S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   1204
 
                        2021-2022 Regular Sessions
 
                           I N  A S S E M B L Y
 
                              January 7, 2021
                                ___________
 
 Introduced  by  M. of A. LAVINE, MONTESANO, RA -- read once and referred
   to the Committee on Corporations, Authorities and Commissions
 
 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:
 
   Section 1. Legislative findings. The legislature hereby finds that the
 groundwater supply system presently operated by a private utility in the
 northwest portion of the Nassau county servicing the  residents  of  the
 village  of  Sea  Cliff,  and portions of the village of Old Brookville,
 village of Roslyn Harbor, and residents in the unincorporated hamlets of
 Glenwood Landing, Glen Head and the city of Glen Cove,  is  fragile  and
 subject  to episodic deficiencies of varying magnitude including service
 disruptions and drastic price variations to residents  serviced  by  the
 existing  private  water company. The groundwater supply requires better
 management of its entire reserve both within and outside the water util-
 ity supply area as well as long range planning to provide protection  of
 important  watershed  areas,  water  conservation,  and  prevention from
 contamination and salt water intrusion. Since the potable water for  the
 northern portion of the North Shore peninsula is derived from an aquifer
 which  is the sole source of water for all of Long Island, the issues of
 contamination and conservation are of statewide concern. The problems of
 salt water intrusion facing the North Shore peninsula, face  many  other
 peninsulas  on  Long Island and many of the barrier islands. It is hoped
 that the authority created by this act will not only  protect,  preserve
 and  enhance  the  quality  and  quantity of the water within its supply
 area, but that it will also serve as a model and as a leader in  foster-
 ing  cooperation  with  other water suppliers to better manage, conserve
 and protect the groundwater within and outside its supply area.
   § 2. Article 5 of the public authorities law is amended  by  adding  a
 new title 5-a to read as follows:
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD03780-01-1

 A. 1204                             2
 
                                 TITLE 5-A
                        NORTH SHORE WATER AUTHORITY
 SECTION 1114-A. SHORT TITLE.
         1114-B. DEFINITIONS.
         1114-C. WATER AUTHORITY OF NORTH SHORE DISTRICT.
         1114-D. WATER AUTHORITY OF NORTH SHORE.
         1114-E. POWERS OF THE AUTHORITY.
         1114-F. TRANSFER OF OFFICERS AND EMPLOYEES.
         1114-G. BONDS OF THE AUTHORITY.
         1114-H. REMEDIES OF BONDHOLDERS.
         1114-I. STATE AND MUNICIPALITIES NOT LIABLE ON AUTHORITY BONDS.
         1114-J. MONEYS OF THE AUTHORITY.
         1114-K. BONDS; LEGAL INVESTMENTS FOR FIDUCIARIES.
         1114-L. AGREEMENT WITH THE STATE.
         1114-M. EXEMPTION  FROM  TAXES,  ASSESSMENTS  AND  CERTAIN FEES;
                   PAYMENTS IN LIEU OF TAXES.
         1114-N. ACTIONS AGAINST THE AUTHORITY.
         1114-O. CONFLICTS OF INTEREST OF MEMBERS OF THE BOARD OF  DIREC-
                   TORS AND OFFICERS AND EMPLOYEES OF THE AUTHORITY.
         1114-P. CONSTRUCTION AND PURCHASE CONTRACTS.
         1114-Q. SEPARABILITY CLAUSE.
         1114-R. EFFECT OF INCONSISTENT PROVISIONS.
         1114-S. ACQUISITION BY EMINENT DOMAIN.
   § 1114-A. SHORT TITLE. THIS TITLE MAY BE CITED AS THE "WATER AUTHORITY
 OF NORTH SHORE ACT".
   §  1114-B. DEFINITIONS. AS USED OR REFERRED TO IN THIS TITLE, UNLESS A
 DIFFERENT MEANING CLEARLY APPEARS FROM THE CONTEXT:
   1. "AUTHORITY" SHALL MEAN THE CORPORATION CREATED  BY  SECTION  ELEVEN
 HUNDRED FOURTEEN-D OF THIS TITLE.
   2. "BOARD OF DIRECTORS" SHALL MEAN THE GOVERNING BOARD OF THE AUTHORI-
 TY.
   3.  "BONDS"  SHALL MEAN THE BONDS, NOTES OR OTHER EVIDENCES OF INDEBT-
 EDNESS ISSUED BY THE AUTHORITY PURSUANT TO THIS TITLE.
   4. "CALENDAR YEAR" SHALL MEAN THE TWELVE  MONTH  PERIOD  FROM  JANUARY
 FIRST THROUGH DECEMBER THIRTY-FIRST.
   5.  "CHIEF  EXECUTIVE  OFFICER" WHEN REFERRING TO A MUNICIPALITY SHALL
 MEAN THE CHIEF ELECTED OFFICIAL OF SUCH MUNICIPALITY AND, WHEN REFERRING
 TO THE AUTHORITY, SHALL MEAN THE CHAIRPERSON OF THE AUTHORITY.
   6. "CIVIL SERVICE COMMISSION" SHALL MEAN THE CIVIL SERVICE  COMMISSION
 OF THE COUNTY OF NASSAU.
   7. "COMPTROLLER" SHALL MEAN THE COMPTROLLER OF THE STATE OF NEW YORK.
   8.  "CONSTRUCTION"  SHALL MEAN THE NEGOTIATION, ACQUISITION, ERECTION,
 BUILDING,  ALTERATION,  IMPROVEMENT,  TESTING,  INCREASE,   ENLARGEMENT,
 EXTENSION, RECONSTRUCTION, INTERCONNECTION, RENOVATION OR REHABILITATION
 OF  A  WATER  FACILITY  AS  DEFINED  IN THIS SECTION; THE INSPECTION AND
 SUPERVISION  THEREOF;  AND  THE   ENGINEERING,   ARCHITECTURAL,   LEGAL,
 APPRAISAL,  FISCAL,  ECONOMIC AND ENVIRONMENTAL INVESTIGATIONS, SERVICES
 AND STUDIES, SURVEYS, DESIGNS, PLANS, WORKING DRAWINGS,  SPECIFICATIONS,
 PROCEDURES AND OTHER ACTIONS INCIDENTAL THERETO.
   9.  "COSTS",  AS  APPLIED  TO  ANY  PROJECT, SHALL INCLUDE THE COST OF
 CONSTRUCTION, THE COST OF THE ACQUISITION  OF  ALL  PROPERTY,  INCLUDING
 BOTH  REAL,  PERSONAL  AND  MIXED,  THE COST OF DEMOLISHING, REMOVING OR
 RELOCATING ANY BUILDINGS OR STRUCTURES ON LANDS  SO  ACQUIRED  INCLUDING
 THE COST OF ACQUIRING ANY LAND TO WHICH SUCH BUILDINGS OR STRUCTURES MAY
 BE  MOVED  OR RELOCATED, THE COST OF ALL SYSTEMS, FACILITIES, MACHINERY,
 APPARATUS AND EQUIPMENT, FINANCING CHARGES AND BOND  DISCOUNT,  INTEREST

 A. 1204                             3
 
 TO  THE  EXTENT NOT PAID OR PROVIDED FOR FROM REVENUES OR OTHER SOURCES,
 THE COST OF ENGINEERING AND ARCHITECTURAL SURVEYS, PLANS AND  SPECIFICA-
 TIONS,  BOND  INSURANCE,  BOND  CREDIT  ENHANCEMENT  ARRANGEMENTS, OTHER
 EXPENSES NECESSARY OR INCIDENTAL TO THE CONSTRUCTION OF SUCH PROJECT AND
 THE  FINANCING  OF THE CONSTRUCTION THEREOF, INCLUDING THE COST OF LEGAL
 AND FINANCIAL ADVICES AND CREDIT ARRANGEMENTS WITH BANKS OR OTHER FINAN-
 CIAL INSTITUTIONS, THE  AMOUNT  AUTHORIZED  IN  THE  RESOLUTION  OF  THE
 AUTHORITY  PROVIDING  FOR  THE  ISSUANCE  OF  BONDS  TO BE PAID INTO ANY
 RESERVE OR SPECIAL FUND FROM THE PROCEEDS OF SUCH BONDS AND THE  FINANC-
 ING OF THE PLACING OF ANY PROJECT IN OPERATION, INCLUDING THE REIMBURSE-
 MENT  TO  ANY  MUNICIPALITY,  STATE AGENCY, THE STATE, THE UNITED STATES
 GOVERNMENT, OR ANY OTHER PERSON FOR EXPENDITURES MADE BY THEM THAT WOULD
 BE COSTS OF THE PROJECT HEREUNDER, NOTWITHSTANDING THE  FACT  THAT  SUCH
 EXPENDITURES  MAY HAVE BEEN INCURRED PRIOR TO THE EFFECTIVE DATE OF THIS
 TITLE.
   10. "COUNTY" SHALL MEAN THE COUNTY OF NASSAU.
   11. "DISTRIBUTION SYSTEM" SHALL MEAN THE WATER FACILITY OR  FACILITIES
 EMPLOYED  TO  DELIVER WATER FROM A TRANSMISSION FACILITY, OR WHERE THERE
 IS NO TRANSMISSION FACILITY, FROM A SUPPLY  FACILITY,  TO  THE  ULTIMATE
 CONSUMERS OF WATER.
   12.  "DISTRICT"  SHALL  MEAN  THE WATER AUTHORITY OF NORTH SHORE WATER
 DISTRICT CREATED BY SECTION ELEVEN HUNDRED FOURTEEN-C OF THIS TITLE.
   13. "GOVERNING BODY" SHALL MEAN:
   (A) IN THE CASE OF A CITY, COUNTY, TOWN OR VILLAGE OR DISTRICT  CORPO-
 RATION,  THE  FINANCE BOARD AS SUCH TERM IS DEFINED IN THE LOCAL FINANCE
 LAW; OR
   (B) IN THE CASE OF A PUBLIC BENEFIT CORPORATION, THE MEMBERS THEREOF.
   14. "MEMBERS" SHALL MEAN THE MEMBERS OF THE BOARD OF DIRECTORS.
   15. "MUNICIPALITY" SHALL MEAN ANY CITY, COUNTY, TOWN, VILLAGE OR COUN-
 TY OR TOWN ACTING ON BEHALF OF AN IMPROVEMENT DISTRICT.
   16."REAL PROPERTY" SHALL MEAN LANDS, STRUCTURES, FRANCHISES AND INTER-
 ESTS IN LAND, WATERS, LANDS UNDER WATER, GROUNDWATER RIPARIAN RIGHTS AND
 AIR RIGHTS AND ANY AND ALL THINGS AND RIGHTS CUSTOMARILY INCLUDED WITHIN
 THE TERM "REAL PROPERTY" AND INCLUDES NOT ONLY FEE SIMPLE ABSOLUTE,  BUT
 ALSO  ANY  AND ALL LESSER INTERESTS INCLUDING, BUT NOT LIMITED TO, EASE-
 MENTS, RIGHTS OF WAY, USES, LEASES, LICENSES AND ALL  OTHER  INCORPOREAL
 HEREDITAMENTS  AND  EVERY ESTATE, INTEREST OR RIGHT, LEGAL OR EQUITABLE,
 INCLUDING TERMS FOR YEARS AND LIENS THEREON BY WAY OF  JUDGMENTS,  MORT-
 GAGES OR OTHERWISE.
   17.  "STATE  SANITARY CODE" SHALL MEAN REGULATIONS ADOPTED PURSUANT TO
 SECTION TWO HUNDRED TWENTY-FIVE OF THE PUBLIC HEALTH LAW.
   18. "STATE" SHALL MEAN STATE OF NEW YORK.
   19. "STATE AGENCY" SHALL MEAN ANY STATE OFFICE, PUBLIC BENEFIT  CORPO-
 RATION,  DEPARTMENT,  BOARD,  COMMISSION,  BUREAU  OR DIVISION, OR OTHER
 AGENCY OR INSTRUMENTALITY OF THE STATE.
   20. "SUPPLY FACILITY" SHALL MEAN A WATER  FACILITY  EMPLOYED  TO  MAKE
 GROUNDWATER  OR SURFACE WATER AVAILABLE FOR DELIVERY INTO A TRANSMISSION
 FACILITY OR DISTRIBUTION SYSTEM.
   21. "SYSTEM REVENUES" SHALL MEAN  ALL  RATES,  RENTS,  FEES,  CHARGES,
 PAYMENTS AND OTHER INCOME AND RECEIPTS DERIVED FROM USERS OF THE AUTHOR-
 ITY  WITHOUT  LIMITING  THE  GENERALITY  OF  THE  FOREGOING,  INVESTMENT
 PROCEEDS AND PROCEEDS OF INSURANCE, CONDEMNATION, SALES OR OTHER  DISPO-
 SITIONS  OF ASSETS, TOGETHER WITH ALL FEDERAL, STATE OR MUNICIPAL AID AS
 WELL AS ANY OTHER INCOME DERIVED FROM THE OPERATION OF THE WATER FACILI-
 TY OF THE AUTHORITY.

