the general fund of the town from which
moneys have been temporarily diverted since 2013 to pay certain of the
costs incurred in the improvement of the water system acquired by the
town in accordance with mandate of the public service commission,
notwithstanding the provisions of section 165.10 of the local finance
law which, provide, in effect that a bond resolution shall have first
adopted before any such temporary diversion of funds shall have been so
made and notwithstanding section 9-a of the general municipal law which
requires money advanced to be repaid to the fund from which they were
advanced not later than the close of the fiscal year in which the
advance was made with reasonable interest. The period of probable
usefulness for such improvements is forty (40) years from the date of
the initial improvements, which occurred in 2013. In anticipation of
such bonds, bond anticipation notes are hereby authorized.
§ 4. Obligations. Except as provided herein, any obligations issued
pursuant to this act shall be issued in accordance with the local
finance law.
§ 5. Severability. If any clause, sentence, subdivision, paragraph,
section, or part of this act be adjudged by any court of competent
jurisdiction to be invalid, judgment shall not affect, impair, or inval-
idate the remainder thereof, but shall be confined in its operation to
the clause, sentence, subdivision, paragraph, section, or part thereof
directly involved in the controversy in which such judgment shall have
been rendered.
§ 6. This act shall take effect immediately.