 A. 1204                             4
 
   22. "TRANSMISSION FACILITY" SHALL MEAN A WATER FACILITY USED TO  CARRY
 WATER FROM A SUPPLY FACILITY TO A DISTRIBUTION SYSTEM.
   23. "TREASURER" SHALL MEAN THE TREASURER OF THE AUTHORITY.
   24.  "WATER  FACILITY"  OR  "WATER  FACILITIES" SHALL MEAN ANY PLANTS,
 STRUCTURES AND OTHER REAL AND PERSONAL PROPERTY ACQUIRED,  REHABILITATED
 OR  CONSTRUCTED FOR THE PURPOSE OF SUPPLYING, TRANSMITTING, DISTRIBUTING
 OR TREATING WATER, INCLUDING BUT NOT LIMITED TO SURFACE  OR  GROUNDWATER
 RESERVOIRS, BASINS, DAMS, CANALS, AQUEDUCTS, STANDPIPES, CONDUITS, PIPE-
 LINES, MAINS, PUMPING STATIONS, WATER DISTRIBUTION SYSTEMS, COMPENSATING
 RESERVOIRS,  INTAKE  STATIONS,  WATERWORKS  OR  SOURCES OF WATER SUPPLY,
 WELLS, PURIFICATION OR FILTRATION PLANTS OR OTHER TREATMENT  PLANTS  AND
 WORKS,  CONNECTIONS,  WATER  METERS,  RIGHTS OF FLOWAGE OR DIVERSION AND
 OTHER  PLANTS,  STRUCTURES,  EQUIPMENT,  TOWERS,  CONVEYANCES,  REAL  OR
 PERSONAL  PROPERTY OR RIGHTS THEREIN AND APPURTENANCES THERETO NECESSARY
 OR USEFUL AND CONVENIENT FOR  THE  ACCUMULATION,  SUPPLY,  TRANSMISSION,
 TREATMENT OR DISTRIBUTION OF WATER.
   25. "WATER PROJECT" SHALL MEAN ANY WATER FACILITY, INCLUDING THE PLAN-
 NING, DEVELOPMENT, FINANCING OR CONSTRUCTION THEREOF.
   26. "WATERSHED RULES" SHALL MEAN THE RULES AND REGULATIONS MADE BY THE
 DEPARTMENT  OF  HEALTH  PURSUANT TO SECTION ELEVEN HUNDRED OF THE PUBLIC
 HEALTH LAW.
   § 1114-C. WATER AUTHORITY OF NORTH SHORE  DISTRICT.  THERE  IS  HEREBY
 CREATED  A  DISTRICT  TO BE KNOWN AS THE "WATER AUTHORITY OF NORTH SHORE
 DISTRICT" WHICH SHALL BE DEFINED AS ALL THAT PORTION  OF  NASSAU  COUNTY
 BEING SERVICED BY THE NEW YORK AMERICAN WATER SERVICE CORPORATION AS ITS
 SEA CLIFF OPERATIONS DISTRICT AS OF JANUARY FIRST, TWO THOUSAND EIGHTEEN
 AND LYING NORTH OF THE AREA SERVICED BY JERICHO WATER DISTRICT.
   §  1114-D.  WATER  AUTHORITY OF NORTH SHORE. 1. A CORPORATION KNOWN AS
 "WATER AUTHORITY OF NORTH SHORE" IS HEREBY CREATED FOR THE PURPOSES  AND
 CHARGED  WITH  THE  DUTIES AND HAVING THE POWERS PROVIDED IN THIS TITLE.
 THE AUTHORITY SHALL BE A CORPORATE GOVERNMENTAL  AGENCY  CONSTITUTING  A
 PUBLIC  BENEFIT  CORPORATION  AND  SHALL  BE A "PUBLIC DISTRICT" FOR THE
 PURPOSES OF SECTION EIGHTY-NINE OF THE PUBLIC SERVICE LAW. THE AUTHORITY
 SHALL BE GOVERNED BY A BOARD OF DIRECTORS CONSISTING OF SIX MEMBERS. THE
 GOVERNING BOARDS OF THE VILLAGES OF OLD BROOKVILLE,  SEA  CLIFF,  ROSLYN
 HARBOR,  AND  THE  CITY  OF GLEN COVE SHALL EACH APPOINT ONE MEMBER. THE
 GOVERNING BOARD OF THE TOWN OF OYSTER  BAY  SHALL  APPOINT  TWO  MEMBERS
 REPRESENTING  THE  RESIDENTS  OF THE UNINCORPORATED HAMLETS OF GLEN HEAD
 AND GLENWOOD LANDING WHO ARE SERVICED BY THE WATER  AUTHORITY  OF  NORTH
 SHORE.  EACH  MEMBER  SHALL  SERVE FOR A PERIOD OF TWO YEARS. EACH CHIEF
 EXECUTIVE OFFICER SHALL FILE WITH THE SECRETARY OF STATE  A  CERTIFICATE
 OF  APPOINTMENT  OR REAPPOINTMENT OF ANY MEMBER APPOINTED OR REAPPOINTED
 BY SUCH CHIEF EXECUTIVE WITHIN THIRTY DAYS OF THE APPOINTMENT  OR  REAP-
 POINTMENT.  MEMBERS SHALL RECEIVE NO COMPENSATION FOR THEIR SERVICES BUT
 SHALL BE ENTITLED TO REIMBURSEMENT OF THEIR NECESSARY EXPENSES,  INCLUD-
 ING TRAVELING EXPENSES, INCURRED IN THE DISCHARGE OF THEIR DUTIES. NOTH-
 ING  IN  THIS SECTION SHALL BE CONSTRUED AS PREVENTING A CHIEF EXECUTIVE
 OFFICER OF A MUNICIPALITY FROM APPOINTING HIMSELF OR  HERSELF  TO  BE  A
 MEMBER OF THE BOARD OF DIRECTORS.
   2.  IF  THE  AUTHORITY DECIDES TO ENTER INTO A CONTRACT TO PURCHASE OR
 OTHERWISE ACQUIRE AN INTEREST IN THE NEW  YORK  AMERICAN  WATER  SERVICE
 CORPORATION  OR  TO  INITIATE  A CONDEMNATION PROCEEDING PURSUANT TO THE
 EMINENT DOMAIN PROCEDURE LAW FOR THE AREA IT SERVICES WITHIN  THE  WATER
 AUTHORITY  OF  NORTH SHORE DISTRICT, PRIOR TO ENTERING INTO ANY CONTRACT
 TO PURCHASE OR OTHERWISE ACQUIRE AN INTEREST IN THE  NEW  YORK  AMERICAN
 WATER SERVICE CORPORATION OR THE INITIATION OF ANY CONDEMNATION PROCEED-

 A. 1204                             5
 
 ING  BY  THE  AUTHORITY PURSUANT TO THE EMINENT DOMAIN PROCEDURE LAW FOR
 THE AREA IT SERVICES WITHIN THE WATER AUTHORITY OF NORTH SHORE DISTRICT,
 THE AUTHORITY SHALL PROVIDE RATEPAYERS WITHIN THE AREA SERVICED  BY  THE
 NEW  YORK  AMERICAN WATER SERVICE CORPORATION AND THE PUBLIC WITH PUBLIC
 FORUMS FOR  THE  EXPRESSION  AND  DISCUSSION  OF  VIEWS  REGARDING  SUCH
 PURCHASE,  ACQUISITION  OR  CONDEMNATION  OF THE NEW YORK AMERICAN WATER
 SERVICE CORPORATION. THE AUTHORITY SHALL HOLD AT LEAST ONE FORUM IN EACH
 OF THE TOWNS OF NORTH HEMPSTEAD, OYSTER BAY, AND CITY OF GLEN COVE WITH-
 IN THE PORTIONS OF THE TOWNS OF NORTH HEMPSTEAD AND OYSTER BAY  AND  THE
 CITY OF GLEN COVE SERVICED BY THE NEW YORK AMERICAN WATER SERVICE CORPO-
 RATION.
   3.  IF  THE  AUTHORITY DECIDES TO ENTER INTO A CONTRACT TO PURCHASE OR
 OTHERWISE ACQUIRE AN INTEREST IN THE NEW  YORK  AMERICAN  WATER  SERVICE
 CORPORATION  OR  TO  INITIATE  A CONDEMNATION PROCEEDING PURSUANT TO THE
 EMINENT DOMAIN PROCEDURE LAW FOR THE AREA IT SERVICES WITHIN  THE  WATER
 AUTHORITY  OF  NORTH  SHORE  DISTRICT,  THE  AUTHORITY  IS AUTHORIZED TO
 PROVIDE REGISTERED VOTERS WITHIN THE AREA SERVICED BY THE NEW YORK AMER-
 ICAN WATER SERVICE CORPORATION WITHIN THE WATER AUTHORITY OF NORTH SHORE
 DISTRICT PRIOR TO ENTERING INTO SUCH CONTRACT TO PURCHASE  OR  OTHERWISE
 ACQUIRE  AN  INTEREST IN THE NEW YORK AMERICAN WATER SERVICE CORPORATION
 OR THE INITIATION OF ANY CONDEMNATION PROCEEDING BY THE AUTHORITY PURSU-
 ANT TO THE EMINENT DOMAIN PROCEDURE LAW FOR THE AREA THE NEW YORK AMERI-
 CAN WATER SERVICE CORPORATION SERVICES WITHIN  THE  WATER  AUTHORITY  OF
 NORTH  SHORE  DISTRICT,  WITH A NONBINDING REFERENDUM, REGARDING WHETHER
 THE AUTHORITY SHOULD ENTER INTO A  CONTRACT  TO  PURCHASE  OR  OTHERWISE
 ACQUIRE  AN  INTEREST IN THE NEW YORK AMERICAN WATER SERVICE CORPORATION
 OR INITIATE CONDEMNATION PROCEEDINGS  PURSUANT  TO  THE  EMINENT  DOMAIN
 PROCEDURE  LAW  FOR  THE  AREA IT SERVICES WITHIN THE WATER AUTHORITY OF
 NORTH SHORE DISTRICT. THE PROPOSITION SHALL BE PLACED ON THE BALLOT  AND
 VOTED  UPON  AT  A  SPECIAL  ELECTION  OR A DATE TO BE DETERMINED BY THE
 NASSAU COUNTY BOARD OF ELECTIONS.
   4. ANY ONE OR MORE OF THE MEMBERS OF THE BOARD OF DIRECTORS MAY BE  AN
 OFFICIAL  OR AN EMPLOYEE OF A MUNICIPALITY SITUATED WITHIN THE DISTRICT.
 IN THE EVENT THAT AN OFFICIAL OR AN EMPLOYEE OF SUCH MUNICIPALITY  SHALL
 BE  ELECTED  AS  A  MEMBER  OF  THE  BOARD  OF  DIRECTORS, ACCEPTANCE OR
 RETENTION OF SUCH APPOINTMENT SHALL NOT BE DEEMED A FORFEITURE OF HIS OR
 HER MUNICIPAL OFFICE OR EMPLOYMENT, OR INCOMPATIBLE THEREWITH OR  AFFECT
 HIS OR HER TENURE OR COMPENSATION IN ANY WAY.
   5.  NO  ACTION  SHALL BE TAKEN BY THE AUTHORITY EXCEPT PURSUANT TO THE
 FAVORABLE VOTE OF FIFTY-ONE  PERCENT  OF  THE  TOTAL  AUTHORIZED  VOTING
 STRENGTH OF THE BOARD OF DIRECTORS. THE TOTAL AUTHORIZED VOTING STRENGTH
 OF THE BOARD OF DIRECTORS SHALL BE:
   (A) THE NUMBER OF WEIGHTED VOTES POSSESSED BY EACH MEMBER OF THE BOARD
 OF  DIRECTORS SHALL BE DETERMINED IN ACCORDANCE WITH PARAGRAPHS (B), (C)
 AND (D) OF THIS SUBDIVISION, EXCEPT  EACH  MEMBER  SHALL  POSSESS  EQUAL
 WEIGHTED VOTES PRIOR TO THE ADJUSTMENT PURSUANT TO PARAGRAPH (D) OF THIS
 SUBDIVISION;
   (B)  NO  ACTION SHALL BE TAKEN BY THE AUTHORITY EXCEPT PURSUANT TO THE
 FAVORABLE VOTE OF AT LEAST: (I) FIFTY-ONE PERCENT OF THE  TOTAL  AUTHOR-
 IZED  VOTING  STRENGTH OF THE BOARD OF DIRECTORS; AND (II) THREE MEMBERS
 OF THE BOARD OF DIRECTORS, AT LEAST TWO OF WHOM SHALL BE FROM AMONG  THE
 FOUR MEMBERS OF THE BOARD OF DIRECTORS POSSESSING THE GREATEST NUMBER OF
 WEIGHTED VOTES;
   (C)  THE  VOTE OF EACH MEMBER SHALL BE EQUAL TO ONE HUNDRED MULTIPLIED
 BY A FRACTION, THE NUMERATOR OF WHICH SHALL BE EQUAL TO THE QUANTITY  OF
 WATER  SUPPLIED  BY  THE AUTHORITY TO THE OWNERS, TENANTS, OCCUPANTS AND

 A. 1204                             6
 
 OTHER WATER USERS  IN  THE  MUNICIPALITY  FROM  WHICH  SUCH  MEMBER  WAS
 APPOINTED AND THE DENOMINATOR OF WHICH SHALL BE EQUAL TO THE QUANTITY OF
 WATER  SUPPLIED  BY  THE AUTHORITY TO THE OWNERS, TENANTS, OCCUPANTS AND
 OTHER WATER USERS IN ALL OF THE MUNICIPALITIES WITHIN THE DISTRICT; AND
   (D) COMMENCING ON THE FIRST DAY OF JANUARY, TWO THOUSAND TWENTY-THREE,
 AND  EVERY FOUR YEARS THEREAFTER, THE AUTHORIZED NUMBER OF VOTES OF EACH
 MEMBER SHALL BE ADJUSTED IN ACCORDANCE WITH THE  FORMULA  SET  FORTH  IN
 PARAGRAPH (C) OF THIS SUBDIVISION TO REFLECT THE TOTAL QUANTITY OF WATER
 SUPPLIED  BY THE AUTHORITY TO OWNERS, TENANTS, OCCUPANTS AND OTHER WATER
 USERS IN EACH MUNICIPALITY WITHIN THE DISTRICT DURING THE  TWO  CALENDAR
 YEARS  IMMEDIATELY  PRECEDING  THE DATE ON WHICH THE ADJUSTMENT IS BEING
 MADE.
   6. THE POWERS OF THE AUTHORITY SHALL BE VESTED IN AND SHALL  BE  EXER-
 CISED  BY THE BOARD OF DIRECTORS AT A MEETING DULY CALLED AND HELD. FOUR
 MEMBERS OF THE BOARD OF DIRECTORS, WHO TOGETHER ARE AUTHORIZED TO CAST A
 MAJORITY OF THE WEIGHTED VOTE, SHALL CONSTITUTE A QUORUM. THE  BOARD  OF
 DIRECTORS  MAY DELEGATE TO ONE OR MORE OF ITS MEMBERS, OR TO ONE OR MORE
 OF THE OFFICERS, AGENTS OR EMPLOYEES OF THE AUTHORITY, SUCH  POWERS  AND
 DUTIES AS IT MAY DEEM PROPER.
   7.  THE OFFICERS OF THE AUTHORITY SHALL CONSIST OF A CHAIRPERSON, VICE
 CHAIRPERSON, DEPUTY CHAIRPERSON, TREASURER, AND SECRETARY, WHO SHALL NOT
 BE MEMBERS OF THE BOARD OF DIRECTORS.  THE  OFFICERS  OF  THE  AUTHORITY
 SHALL BE APPOINTED BY THE BOARD OF DIRECTORS. THE BOARD OF DIRECTORS MAY
 APPOINT  AND  AT  ITS PLEASURE REMOVE AN ATTORNEY AND AN ENGINEER, WHICH
 POSITIONS, IN ADDITION TO THE OFFICERS ABOVE  NAMED,  SHALL  BE  IN  THE
 EXEMPT  CLASS  OF  THE  CIVIL  SERVICE  AND SUCH ADDITIONAL OFFICERS AND
 EMPLOYEES AS IT MAY REQUIRE FOR THE PERFORMANCE OF ITS DUTIES,  FIX  AND
 DETERMINE  THEIR  QUALIFICATIONS,  DUTIES,  COMPENSATIONS  AND  TERMS OF
 OFFICE OR TENURE, SUBJECT TO THE PROVISIONS OF THE CIVIL SERVICE LAW  OF
 THE  STATE  AND SUCH RULES AS THE CIVIL SERVICE COMMISSION MAY ADOPT AND
 MAKE APPLICABLE TO THE AUTHORITY. THE AUTHORITY MAY ALSO  FROM  TIME  TO
 TIME  CONTRACT FOR EXPERT PROFESSIONAL SERVICES. THE DUTIES OF THE OFFI-
 CERS SHALL BE AS FOLLOWS:
   (A) CHAIRPERSON. THE CHAIRPERSON SHALL BE THE CHIEF EXECUTIVE  OFFICER
 OF  THE  AUTHORITY AND IT SHALL BE THE RESPONSIBILITY OF THE CHAIRPERSON
 TO:
   (I) PRESIDE AT ALL MEETINGS OF THE BOARD OF DIRECTORS AND OF THE OFFI-
 CERS;
   (II) MANAGE THE WATER FACILITY,  THE  TRANSMISSION  FACILITY  AND  THE
 DISTRIBUTION  SYSTEM  AND  TO  EFFECTUATE  THE DECISIONS OF THE BOARD OF
 DIRECTORS;
   (III) EXERCISE SUPERVISION  OVER  THE  CONDUCT  OF  THE  OFFICERS  AND
 EMPLOYEES OF THE AUTHORITY;
   (IV)  REPORT  ANNUALLY TO EACH CUSTOMER, EITHER BY MAIL OR BY PUBLICA-
 TION ONCE IN A NEWSPAPER HAVING GENERAL CIRCULATION WITHIN THE DISTRICT;
 SUCH REPORT SHALL INCLUDE BUT NOT BE LIMITED TO THE  FOLLOWING  INFORMA-
 TION:
   (1)  A  BRIEF  FINANCIAL  ACCOUNT  ON  OPERATIONS  OF THE WATER SYSTEM
 INCLUDING, BUT NOT LIMITED TO, WATER RATES,  TOTAL  REVENUES,  OPERATING
 AND MAINTENANCE EXPENSES, AND INTEREST ON BONDS AND NOTES;
   (2) THE POPULATION SERVED BY THE AUTHORITY;
   (3)  THE NUMBER OF WELLS, TOWERS AND OTHER STORAGE FACILITIES OPERATED
 BY THE AUTHORITY;
   (4) THE TOTAL PUMPAGE OF GROUNDWATER  INCLUDING  THE  AMOUNT  RECEIVED
 THROUGH  INTERDISTRICT  INTERCONNECTIONS  AND  THE ESTIMATED AMOUNT LOST
 FROM THE SYSTEM;

 A. 1204                             7
 
   (5) THE SINGLE HIGHEST LEVEL FROM EACH WELL OF EACH SYNTHETIC  ORGANIC
 CHEMICAL,  NITRATE  AND CHLORIDE CONSTITUENT TESTED FOR BY THE AUTHORITY
 AT ANY TIME DURING THE YEAR WHICH EXCEEDS THE  APPLICABLE  COUNTY  WATER
 QUALITY  STANDARD  OR GUIDELINE, THAT STANDARD OR GUIDELINE, THE SITE OF
 EACH  WELL AT WHICH EACH REPORTED CONSTITUENT WAS FOUND, AND THE DATE ON
 WHICH EACH REPORTED CONSTITUENT WAS ANALYZED;
   (6) THE HIGHEST LEVEL FROM EACH WELL OF EACH SYNTHETIC ORGANIC  CHEMI-
 CAL, NITRATE AND CHLORIDE CONSTITUENT TESTED FOR BY THE AUTHORITY AT ANY
 TIME  DURING  THE YEAR WHICH DOES NOT EXCEED THE APPLICABLE COUNTY WATER
 STANDARD OR GUIDELINE, BUT WHICH CONTAINS A LEVEL EQUAL  TO  OR  GREATER
 THAN  TWO-THIRDS  OF THE AMOUNT PERMITTED BEFORE EXCEEDING A STANDARD OR
 GUIDELINE, THAT STANDARD OR GUIDELINE, THE SITE OF EACH  WELL  AT  WHICH
 EACH  REPORTED CONSTITUENT WAS FOUND AND THE DATE ON WHICH EACH REPORTED
 CONSTITUENT WAS ANALYZED;
   (7) ONCE EVERY FIVE  YEARS,  THE  HIGHEST  LEVEL  OF  ANY  CONSTITUENT
 DISCOVERED  WITHIN  THE DISTRIBUTION SYSTEM WHICH CONTAINS A LEVEL EQUAL
 TO OR GREATER THAN TWO-THIRDS OF THE AMOUNT PERMITTED BEFORE EXCEEDING A
 STANDARD OR GUIDELINE, THAT STANDARD OR  GUIDELINE,  AND  THE  RESULTING
 ACTION TAKEN BY THE AUTHORITY;
   (8)  ANY WELL RESTRICTED, REMOVED FROM SERVICE OR OTHERWISE LIMITED IN
 ITS USE AND THE CAUSE FOR SUCH ACTION;
   (9) ANY ACTIONS TAKEN TO SECURE NEW SUPPLIES OR REPLACE LOST CAPACITY;
   (10) THE TYPES OF TREATMENT WHICH THE WATER RECEIVES  BEFORE  ENTERING
 THE DISTRIBUTION SYSTEM;
   (11)  ANY COMPLIANCE ACTIVITIES REQUIRED BY REGULATIONS OF THE DEPART-
 MENT OF ENVIRONMENTAL CONSERVATION OR THE DEPARTMENT OF  HEALTH  OR  ANY
 LOCAL HEALTH DEPARTMENT AND ANY INSTANCES OF NONCOMPLIANCE;
   (12)  THE PRESENT CONDITION OF THE DISTRIBUTION SYSTEM AND ANY SIGNIF-
 ICANT ACTIONS, AS DETERMINED BY THE AUTHORITY, TO  IMPROVE  OR  MAINTAIN
 THE SYSTEM;
   (13)  ANY  SPECIAL  PUBLIC  SERVICES THE AUTHORITY PROVIDES DURING THE
 YEAR; AND
   (14) INFORMATION ON WATER CONSERVATION MEASURES CUSTOMERS  CAN  IMPLE-
 MENT,  SUCH  AS,  BUT  NOT  LIMITED  TO, RETROFITTING PLUMBING FIXTURES,
 ALTERING IRRIGATION TIMING, USING IRRIGATION  SENSORS,  LEAK  DETECTION,
 PROPER  USE  OF  WATER-CONSUMING  APPLIANCES, DAILY CONSCIENTIOUS USE OF
 WATER AND ESTIMATED SAVINGS OF WATER, ENERGY, AND  MONEY,  FROM  USE  OF
 THESE MEASURES;
   (V) EXECUTE ALL CONTRACTS IN THE NAME OF THE AUTHORITY;
   (VI)  INSTITUTE, AT THE DIRECTION OF THE BOARD OF DIRECTORS, ALL CIVIL
 ACTIONS IN THE NAME OF THE AUTHORITY;
   (VII) PROVIDE FOR THE ENFORCEMENT OF ALL OF THE RULES AND  REGULATIONS
 OF THE AUTHORITY AND CAUSE ALL VIOLATIONS THEREOF TO BE PROSECUTED;
   (VIII)  SIGN  ORDERS  TO  PAY  CLAIMS  WHEN AUTHORIZED BY THE BOARD OF
 DIRECTORS;
   (IX) SIGN CHECKS IN THE ABSENCE OR INABILITY OF THE TREASURER OR DEPU-
 TY TREASURER, IF ANY, WHEN AUTHORIZED BY THE BOARD OF DIRECTORS;  AND  A
 CERTIFIED  COPY OF A RESOLUTION OF THE BOARD OF DIRECTORS TO THAT EFFECT
 SHALL BE NOTICE TO THE DEPOSITORY OF SUCH AUTHORIZATION;
   (X) APPOINT, SUBJECT TO THE APPROVAL OF THE BOARD OF DIRECTORS,  NONE-
 LECTED  OFFICERS,  COUNSEL,  ACCOUNTANTS,  AND OTHER FINANCIAL ADVISORS,
 ENGINEERS AND OTHER TECHNICAL ADVISORS;
   (XI) EMPLOY, PROMOTE AND DISCHARGE MANAGERS, SUPERVISORS  AND  EMPLOY-
 EES; AND
   (XII) TAKE ALL OTHER REASONABLE AND NECESSARY ACTIONS TO CARRY OUT HIS
 OR  HER  OFFICE  AS  THE CHIEF EXECUTIVE OF THE AUTHORITY. IF THE CHAIR-

 A. 1204                             8
 
 PERSON HAS NOT BEEN APPOINTED AS A MEMBER OF THE BOARD OF  DIRECTORS  OF
 THE AUTHORITY PURSUANT TO THIS SECTION, SUCH CHAIRPERSON SHALL BE DEEMED
 AN  EX  OFFICIO  MEMBER OF THE BOARD OF DIRECTORS. SUCH STATUS SHALL NOT
 CARRY  WITH  IT  THE RIGHT TO VOTE ON MATTERS COMING BEFORE THE BOARD OF
 DIRECTORS NOR SHALL THE PRESENCE OF SUCH CHAIRPERSON BE COUNTED FOR  THE
 PURPOSE OF DETERMINING A QUORUM.
   (B)  VICE  CHAIRPERSON.  THE VICE CHAIRPERSON SHALL PERFORM ALL DUTIES
 DELEGATED TO HIM OR HER BY THE CHAIRPERSON AND, IN THE ABSENCE OR DURING
 THE DISABILITY OF THE CHAIRPERSON, THE VICE  CHAIRPERSON  SHALL  ACT  AS
 CHAIRPERSON.
   (C)  DEPUTY  CHAIRPERSON.  THE  DEPUTY  CHAIRPERSON  SHALL PERFORM ALL
 DUTIES DELEGATED TO HIM OR HER BY THE CHAIRPERSON  OR  THE  VICE  CHAIR-
 PERSON.
   (D)  SECRETARY.  (I)  THE  SECRETARY SHALL BE THE RECORDING AND CORRE-
 SPONDING OFFICER OF THE AUTHORITY AND THE CUSTODIAN OF  THE  RECORDS  OF
 THE AUTHORITY.
   (II)  THE  SECRETARY  SHALL  PREPARE  AND SEND REQUIRED NOTICES OF ALL
 MEETINGS WHEN DIRECTED TO DO SO BY THE CHAIRPERSON  OR  BY  THE  WRITTEN
 REQUEST OF FOUR MEMBERS WHO HAVE SPECIFIED THE ISSUES TO BE DISCUSSED AT
 THE MEETING.
   (III)  IN  THE ABSENCE OR DISABILITY OF THE SECRETARY, THE CHAIRPERSON
 MAY APPOINT A TEMPORARY SECRETARY.
   (E) TREASURER. (I) THE TREASURER SHALL  HAVE  CUSTODY  OF  ALL  MONEYS
 BELONGING TO THE AUTHORITY AND KEEP ACCOUNTS OF ALL RECEIPTS AND EXPEND-
 ITURES  IN  CONFORMANCE WITH A UNIFORM SYSTEM OF ACCOUNTS FORMULATED AND
 PRESCRIBED BY THE COMPTROLLER PURSUANT  TO  SECTION  THIRTY-SIX  OF  THE
 GENERAL MUNICIPAL LAW.
   (II) THE TREASURER SHALL EXECUTE A BOND, CONDITIONED UPON THE FAITHFUL
 PERFORMANCE  OF  THE  DUTIES OF HIS OR HER OFFICE, THE AMOUNT AND SUFFI-
 CIENCY OF WHICH SHALL BE APPROVED BY THE  BOARD  OF  DIRECTORS  AND  THE
 PREMIUM THEREFOR SHALL BE PAID BY THE AUTHORITY.
   (III) THE TREASURER SHALL DEPOSIT, WITHIN TEN DAYS AFTER RECEIPT THER-
 EOF,  IN  THE  NAME OF THE AUTHORITY, IN ONE OR MORE BANKS, AND/OR TRUST
 COMPANIES, DESIGNATED BY THE BOARD OF DIRECTORS, ALL MONEYS RECEIVED  BY
 HIM OR HER.
   (IV) THE TREASURER MAY SIGN CHECKS WITH THE FACSIMILE SIGNATURE OF THE
 TREASURER,  AS  REPRODUCED  BY  A  MACHINE OR DEVICE COMMONLY KNOWN AS A
 CHECKSIGNER, WHEN AUTHORIZED BY THE BOARD OF DIRECTORS.
   (V) THE TREASURER SHALL PAY OUT MONEYS  FROM  THE  AUTHORITY  TREASURY
 ONLY  AS  AUTHORIZED  BY  THE  BOARD  OF  DIRECTORS AND BY LAW. ALL SUCH
 PAYMENTS, EXCEPT AS MAY BE AUTHORIZED BY THE BOARD OF  DIRECTORS  FOR  A
 PETTY CASH ACCOUNT, SHALL BE BY CHECK.
   (VI) THE TREASURER SHALL ISSUE A REPORT ON THE FINANCES OF THE AUTHOR-
 ITY AT EACH REGULAR MEETING OF THE BOARD OF DIRECTORS.
   (VII)  THE TREASURER SHALL FILE IN THE OFFICE OF THE AUTHORITY, WITHIN
 SIXTY DAYS AFTER THE END OF THE FISCAL  YEAR,  A  STATEMENT  SHOWING  IN
 DETAIL ALL REVENUES AND EXPENDITURES DURING THE PREVIOUS FISCAL YEAR AND
 THE  OUTSTANDING  INDEBTEDNESS  OF  THE  AUTHORITY  AS OF THE END OF THE
 FISCAL YEAR. THE MEMBERS SHALL, WITHIN TEN DAYS, CAUSE TO  BE  PUBLISHED
 ONCE  IN  A  NEWSPAPER HAVING GENERAL CIRCULATION WITHIN THE DISTRICT, A
 NOTICE THAT THE ANNUAL FINANCIAL STATEMENT HAS BEEN FILED AND IS  AVAIL-
 ABLE FOR INSPECTION OR A SUMMARY OF SUCH STATEMENT IN A FORM APPROVED BY
 THE COMPTROLLER, WITH AN ENDORSEMENT THEREON THAT DETAILS THEREOF ARE ON
 FILE  IN  THE  OFFICE  OF  THE  AUTHORITY. THE MEMBERS SHALL CAUSE TO BE
 AUDITED BY A CERTIFIED PUBLIC ACCOUNTANT ENGAGED FOR THAT PURPOSE,  SUCH
 REPORT AND SUPPORTING RECORDS.

 A. 1204                             9
 
   8.  THE  TERMS  OF THE CHAIRPERSON, VICE CHAIRPERSON AND DEPUTY CHAIR-
 PERSON  FIRST  APPOINTED  SHALL  BE  STAGGERED,  THE  CHAIRPERSON  FIRST
 APPOINTED  SHALL  SERVE FOR A PERIOD OF FOUR YEARS, THE VICE CHAIRPERSON
 FIRST APPOINTED SHALL SERVE FOR A PERIOD OF THREE YEARS AND  THE  DEPUTY
 CHAIRPERSON FIRST APPOINTED SHALL SERVE FOR A PERIOD OF TWO YEARS; THER-
 EAFTER THEIR SUCCESSORS SHALL SERVE FOR TERMS OF FOUR YEARS. THE REMAIN-
 ING OFFICERS SHALL EACH SERVE TERMS OF ONE YEAR.  THE BOARD OF DIRECTORS
 SHALL HAVE THE RIGHT, AT ANY TIME, TO EXTEND ANY SUCH TERM, FOR A PERIOD
 OF  MONTHS,  TO PROVIDE THAT SUCH TERM TERMINATES CONTEMPORANEOUSLY WITH
 THE END OF THE FISCAL YEAR OF THE AUTHORITY.
   9. THE OFFICERS OF THE AUTHORITY SHALL RECEIVE SUCH  COMPENSATION  FOR
 THEIR  SERVICES AS SHALL BE FIXED BY THE BOARD OF DIRECTORS AND SHALL BE
 REIMBURSED FOR ALL NECESSARY AND ACTUAL EXPENSES INCURRED IN  CONNECTION
 WITH  THEIR  DUTIES AS SUCH OFFICERS AND IN CONNECTION WITH THE CARRYING
 OUT OF THE PURPOSES OF THIS TITLE.
   10. THE AUTHORITY AND ITS CORPORATE  EXISTENCE  SHALL  CONTINUE  UNTIL
 TERMINATED BY LAW; PROVIDED, HOWEVER, THAT NO SUCH LAW SHALL TAKE EFFECT
 SO LONG AS THE AUTHORITY SHALL HAVE BONDS OR OTHER OBLIGATIONS OUTSTAND-
 ING UNLESS ADEQUATE PROVISION HAS BEEN MADE FOR THE PAYMENT OR SATISFAC-
 TION THEREOF. UPON TERMINATION OF THE EXISTENCE OF THE AUTHORITY, ALL OF
 THE  RIGHTS AND PROPERTIES OF THE AUTHORITY THEN REMAINING SHALL PASS TO
 AND VEST IN THE MUNICIPALITIES WITHIN THE DISTRICT. SUCH PROPERTY  SHALL
 BE  APPORTIONED  AND  DISTRIBUTED  AMONG  THE  MUNICIPALITIES WITHIN THE
 DISTRICT IN DIRECT PROPORTION TO THEIR WEIGHTED VOTING ON  THE  DATE  OF
 THE TERMINATION OF THE AUTHORITY.
   11. IN ADDITION TO ANY POWERS GRANTED TO IT BY LAW, THE GOVERNING BODY
 OF  EACH  OF  THE MUNICIPALITIES WITHIN THE DISTRICT, FROM TIME TO TIME,
 MAY APPROPRIATE SUMS OF MONEY TO DEFRAY PROJECT COSTS OR ANY OTHER COSTS
 AND EXPENSES OF THE AUTHORITY.  SUBJECT TO THE  RIGHTS  OF  BONDHOLDERS,
 EACH GOVERNING BODY MAY DETERMINE IF THE MONEYS SO APPROPRIATED SHALL BE
 SUBJECT TO REPAYMENT BY THE AUTHORITY TO THE MUNICIPALITIES, AND IN SUCH
 EVENT, THE MANNER AND TIME OR TIMES FOR SUCH REPAYMENT.
   12.  NEITHER  THE  PUBLIC  SERVICE  COMMISSION  NOR ANY OTHER BOARD OR
 COMMISSION OF LIKE CHARACTER, SHALL HAVE JURISDICTION OVER THE AUTHORITY
 IN THE MANAGEMENT AND CONTROL OF ITS PROPERTIES  OR  OPERATIONS  OR  ANY
 POWER  OVER  THE  REGULATION  OF RATES FIXED OR CHARGES COLLECTED BY THE
 AUTHORITY.
   13. IT IS HEREBY DETERMINED AND DECLARED THAT THE  AUTHORITY  AND  THE
 CARRYING  OUT OF ITS POWERS, PURPOSES AND DUTIES ARE IN ALL RESPECTS FOR
 THE BENEFIT OF THE PEOPLE OF THE MUNICIPALITIES WITHIN THE DISTRICT  AND
 STATE,  FOR  THE IMPROVEMENT OF THEIR HEALTH, WELFARE AND PROSPERITY AND
 THAT THE SAID PURPOSES ARE PUBLIC PURPOSES AND THAT THE AUTHORITY IS AND
 WILL BE PERFORMING AN ESSENTIAL GOVERNMENTAL FUNCTION IN THE EXERCISE OF
 THE POWERS CONFERRED UPON IT BY THIS TITLE.
   § 1114-E. POWERS OF THE AUTHORITY. EXCEPT AS OTHERWISE LIMITED BY THIS
 TITLE, THE AUTHORITY SHALL HAVE THE POWER TO:
   1. SUE AND BE SUED;
   2. HAVE A SEAL AND ALTER THE SAME AT PLEASURE;
   3. BORROW MONEY AND ISSUE NEGOTIABLE OR NON-NEGOTIABLE  NOTES,  BONDS,
 OR OTHER OBLIGATIONS AND TO PROVIDE FOR THE RIGHTS OF THE HOLDERS THERE-
 OF;
   4.  ENTER  INTO  CONTRACTS  AND  EXECUTE  ALL INSTRUMENTS NECESSARY OR
 CONVENIENT OR DESIRABLE FOR THE PURPOSES OF THE AUTHORITY TO  CARRY  OUT
 ANY POWERS EXPRESSLY GIVEN IT IN THIS TITLE;
   5.  ACQUIRE,  BY PURCHASE, GIFT, GRANT, TRANSFER, CONTRACT OR LEASE OR
 BY CONDEMNATION PURSUANT TO THE EMINENT DOMAIN PROCEDURE LAW,  LEASE  AS

 A. 1204                            10
 
 LESSEE, HOLD AND USE AND TO SELL, LEASE AS LESSOR, TRANSFER OR OTHERWISE
 DISPOSE OF, ANY REAL OR PERSONAL PROPERTY OR ANY INTEREST THEREIN, WITH-
 IN  OR  WITHOUT  THE  DISTRICT, BUT WITHIN THE TERRITORIAL LIMITS OF THE
 TOWN  OF OYSTER BAY OR NORTH HEMPSTEAD, AS THE AUTHORITY MAY DEEM NECES-
 SARY, CONVENIENT OR DESIRABLE TO CARRY OUT THE PURPOSE  OF  THIS  TITLE;
 PROVIDED, HOWEVER, THAT THE AUTHORITY MAY NOT CONDEMN REAL PROPERTY OF A
 MUNICIPALITY  WITHOUT  THE CONSENT OF THE GOVERNING BODY OF SUCH MUNICI-
 PALITY;
   6. PURCHASE, IN THE NAME OF THE AUTHORITY, ANY  WATER  SUPPLY  SYSTEM,
 INCLUDING PLANTS, WORKS, INSTRUMENTALITIES OR PARTS THEREOF AND APPURTE-
 NANCES  THERETO,  LANDS,  EASEMENTS,  RIGHTS  IN  LAND AND WATER RIGHTS,
 RIGHTS-OF-WAY,  CONTRACT  RIGHTS,   FRANCHISES,   PERMITS,   APPROACHES,
 CONNECTIONS, DAMS, WELLS, PUMPS, RESERVOIRS, WATER MAINS AND PIPE LINES,
 PUMPING STATIONS, TREATMENT FACILITIES, METERS, EQUIPMENT AND INVENTORY,
 OR  ANY OTHER PROPERTY INCIDENTAL TO AND INCLUDED IN SUCH SYSTEM OR PART
 THEREOF, AND ANY  IMPROVEMENTS,  EXTENSIONS  AND  BETTERMENTS,  SITUATED
 WHOLLY  WITHIN THE DISTRICT, PROVIDED, HOWEVER, THAT THE AUTHORITY SHALL
 HAVE THE POWER TO PURCHASE ANY SOURCE OF SUPPLY, OR WATER SUPPLY  SYSTEM
 OR  ANY  PART  THEREOF SITUATED WHOLLY OR PARTLY WITHOUT THE TERRITORIAL
 LIMITS OF THE DISTRICT, PROVIDED SAME SHALL BE  NECESSARY  IN  ORDER  TO
 SUPPLY  WATER WITHIN THE DISTRICT AND IN CONNECTION WITH THE PURCHASE OF
 SUCH PROPERTIES THE AUTHORITY MAY ASSUME ANY OBLIGATIONS OF THE OWNER OF
 SUCH PROPERTIES AND, TO THE EXTENT REQUIRED BY THE TERMS OF  ANY  INDEN-
 TURES OR OTHER INSTRUMENTS UNDER WHICH SUCH OBLIGATIONS WERE ISSUED, THE
 AUTHORITY  MAY  ASSUME  AND  AGREE  TO PERFORM COVENANTS AND OBSERVE THE
 RESTRICTIONS CONTAINED IN SUCH INSTRUMENTS; AND FURTHERMORE THE OWNER OF
 ANY PROPERTIES, WHICH THE AUTHORITY IS AUTHORIZED TO ACQUIRE, IS  HEREBY
 AUTHORIZED  TO  SELL  OR  OTHERWISE  TRANSFER THE SAME TO THE AUTHORITY,
 WHEREUPON THE AUTHORITY SHALL BECOME CHARGED WITH THE PERFORMANCE OF ALL
 PUBLIC DUTIES WITH RESPECT TO SUCH PROPERTIES WITH WHICH SUCH OWNER  WAS
 CHARGED  AND  SUCH  OWNER  SHALL  BECOME DISCHARGED FROM THE PERFORMANCE
 THEREOF, AS A MEANS OF SO ACQUIRING FOR SUCH PURPOSE, THE AUTHORITY  MAY
 PURCHASE  ALL  OF THE STOCK OF ANY EXISTING PRIVATELY OWNED WATER CORPO-
 RATION OR COMPANY AND IN THE CASE OF A SALE OR OTHER TRANSFER OF PROPER-
 TIES OF A PUBLIC UTILITY CORPORATION PURSUANT TO  THIS  PROVISION,  UPON
 THE  PURCHASE  OF  THE  STOCK OF SUCH CORPORATION OR COMPANY IT SHALL BE
 LAWFUL TO DISSOLVE SUCH CORPORATION WITHIN A REASONABLE TIME;
   7. CONSTRUCT, IMPROVE OR REHABILITATE WATER SUPPLY FACILITIES REQUIRED
 FOR THE MAINTENANCE, DEVELOPMENT OR EXPANSION OF WATER SUPPLY SOURCES;
   8. OPERATE AND MANAGE AND TO CONTRACT FOR THE OPERATION AND MANAGEMENT
 OF FACILITIES OF THE AUTHORITY;
   9. ENTER INTO CONTRACTS, AND CARRY OUT  THE  TERMS  THEREOF,  FOR  THE
 WHOLESALE  PROVISION  OF WATER PRODUCED BY SUPPLY FACILITIES CONSTRUCTED
 AND OPERATED BY THE  AUTHORITY,  TO  MUNICIPALITIES  AND  PRIVATE  WATER
 COMPANIES  AND  TO  CARRY OUT THE TERMS THEREOF, FOR THE TRANSMISSION OF
 WATER FROM NEW OR EXISTING SUPPLY FACILITIES;
   10. APPLY TO THE APPROPRIATE AGENCIES AND OFFICIALS  OF  THE  FEDERAL,
 STATE  AND  LOCAL GOVERNMENTS FOR SUCH LICENSES, PERMITS OR APPROVALS OF
 ITS PLANS OR PROJECTS AS IT MAY DEEM NECESSARY OR  ADVISABLE,  AND  UPON
 SUCH  TERMS AND CONDITIONS AS IT MAY DEEM APPROPRIATE, TO ACCEPT, IN ITS
 DISCRETION, SUCH LICENSES, PERMITS OR APPROVALS AS MAY BE TENDERED TO IT
 BY SUCH AGENCIES AND OFFICIALS;
   11. TAKE ALL NECESSARY AND REASONABLE ACTIONS WITHIN THE  DISTRICT  TO
 CONSERVE, PRESERVE AND PROTECT THE WATER SUPPLY TO THE DISTRICT, INCLUD-
 ING THE MAKING OF PLANS AND STUDIES, THE ADOPTION OF WATERSHED RULES AND
 REGULATIONS,  THE  ENFORCING  OF  COMPLIANCE WITH ALL CURRENT AND FUTURE

 A. 1204                            11
 
 RULES AND REGULATIONS OF THE STATE SANITARY CODE WITH  REGARD  TO  WATER
 SUPPLY  AND  USAGE,  THE  REQUIRING  OF  CROSS-CONNECTION  CONTROLS, THE
 PROVIDING OF EDUCATIONAL MATERIAL AND PROGRAMS TO THE  PUBLIC,  AND  THE
 COOPERATING  WITH  WATER  SUPPLIERS  OUTSIDE  THE  DISTRICT TO CONSERVE,
 PRESERVE AND PROTECT THE ENTIRE WATER RESERVE AS IT IS  AFFECTED  WITHIN
 AND OUTSIDE THE AUTHORITY'S SUPPLY AREA;
   12. RETAIN OR EMPLOY COUNSEL, AUDITORS, ENGINEERS AND PRIVATE CONSULT-
 ANTS  ON  A  CONTRACT  BASIS  OR OTHERWISE FOR RENDERING PROFESSIONAL OR
 TECHNICAL SERVICES AND ADVICE;
   13. MAKE PLANS AND STUDIES NECESSARY, CONVENIENT OR DESIRABLE FOR  THE
 EFFECTUATION  OF THE PURPOSES AND POWERS OF THE AUTHORITY AND TO PREPARE
 RECOMMENDATIONS IN REGARD THERETO;
   14. PREPARE A WATER SUPPLY EMERGENCY PLAN WHICH SHALL INCLUDE, BUT NOT
 BE LIMITED TO, THE FOLLOWING:
   (A) ESTABLISHMENT OF CRITERIA AND  PROCEDURES  TO  DETERMINE  CRITICAL
 WATER LEVELS OR SAFE YIELD OF SYSTEM;
   (B)  IDENTIFICATION  OF  EXISTING  AND  FUTURE  SOURCES OF WATER UNDER
 NORMAL CONDITIONS AND EMERGENCY CONDITIONS;
   (C) SYSTEM CAPACITY AND ABILITY TO MEET PEAK  DEMAND  AND  FIRE  FLOWS
 CONCURRENTLY;
   (D) STORAGE CAPACITIES;
   (E)  CURRENT  CONDITION OF PRESENT INTERCONNECTIONS AND IDENTIFICATION
 OF ADDITIONAL INTERCONNECTIONS TO MEET A WATER SUPPLY EMERGENCY;
   (F) A SPECIFIC ACTION PLAN TO BE FOLLOWED DURING A WATER SUPPLY  EMER-
 GENCY INCLUDING A PHASED IMPLEMENTATION OF THE PLAN;
   (G) GENERAL WATER CONSERVATION PROGRAMS AND WATER USE REDUCTION STRAT-
 EGIES FOR WATER SUPPLY USERS;
   (H) PRIORITIZATION OF WATER USERS;
   (I)  IDENTIFICATION  AND  AVAILABILITY  OF  EMERGENCY EQUIPMENT NEEDED
 DURING A WATER SUPPLY EMERGENCY; AND
   (J) A PUBLIC NOTIFICATION PROGRAM COORDINATED WITH THE  PHASED  IMPLE-
 MENTATION  SCHEDULE; SUCH PLAN SHALL NOT BE ADOPTED UNTIL A PUBLIC HEAR-
 ING ON SUCH PLAN SHALL HAVE BEEN HELD, UPON NOT LESS THAN FOURTEEN DAYS'
 NOTICE THEREOF TO EACH CUSTOMER, EITHER BY MAIL OR BY  PUBLICATION  ONCE
 IN  A  NEWSPAPER  HAVING  GENERAL CIRCULATION WITHIN THE DISTRICT; EVERY
 FIVE YEARS, SUCH PLAN SHALL BE REVIEWED AND REVISED IF NECESSARY AFTER A
 PUBLIC HEARING, WITH NOTICE TO EACH CUSTOMER AS AFORESAID;
   15. ENTER UPON SUCH LANDS, WATERS, OR PREMISES AS IN THE  JUDGMENT  OF
 THE  AUTHORITY  SHALL  BE  NECESSARY  FOR THE PURPOSE OF MAKING SURVEYS,
 SOUNDINGS, BORINGS AND EXAMINATIONS TO ACCOMPLISH ANY PURPOSE AUTHORIZED
 BY THIS TITLE, THE AUTHORITY BEING LIABLE ONLY FOR ACTUAL DAMAGE DONE;
   16. APPLY FOR AND TO ACCEPT ANY GIFTS OR GRANTS OR LOANS OF  FUNDS  OR
 PROPERTY  OR FINANCIAL OR OTHER AID IN ANY FORM FROM THE FEDERAL GOVERN-
 MENT OR ANY AGENCY OR INSTRUMENTALITY THEREOF, OR FROM THE STATE OR  ANY
 AGENCY  OR INSTRUMENTALITY THEREOF, OR FROM ANY OTHER SOURCE, FOR ANY OR
 ALL OF THE PURPOSES SPECIFIED IN THIS TITLE, AND TO COMPLY,  SUBJECT  TO
 THE PROVISIONS OF THIS TITLE, WITH THE TERMS AND CONDITIONS THEREOF;
   17. OBTAIN, STORE, TREAT, DISTRIBUTE, SUPPLY AND SELL WATER FOR DOMES-
 TIC,  COMMERCIAL  AND  PUBLIC PURPOSES AT RETAIL TO INDIVIDUAL CONSUMERS
 WITHIN THE DISTRICT;
   18.  PURCHASE  WATER  FROM  ANY  MUNICIPAL  CORPORATION,  TOWN   WATER
 DISTRICT, PERSON, ASSOCIATION OR CORPORATION;
   19.  PRODUCE,  DEVELOP,  DISTRIBUTE  AND  SELL WATER OR WATER SERVICES
 WITHIN OR WITHOUT THE TERRITORIAL  LIMITS  OF  THE  DISTRICT;  PROVIDED,
 HOWEVER,  THAT  WATER MAY BE SOLD AT RETAIL TO INDIVIDUAL CONSUMERS ONLY
 WITHIN THE DISTRICT AND FURTHER PROVIDED THAT IN EXERCISING  THE  POWERS

 A. 1204                            12
 
 GRANTED  BY  THIS  TITLE, THE AUTHORITY SHALL NOT SELL WATER IN ANY AREA
 WHICH IS SERVED BY A WATER SYSTEM OWNED OR OPERATED BY A MUNICIPALITY OR
 SPECIAL IMPROVEMENT DISTRICT UNLESS THE GOVERNING BODY OF  SUCH  MUNICI-
 PALITY  OR DISTRICT SHALL ADOPT A RESOLUTION REQUESTING THE AUTHORITY TO
 SELL WATER IN SUCH SERVED AREAS;
   20. MAKE BYLAWS FOR THE MANAGEMENT AND REGULATION OF ITS  AFFAIRS  AND
 RULES  AND REGULATIONS FOR THE CONSERVATION, PRESERVATION AND PROTECTION
 OF THE AUTHORITY'S WATER SUPPLY AND, SUBJECT TO  AGREEMENTS  WITH  BOND-
 HOLDERS,  RULES  FOR  THE  SALE OF WATER AND THE COLLECTION OF RENTS AND
 CHARGES THEREFOR. A COPY OF SUCH RULES, REGULATIONS AND BYLAWS  AND  ANY
 RULES  AND  REGULATIONS  ADOPTED  PURSUANT TO SUBDIVISION ELEVEN OF THIS
 SECTION, AND ALL AMENDMENTS THERETO, DULY CERTIFIED BY THE SECRETARY  OF
 THE  AUTHORITY SHALL BE FILED IN THE OFFICE OF THE MUNICIPALITIES WITHIN
 THE DISTRICT AND THEREAFTER PUBLISHED ONCE IN A NEWSPAPER HAVING GENERAL
 CIRCULATION WITHIN THE DISTRICT. VIOLATION OF SUCH RULES AND REGULATIONS
 SHALL BE PUNISHABLE BY FINE, NOT EXCEEDING FIFTY DOLLARS, OR  BY  IMPRI-
 SONMENT FOR NOT LONGER THAN THIRTY DAYS, OR BOTH;
   21. FIX RATES AND COLLECT CHARGES FOR THE USE OF THE FACILITIES OF, OR
 SERVICES RENDERED BY, OR ANY COMMODITIES FURNISHED BY THE AUTHORITY SUCH
 AS TO PROVIDE REVENUES SUFFICIENT AT ALL TIMES TO PAY, AS THE SAME SHALL
 BECOME  DUE,  THE  PRINCIPAL  AND  INTEREST ON THE BONDS, OR OTHER OBLI-
 GATIONS OF  THE  AUTHORITY  TOGETHER  WITH  THE  MAINTENANCE  OF  PROPER
 RESERVES  THEREFOR,  IN ADDITION TO PAYING AS THE SAME SHALL BECOME DUE,
 THE EXPENSE OF OPERATING AND MAINTAINING THE PROPERTIES OF THE AUTHORITY
 TOGETHER WITH PROPER  MAINTENANCE  RESERVES,  CAPITAL  RESERVES,  REPAIR
 RESERVES, TAX STABILIZATION RESERVES AND OTHER CONTINGENCY RESERVES, AND
 ALL  OTHER  OBLIGATIONS  AND  INDEBTEDNESS OF THE AUTHORITY; HOWEVER, NO
 SUCH RATES OR CHARGES SHALL BE CHANGED UNTIL A PUBLIC  HEARING  ON  SUCH
 CHANGES  SHALL  HAVE  BEEN HELD UPON NOT LESS THAN FOURTEEN DAYS' NOTICE
 THEREOF TO EACH CUSTOMER, EITHER BY MAIL OR BY  PUBLICATION  ONCE  IN  A
 NEWSPAPER HAVING GENERAL CIRCULATION WITHIN THE DISTRICT;
   22.  ENTER INTO COOPERATIVE AGREEMENTS WITH OTHER AUTHORITIES, MUNICI-
 PALITIES, COUNTIES, CITIES, TOWNS, VILLAGES,  WATER  DISTRICTS,  UTILITY
 COMPANIES,  INDIVIDUALS,  FIRMS  OR  CORPORATIONS, WITHIN OR WITHOUT THE
 TERRITORIAL LIMITS OF THE DISTRICT FOR THE  INTERCONNECTION  OF  FACILI-
 TIES,  THE  EXCHANGE  OR  INTERCHANGE  OF  SERVICES AND COMMODITIES, THE
 CONSERVATION, PRESERVATION  AND  PROTECTION  OF  THE  AUTHORITY'S  WATER
 RESERVE  AS  IT  IS  AFFECTED  WITHIN AND OUTSIDE THE AUTHORITY'S SUPPLY
 AREA, AND, WITHIN THE TERRITORIAL LIMITS OF THE DISTRICT, TO ENTER  INTO
 A  CONTRACT  FOR  THE CONSTRUCTION, OPERATION AND MAINTENANCE OF A WATER
 SUPPLY AND DISTRIBUTION SYSTEM BY THE  AUTHORITY  FOR  ANY  MUNICIPALITY
 HAVING  POWER  TO  CONSTRUCT AND DEVELOP A WATER SUPPLY AND DISTRIBUTION
 SYSTEM, UPON SUCH TERMS AND CONDITIONS AS  SHALL  BE  DETERMINED  TO  BE
 REASONABLE  INCLUDING, BUT NOT LIMITED TO THE REIMBURSEMENT OF ALL COSTS
 OF SUCH CONSTRUCTION, OR FOR ANY  OTHER  LAWFUL  PURPOSES  NECESSARY  OR
 DESIRABLE TO EFFECT THE PURPOSES OF THIS TITLE;
   23.  PROVIDE  FOR THE DISCONTINUANCE OR DISCONNECTION OF THE SUPPLY OF
 WATER FOR NONPAYMENT OF FEES, RATES, RENTS  OR  OTHER  CHARGES  THEREFOR
 IMPOSED  BY THE AUTHORITY, PROVIDED SUCH DISCONTINUANCE OR DISCONNECTION
 OF ANY SUPPLY OF WATER SHALL NOT BE CARRIED OUT EXCEPT IN THE MANNER AND
 UPON THE NOTICE AS IS REQUIRED OF A WATERWORKS CORPORATION  PURSUANT  TO
 SUBDIVISIONS  THREE-A,  THREE-B AND THREE-C OF SECTION EIGHTY-NINE-B AND
 SECTION ONE HUNDRED SIXTEEN OF THE PUBLIC SERVICE LAW;
   24. CONTRACT FOR, PROVIDE AND MAINTAIN  SUCH  INSURANCE  AS  IT  DEEMS
 NECESSARY OR REASONABLE TO:

 A. 1204                            13
 
   (A) SECURE AND PROTECT ITS REAL AND PERSONAL PROPERTY FROM FIRE, THEFT
 OR OTHER CALAMITY OR LOSS;
   (B) SECURE AND PROTECT IT AGAINST LIABILITY IMPOSED BY LAW FOR DAMAGES
 FOR INJURIES TO PERSONS OR PROPERTY;
   (C)  SECURE  AND PROTECT IT AGAINST ANY LIABILITY WHICH MAY BE IMPOSED
 PURSUANT TO SECTION EIGHTEEN OF THE PUBLIC OFFICERS LAW; AND
   (D) SECURE AND PROTECT IT AGAINST ANY  OTHER  LIABILITY,  CASUALTY  OR
 LOSS AS IT DEEMS NECESSARY OR REASONABLE; AND
   25.  DO ALL THINGS NECESSARY, CONVENIENT OR DESIRABLE TO CARRY OUT ITS
 PURPOSES AND FOR THE EXERCISE OF THE POWERS GRANTED IN THIS TITLE.
   § 1114-F. TRANSFER OF OFFICERS AND EMPLOYEES. ANY  PUBLIC  OFFICER  OR
 EMPLOYEE  UNDER  CIVIL  SERVICE, SELECTED BY THE AUTHORITY MAY, WITH THE
 CONSENT OF THE COMMISSION, BOARD, DEPARTMENT OR MUNICIPALITY BY WHICH HE
 OR SHE HAS BEEN EMPLOYED, BE TRANSFERRED TO THE AUTHORITY AND  SHALL  BE
 ELIGIBLE FOR SUCH TRANSFER AND APPOINTMENT WITHOUT EXAMINATION TO COMPA-
 RABLE  OFFICES, POSITIONS AND EMPLOYMENT UNDER THE AUTHORITY. THE SALARY
 OR COMPENSATION OF ANY SUCH OFFICER OR EMPLOYEE SHALL AFTER SUCH  TRANS-
 FER BE PAID BY THE AUTHORITY, BUT NOTWITHSTANDING THE PROVISIONS OF THIS
 TITLE,  ANY  SUCH OFFICERS OR EMPLOYEES SO TRANSFERRED TO THE AUTHORITY,
 PURSUANT TO THE PROVISIONS OF THIS SECTION, WHO ARE MEMBERS OF OR  BENE-
 FICIARIES UNDER ANY EXISTING PENSION OR RETIREMENT SYSTEM, SHALL CONTIN-
 UE  TO  HAVE ALL RIGHTS, PRIVILEGES, OBLIGATIONS AND STATUS WITH RESPECT
 TO SUCH FUND SYSTEM OR SYSTEMS AS ARE NOW PRESCRIBED BY LAW, BUT  DURING
 THE  PERIOD  OF  THEIR EMPLOYMENT BY THE AUTHORITY, ALL CONTRIBUTIONS TO
 ANY PENSION OR RETIREMENT FUND OR SYSTEM TO BE PAID BY THE  EMPLOYER  ON
 ACCOUNT  OF SUCH OFFICERS AND EMPLOYEES, SHALL BE PAID BY THE AUTHORITY;
 AND ALL SUCH OFFICERS AND EMPLOYEES WHO HAVE BEEN APPOINTED TO POSITIONS
 UNDER THE RULES AND CLASSIFICATIONS  OF  THE  CIVIL  SERVICE  COMMISSION
 SHALL  HAVE  THE  SAME STATUS WITH RESPECT THERETO AFTER TRANSFER TO THE
 AUTHORITY AS THEY HAD UNDER THEIR ORIGINAL APPOINTMENTS. THE APPOINTMENT
 AND PROMOTION OF ALL EMPLOYEES OF THE AUTHORITY SHALL BE MADE IN ACCORD-
 ANCE WITH THE PROVISIONS OF THE CIVIL SERVICE LAW AND SUCH RULES AS  THE
 CIVIL SERVICE COMMISSION MAY ADOPT AND MAKE APPLICABLE TO THE AUTHORITY.
   §  1114-G.  BONDS  OF  THE  AUTHORITY. 1. THE AUTHORITY SHALL HAVE THE
 POWER AND IS HEREBY AUTHORIZED FROM TIME TO  TIME  TO  ISSUE  BONDS,  IN
 CONFORMITY WITH APPLICABLE PROVISIONS OF THE UNIFORM COMMERCIAL CODE, IN
 SUCH  PRINCIPAL  AMOUNTS  AS IT MAY DETERMINE TO BE NECESSARY TO PAY THE
 COST OF ANY WATER  PROJECT  OR  PROJECTS  OR  FOR  ANY  OTHER  CORPORATE
 PURPOSES,  INCLUDING  INCIDENTAL  EXPENSES  IN CONNECTION THEREWITH. THE
 AUTHORITY SHALL HAVE POWER FROM TIME TO TIME TO REFUND ANY BONDS BY  THE
 ISSUANCE  OF NEW BONDS WHETHER THE BONDS TO BE REFUNDED HAVE OR HAVE NOT
 MATURED, AND MAY ISSUE BONDS PARTLY TO REFUND BONDS THEN OUTSTANDING AND
 PARTLY FOR ANY OTHER CORPORATE PURPOSE. BONDS ISSUED  BY  THE  AUTHORITY
 MAY  BE  GENERAL  OBLIGATIONS  SECURED  BY  THE  FAITH AND CREDIT OF THE
 AUTHORITY OR MAY BE SPECIAL OBLIGATIONS PAYABLE SOLELY OUT OF PARTICULAR
 REVENUES OR OTHER MONEYS OF THE AUTHORITY AS MAY BE  DESIGNATED  IN  THE
 PROCEEDINGS  OF  THE AUTHORITY UNDER WHICH THE BONDS SHALL BE AUTHORIZED
 TO BE ISSUED, SUBJECT TO ANY AGREEMENTS WITH THE HOLDERS OF  OUTSTANDING
 BONDS PLEDGING PARTICULAR REVENUES OR MONEYS.
   2. THE AUTHORITY IS AUTHORIZED TO OBTAIN FROM ANY DEPARTMENT OR AGENCY
 OF THE UNITED STATES OF AMERICA OR NONGOVERNMENTAL INSURER ANY INSURANCE
 OR  GUARANTY,  OR ANY OTHER CREDIT ENHANCEMENT ARRANGEMENT WITH ANY BANK
 OR OTHER FINANCIAL INSTITUTION TO THE EXTENT NOW OR HEREAFTER AVAILABLE,
 AS TO, OR FOR THE PAYMENT OR REPAYMENT  OF  INTEREST  OR  PRINCIPAL,  OR
 BOTH,  OR  ANY PART THEREOF, ON ANY BONDS ISSUED BY THE AUTHORITY AND TO
 ENTER INTO ANY AGREEMENT OR CONTRACT WITH RESPECT TO ANY SUCH  INSURANCE

 A. 1204                            14
 
 OR  GUARANTY, EXCEPT TO THE EXTENT THAT THE SAME WOULD IN ANY WAY IMPAIR
 OR INTERFERE WITH THE ABILITY OF THE AUTHORITY TO  PERFORM  AND  FULFILL
 THE  TERMS  OF  ANY  AGREEMENT MADE WITH THE HOLDERS OF THE BONDS OF THE
 AUTHORITY.
   3.  BONDS  SHALL BE AUTHORIZED BY RESOLUTION OF THE AUTHORITY, AND MAY
 BE IN SUCH DENOMINATIONS AND BEAR SUCH DATE OR DATES AND MATURE AT  SUCH
 TIME  OR  TIMES AS SUCH RESOLUTION MAY PROVIDE EXCEPT THAT BONDS AND ANY
 RENEWAL THEREOF SHALL MATURE WITHIN FORTY YEARS OF  THE  DATE  OF  THEIR
 ORIGINAL  ISSUANCE AND NOTES AND ANY RENEWAL THEREOF SHALL MATURE WITHIN
 FIVE YEARS OF THE DATE OF THEIR ORIGINAL ISSUANCE. SUCH BONDS  SHALL  BE
 SUBJECT  TO  SUCH  TERMS  OF  REDEMPTION,  BEAR INTEREST AT SUCH RATE OR
 RATES, WHICH MAY VARY FROM TIME TO TIME, AS MAY BE NECESSARY  TO  EFFECT
 THE  SALE  THEREOF  AND SHALL BE PAYABLE AT SUCH TIMES, BE IN SUCH FORM,
 CARRY SUCH REGISTRATION PRIVILEGES, BE EXECUTED IN SUCH MANNER, BE PAYA-
 BLE IN SUCH MEDIUM OF PAYMENT AT SUCH PLACE OR PLACES, AND BE SUBJECT TO
 SUCH TERMS AND CONDITIONS AS SUCH RESOLUTION MAY PROVIDE. BONDS  MAY  BE
 SOLD  AT  PUBLIC SALE OR AT PRIVATE SALE FOR SUCH PRICE OR PRICES AS THE
 AUTHORITY SHALL DETERMINE, PROVIDED THAT NO ISSUE OF BONDS MAY  BE  SOLD
 AT  PRIVATE  SALE UNLESS THE TERMS OF SUCH SALE SHALL HAVE BEEN APPROVED
 IN WRITING BY:
   (A) THE COMPTROLLER, WHERE SUCH SALE IS NOT TO THE COMPTROLLER; OR
   (B) THE DIRECTOR OF THE DIVISION OF THE BUDGET  OF  THE  STATE,  WHERE
 SUCH SALE IS TO THE COMPTROLLER.
   4.  ANY  RESOLUTION  OR  RESOLUTIONS AUTHORIZING BONDS OR ANY ISSUE OF
 BONDS BY THE AUTHORITY MAY CONTAIN PROVISIONS WHICH MAY BE PART  OF  THE
 CONTRACT WITH THE HOLDERS OF THE BONDS THEREBY AUTHORIZED AS TO:
   (A)  PLEDGING  ALL  OR  PART  OF ITS REVENUES, TOGETHER WITH ANY OTHER
 MONEYS, SECURITIES, CONTRACTS OR PROPERTY, TO SECURE THE PAYMENT OF  THE
 BONDS, SUBJECT TO SUCH AGREEMENTS WITH BONDHOLDERS AS MAY THEN EXIST;
   (B)  THE  RATES,  RENTALS,  FEES  AND  OTHER  CHARGES  TO BE FIXED AND
 COLLECTED AND THE AMOUNTS TO BE RAISED IN EACH YEAR THEREBY, AND THE USE
 AND DISPOSITION OF THE EARNINGS AND OTHER REVENUES;
   (C) THE SETTING ASIDE OF RESERVES AND THE CREATION  OF  SINKING  FUNDS
 AND THE REGULATION AND DISPOSITION THEREOF;
   (D)  LIMITATIONS ON THE PURPOSE TO WHICH THE PROCEEDS FROM THE SALE OF
 BONDS MAY BE APPLIED;
   (E) LIMITATIONS ON THE RIGHT OF THE AUTHORITY TO RESTRICT AND REGULATE
 THE USE OF ANY PROJECT OR PART THEREOF IN CONNECTION  WITH  WHICH  BONDS
 ARE ISSUED;
   (F)  LIMITATIONS  ON  THE ISSUANCE OF ADDITIONAL BONDS, THE TERMS UPON
 WHICH ADDITIONAL BONDS MAY BE ISSUED AND THE REFUNDING OF OUTSTANDING OR
 OTHER BONDS;
   (G) THE PROCEDURE, IF ANY, BY WHICH THE TERMS  OF  ANY  CONTRACT  WITH
 BONDHOLDERS  MAY  BE  AMENDED  OR ABROGATED, INCLUDING THE PROPORTION OF
 BONDHOLDERS WHICH SHALL CONSENT THERETO AND THE  MANNER  IN  WHICH  SUCH
 CONSENT MAY BE GIVEN;
   (H)  THE  CREATION  OF  SPECIAL FUNDS INTO WHICH ANY REVENUES OR OTHER
 MONEYS MAY BE DEPOSITED;
   (I) THE TERMS AND PROVISIONS OF ANY TRUST, DEED OR INDENTURE  SECURING
 THE BONDS UNDER WHICH THE BONDS MAY BE ISSUED;
   (J)  VESTING  IN A TRUSTEE OR TRUSTEES SUCH PROPERTIES, RIGHTS, POWERS
 AND DUTIES IN TRUST AS THE AUTHORITY MAY DETERMINE,  WHICH  MAY  INCLUDE
 ANY  OR ALL OF THE RIGHTS, POWERS AND DUTIES OF THE TRUSTEE APPOINTED BY
 THE BONDHOLDERS PURSUANT TO SECTION ELEVEN HUNDRED  FOURTEEN-H  OF  THIS
 TITLE  AND  LIMITING  OR  ABROGATING  THE  RIGHTS  OF THE BONDHOLDERS TO

 A. 1204                            15
 
 APPOINT A TRUSTEE UNDER SUCH SECTION OR LIMITING THE RIGHTS, DUTIES  AND
 POWERS OF SUCH TRUSTEE;
   (K)  DEFINING  THE  ACTS  OR  OMISSIONS  TO ACT WHICH MAY CONSTITUTE A
 DEFAULT IN THE OBLIGATIONS AND DUTIES OF THE AUTHORITY TO THE  BONDHOLD-
 ERS  AND PROVIDING FOR THE RIGHTS AND REMEDIES OF THE BONDHOLDERS IN THE
 EVENT OF SUCH DEFAULT, INCLUDING AS A MATTER OF RIGHT THE APPOINTMENT OF
 A RECEIVER, PROVIDED, HOWEVER, THAT SUCH RIGHTS AND REMEDIES  SHALL  NOT
 BE  INCONSISTENT WITH THE GENERAL LAWS OF THE STATE AND OTHER PROVISIONS
 OF THIS TITLE;
   (L) LIMITATIONS ON THE POWER OF THE AUTHORITY  TO  SELL  OR  OTHERWISE
 DISPOSE OF ANY SYSTEM OR ANY PART THEREOF OR OTHER PROPERTY;
   (M)  LIMITATIONS  ON  THE  AMOUNT  OF  REVENUES AND OTHER MONEYS TO BE
 EXPENDED FOR OPERATING, ADMINISTRATIVE OR OTHER EXPENSES OF THE AUTHORI-
 TY;
   (N) THE PROTECTION AND ENFORCEMENT OF THE RIGHTS AND REMEDIES  OF  THE
 BONDHOLDERS;
   (O)  THE OBLIGATIONS OF THE AUTHORITY IN RELATION TO THE CONSTRUCTION,
 MAINTENANCE, OPERATION, REPAIRS AND INSURANCE  OF  THE  PROPERTIES,  THE
 SAFEGUARDING  AND  APPLICATION  OF ALL MONEYS AND AS TO THE REQUIREMENTS
 FOR THE SUPERVISION AND APPROVAL OF CONSULTING ENGINEERS  IN  CONNECTION
 WITH CONSTRUCTION, RECONSTRUCTION AND OPERATION;
   (P) THE PAYMENT OF THE PROCEEDS OF BONDS, REVENUES AND OTHER MONEYS TO
 A TRUSTEE OR OTHER DEPOSITORY, AND FOR THE METHOD OF DISBURSEMENT THERE-
 OF WITH SUCH SAFEGUARDS AND RESTRICTIONS AS THE AUTHORITY MAY DETERMINE;
 AND
   (Q)  ANY OTHER MATTERS OF LIKE OR DIFFERENT CHARACTER WHICH IN ANY WAY
 AFFECT THE SECURITY OR PROTECTION OF THE BONDS OR THE RIGHTS  AND  REME-
 DIES OF BONDHOLDERS.
   5.  IN  ADDITION  TO THE POWERS HEREIN CONFERRED UPON THE AUTHORITY TO
 SECURE ITS BONDS, THE AUTHORITY SHALL HAVE POWER IN CONNECTION WITH  THE
 ISSUANCE  OF  BONDS  TO  ENTER INTO SUCH AGREEMENTS AS THE AUTHORITY MAY
 DEEM NECESSARY, CONSISTENT OR DESIRABLE CONCERNING THE USE  OR  DISPOSI-
 TION  OF ITS REVENUES OR OTHER MONEYS OR PROPERTY, INCLUDING REMARKETING
 AGREEMENTS OR OTHER SIMILAR AGREEMENTS FOR THE BONDS, THE MORTGAGING  OF
 ANY PROPERTY AND THE ENTRUSTING, PLEDGING OR CREATION OF ANY OTHER SECU-
 RITY INTEREST IN ANY SUCH REVENUES, MONEYS, OR PROPERTY AND THE DOING OF
 ANY  ACT,  INCLUDING  REFRAINING FROM DOING ANY ACT, WHICH THE AUTHORITY
 WOULD HAVE THE RIGHT TO DO  IN  THE  ABSENCE  OF  SUCH  AGREEMENTS.  THE
 AUTHORITY  SHALL  HAVE POWER TO ENTER INTO AMENDMENTS OF ANY SUCH AGREE-
 MENTS WITHIN THE POWERS GRANTED TO THE AUTHORITY BY THIS  TITLE  AND  TO
 PERFORM  SUCH  AGREEMENTS.  THE PROVISIONS OF ANY SUCH AGREEMENTS MAY BE
 MADE A PART OF THE CONTRACT WITH THE HOLDERS OF BONDS OF THE AUTHORITY.
   6. ANY PROVISION OF  THE  UNIFORM  COMMERCIAL  CODE  TO  THE  CONTRARY
 NOTWITHSTANDING,  ANY  PLEDGE OF OR OTHER SECURITY INTEREST IN REVENUES,
 MONEYS, ACCOUNTS, CONTRACT RIGHTS, GENERAL INTANGIBLES OR OTHER PERSONAL
 PROPERTY MADE OR CREATED BY THE AUTHORITY SHALL BE  VALID,  BINDING  AND
 PERFECTED  FROM  THE  TIME  WHEN  SUCH  PLEDGE IS MADE OR OTHER SECURITY
 INTEREST ATTACHES WITHOUT ANY PHYSICAL DELIVERY  OF  THE  COLLATERAL  OR
 FURTHER  ACT, AND THE LIEN OF ANY SUCH PLEDGE OR OTHER SECURITY INTEREST
 SHALL BE VALID, BINDING AND PERFECTED AGAINST ALL PARTIES HAVING  CLAIMS
 OF  ANY  KIND IN TORT, CONTRACT OR OTHERWISE AGAINST THE AUTHORITY IRRE-
 SPECTIVE OF WHETHER OR NOT SUCH PARTIES HAVE NOTICE THEREOF. NO  INSTRU-
 MENT  BY  WHICH  SUCH  A  PLEDGE OR SECURITY INTEREST IS CREATED NOR ANY
 FINANCING STATEMENT NEED BE RECORDED OR FILED.
   7. WHETHER OR NOT THE BONDS OF THE AUTHORITY  ARE  OF  SUCH  FORM  AND
 CHARACTER AS TO BE NEGOTIABLE INSTRUMENTS UNDER THE TERMS OF THE UNIFORM

 A. 1204                            16
 
 COMMERCIAL CODE, THE BONDS ARE HEREBY MADE NEGOTIABLE INSTRUMENTS WITHIN
 THE  MEANING  OF  AND  FOR  ALL PURPOSES OF THE UNIFORM COMMERCIAL CODE,
 SUBJECT ONLY TO THE PROVISIONS OF THE BONDS FOR REGISTRATION.
   8.  NEITHER  THE MEMBERS OF THE BOARD OF DIRECTORS NOR THE OFFICERS OF
 THE AUTHORITY NOR ANY PERSON EXECUTING BONDS SHALL BE LIABLE  PERSONALLY
 THEREON OR BE SUBJECT TO ANY PERSONAL LIABILITY OR ACCOUNTABILITY SOLELY
 BY REASON OF THE ISSUANCE THEREOF.
   9.  THE AUTHORITY, SUBJECT TO SUCH AGREEMENTS WITH BONDHOLDERS AS THEN
 MAY EXIST, SHALL HAVE POWER OUT OF  ANY  MONEYS  AVAILABLE  THEREFOR  TO
 PURCHASE  BONDS  OF  THE AUTHORITY IN LIEU OF REDEMPTION, AT A PRICE NOT
 EXCEEDING:
   (A) IF THE BONDS ARE THEN REDEEMABLE, THE REDEMPTION PRICE THEN APPLI-
 CABLE, PLUS ACCRUED INTEREST TO THE NEXT INTEREST PAYMENT DATE; OR
   (B) IF THE BONDS ARE NOT THEN REDEEMABLE, THE  REDEMPTION  PRICE  THEN
 APPLICABLE  ON  THE  FIRST DATE AFTER SUCH PURCHASE UPON WHICH THE BONDS
 BECOME SUBJECT TO REDEMPTION PLUS ACCRUED INTEREST TO THE NEXT  INTEREST
 PAYMENT DATE.
   10.  THE  AUTHORITY SHALL HAVE POWER AND IS HEREBY AUTHORIZED TO ISSUE
 NEGOTIABLE  BOND  ANTICIPATION  NOTES  IN  CONFORMITY  WITH   APPLICABLE
 PROVISIONS  OF  THE  UNIFORM COMMERCIAL CODE AND MAY RENEW THE SAME FROM
 TIME TO TIME BUT THE  MAXIMUM  MATURITY  OF  ANY  SUCH  NOTE,  INCLUDING
 RENEWALS  THEREOF, SHALL NOT EXCEED FIVE YEARS FROM THE DATE OF ISSUE OF
 SUCH ORIGINAL NOTE. SUCH NOTES SHALL BE PAID  FROM  ANY  MONEYS  OF  THE
 AUTHORITY  AVAILABLE  THEREFOR  AND  NOT  OTHERWISE  PLEDGED OR FROM THE
 PROCEEDS OF SALE OF THE BONDS OF THE AUTHORITY IN ANTICIPATION OF  WHICH
 THEY  WERE  ISSUED.  THE NOTES SHALL BE ISSUED IN THE SAME MANNER AS THE
 BONDS AND SUCH NOTES AND THE RESOLUTION OR RESOLUTIONS  AUTHORIZING  THE
 SAME  MAY  CONTAIN  ANY  PROVISIONS, CONDITIONS OR LIMITATIONS WHICH THE
 BONDS OR BOND RESOLUTION OF THE AUTHORITY MAY CONTAIN. SUCH NOTES MAY BE
 SOLD AT PUBLIC SALE OR, UPON THE APPROVAL  OF  THE  COMPTROLLER  OF  THE
 TERMS THEREOF, AT PRIVATE SALE.  SUCH NOTES SHALL BE AS FULLY NEGOTIABLE
 AS THE BONDS OF THE AUTHORITY.
   §  1114-H. REMEDIES OF BONDHOLDERS. 1. IN THE EVENT THAT THE AUTHORITY
 SHALL DEFAULT IN THE PAYMENT OF PRINCIPAL OF OR INTEREST ON ANY ISSUE OF
 THE BONDS AFTER THE SAME SHALL BECOME DUE, WHETHER AT MATURITY  OR  UPON
 CALL  FOR  REDEMPTION,  AND  SUCH DEFAULT SHALL CONTINUE FOR A PERIOD OF
 THIRTY DAYS, OR IN THE EVENT THAT THE AUTHORITY SHALL FAIL OR REFUSE  TO
 COMPLY WITH THE PROVISIONS OF THIS TITLE, OR SHALL DEFAULT IN ANY AGREE-
 MENT  MADE  WITH  THE  HOLDERS OF ANY ISSUE OF THE BONDS, THE HOLDERS OF
 TWENTY-FIVE PER CENTUM IN AGGREGATE PRINCIPAL AMOUNT  OF  THE  BONDS  OF
 SUCH  ISSUE  THEN OUTSTANDING, BY INSTRUMENT OR INSTRUMENTS FILED IN THE
 OFFICE OF THE CLERK OF THE APPLICABLE COUNTY AND PROVED OR  ACKNOWLEDGED
 IN  THE  SAME  MANNER AS A DEED TO BE RECORDED, MAY APPOINT A TRUSTEE TO
 REPRESENT THE HOLDERS OF SUCH BONDS FOR THE PURPOSES HEREIN PROVIDED.
   2. SUCH TRUSTEE MAY, AND UPON WRITTEN REQUEST OF THE HOLDERS OF  TWEN-
 TY-FIVE  PER CENTUM IN PRINCIPAL AMOUNT OF SUCH BONDS OUTSTANDING SHALL,
 IN HIS OR HER OWN NAME:
   (A) BY ACTION OR PROCEEDING IN ACCORDANCE WITH THE CIVIL PRACTICE  LAW
 AND RULES, ENFORCE ALL RIGHTS OF THE BONDHOLDERS AND REQUIRE THE AUTHOR-
 ITY TO CARRY OUT ANY OTHER AGREEMENTS WITH THE HOLDERS OF SUCH BONDS AND
 TO PERFORM ITS DUTIES UNDER THIS TITLE;
   (B) BRING AN ACTION OR PROCEEDING UPON SUCH BONDS;
   (C) BY ACTION OR PROCEEDING, REQUIRE THE AUTHORITY TO ACCOUNT AS IF IT
 WERE THE TRUSTEE OF AN EXPRESS TRUST FOR THE HOLDERS OF SUCH BONDS;
   (D)  BY  ACTION  OR PROCEEDING, ENJOIN ANY ACTS OR THINGS WHICH MAY BE
 UNLAWFUL OR IN VIOLATION OF THE RIGHTS OF THE HOLDERS OF SUCH BONDS; AND

 A. 1204                            17
 
   (E) DECLARE ALL SUCH BONDS DUE AND PAYABLE, AND IF ALL DEFAULTS  SHALL
 BE  MADE  GOOD,  THEN WITH THE CONSENT OF THE HOLDERS OF TWENTY-FIVE PER
 CENTUM OF THE PRINCIPAL AMOUNT OF SUCH  BONDS  THEN  OUTSTANDING,  ANNUL
 SUCH DECLARATION AND ITS CONSEQUENCES.
   3.  SUCH  TRUSTEE  SHALL IN ADDITION TO THE FOREGOING HAVE AND POSSESS
 ALL OF THE POWERS NECESSARY OR APPROPRIATE FOR THE EXERCISE OF ANY FUNC-
 TIONS SPECIFICALLY SET FORTH HEREIN OR INCIDENTAL TO THE GENERAL  REPRE-
 SENTATION  OF  BONDHOLDERS  IN  THE  ENFORCEMENT AND PROTECTION OF THEIR
 RIGHTS.
   4. THE STATE SUPREME COURT, COUNTY OF NASSAU AND THE STATE SHALL  HAVE
 JURISDICTION  OF  ANY  ACTION  OR PROCEEDING BY THE TRUSTEE ON BEHALF OF
 SUCH BONDHOLDERS.
   5. BEFORE DECLARING THE PRINCIPAL OF BONDS DUE AND PAYABLE, THE  TRUS-
 TEE SHALL FIRST GIVE THIRTY DAYS' NOTICE IN WRITING TO THE AUTHORITY.
   §  1114-I.  STATE  AND  MUNICIPALITIES  NOT LIABLE ON AUTHORITY BONDS.
 NEITHER THE STATE NOR ANY MUNICIPALITY SHALL BE LIABLE ON THE  BONDS  OF
 THE  AUTHORITY AND SUCH BONDS SHALL NOT BE A DEBT OF THE STATE OR OF ANY
 MUNICIPALITY.
   § 1114-J. MONEYS OF THE AUTHORITY. ALL MONEYS OF  THE  AUTHORITY  FROM
 WHATEVER  SOURCE  DERIVED  SHALL  BE  PAID TO THE TREASURER AND SHALL BE
 DEPOSITED FORTHWITH IN ONE OR MORE BANKS AND/OR TRUST COMPANIES  IN  THE
 STATE  DESIGNATED BY THE AUTHORITY. THE MONEYS IN SUCH ACCOUNTS SHALL BE
 PAID OUT ON CHECKS OF THE TREASURER UPON REQUISITION BY THE  CHAIRPERSON
 OF  THE  AUTHORITY OR OF SUCH OTHER OFFICER OR OFFICERS AS THE AUTHORITY
 MAY AUTHORIZE TO MAKE SUCH REQUISITIONS. ALL  DEPOSITS  OF  SUCH  MONEYS
 SHALL BE SECURED BY OBLIGATIONS OF OR GUARANTEED BY THE UNITED STATES OF
 AMERICA  OR  OF  THE  STATE  OF A MARKET VALUE EQUAL AT ALL TIMES TO THE
 AMOUNT ON DEPOSIT AND ALL BANKS AND TRUST COMPANIES  ARE  AUTHORIZED  TO
 GIVE  SUCH  SECURITY  FOR SUCH DEPOSITS. ANY MONEYS OF THE AUTHORITY NOT
 REQUIRED FOR IMMEDIATE USE OR DISBURSEMENT MAY, AT THE DISCRETION OF THE
 AUTHORITY, BE INVESTED IN THOSE OBLIGATIONS SPECIFIED  PURSUANT  TO  THE
 PROVISIONS  OF  SECTION  NINETY-EIGHT-A  OF  THE  STATE FINANCE LAW. THE
 AUTHORITY SHALL HAVE  POWER,  NOTWITHSTANDING  THE  PROVISIONS  OF  THIS
 SECTION,  TO  CONTRACT  WITH THE HOLDERS OF ANY BONDS AS TO THE CUSTODY,
 COLLECTION, SECURITY, INVESTMENT  AND  PAYMENT  OF  ANY  MONEYS  OF  THE
 AUTHORITY  OR  ANY  MONEYS HELD IN TRUST OR OTHERWISE FOR THE PAYMENT OF
 BONDS OR IN ANY WAY TO SECURE BONDS. MONEYS HELD IN TRUST  OR  OTHERWISE
 FOR  THE  PAYMENT OF BONDS OR IN ANY WAY TO SECURE BONDS AND DEPOSITS OF
 SUCH MONEYS MAY BE SECURED IN THE SAME MANNER AS MONEYS OF THE AUTHORITY
 AND ALL BANKS AND TRUST COMPANIES ARE AUTHORIZED TO GIVE  SUCH  SECURITY
 FOR SUCH DEPOSITS.
   §  1114-K.  BONDS; LEGAL INVESTMENTS FOR FIDUCIARIES. THE BONDS OF THE
 AUTHORITY ARE HEREBY MADE SECURITIES IN WHICH ALL PUBLIC  OFFICIALS  AND
 BODIES  OF THE STATE AND ALL MUNICIPALITIES, ALL INSURANCE COMPANIES AND
 ASSOCIATIONS AND OTHER PERSONS CARRYING ON AN  INSURANCE  BUSINESS,  ALL
 BANKS, BANKERS, TRUST COMPANIES, SAVINGS BANKS AND SAVINGS ASSOCIATIONS,
 INCLUDING  SAVINGS AND LOAN ASSOCIATIONS, INVESTMENT COMPANIES AND OTHER
 PERSONS CARRYING ON A BANKING BUSINESS, AND  ADMINISTRATORS,  GUARDIANS,
 EXECUTORS,  TRUSTEES AND OTHER FIDUCIARIES AND ALL OTHER PERSONS WHATSO-
 EVER, WHO ARE NOW OR MAY HEREAFTER BE AUTHORIZED TO INVEST IN  BONDS  OR
 OTHER  OBLIGATIONS  OF  THE STATE, MAY PROPERLY AND LEGALLY INVEST FUNDS
 INCLUDING CAPITAL IN THEIR CONTROL OR BELONGING TO THEM. THE  BONDS  ARE
 ALSO  HEREBY  MADE  SECURITIES  WHICH  MAY  BE DEPOSITED WITH AND MAY BE
 RECEIVED BY ALL PUBLIC OFFICERS AND BODIES OF THE STATE AND ALL  MUNICI-
 PALITIES  FOR ANY PURPOSES FOR WHICH THE DEPOSIT OF BONDS OR OTHER OBLI-
 GATIONS OF THE STATE IS NOW OR HEREAFTER MAY BE AUTHORIZED.

 A. 1204                            18
 
   § 1114-L. AGREEMENT WITH THE STATE. THE STATE DOES  HEREBY  PLEDGE  TO
 AND AGREE WITH THE HOLDERS OF ANY BONDS ISSUED BY THE AUTHORITY PURSUANT
 TO  THIS  TITLE THAT THE STATE WILL NOT ALTER OR LIMIT THE RIGHTS HEREBY
 VESTED IN THE AUTHORITY TO FULFILL THE TERMS OF ANY AGREEMENT MADE  WITH
 OR  FOR  THE  BENEFIT  OF  THE HOLDERS OF BONDS OR IN ANY WAY IMPAIR THE
 RIGHTS AND REMEDIES OF BONDHOLDERS UNTIL THE  BONDS  TOGETHER  WITH  THE
 INTEREST  THEREON, WITH INTEREST ON ANY UNPAID INSTALLMENTS OF INTEREST,
 AND ALL COSTS AND EXPENSES IN CONNECTION WITH ANY ACTION  OR  PROCEEDING
 BY  OR  ON  BEHALF  OF  SUCH  HOLDERS, ARE FULLY MET AND DISCHARGED. THE
 AUTHORITY IS AUTHORIZED TO INCLUDE THIS  PLEDGE  AND  AGREEMENT  OF  THE
 STATE IN ANY AGREEMENT WITH BONDHOLDERS.
   § 1114-M. EXEMPTION FROM TAXES, ASSESSMENTS AND CERTAIN FEES; PAYMENTS
 IN  LIEU  OF  TAXES. 1. IT IS HEREBY DETERMINED THAT THE CREATION OF THE
 AUTHORITY AND THE CARRYING OUT OF  ITS  CORPORATE  PURPOSES  IS  IN  ALL
 RESPECTS  FOR  THE  BENEFIT  OF  THE PEOPLE OF THE STATE AND IS A PUBLIC
 PURPOSE, AND THE AUTHORITY SHALL BE REGARDED  AS  PERFORMING  A  GOVERN-
 MENTAL  FUNCTION IN THE EXERCISE OF THE POWERS CONFERRED UPON IT BY THIS
 TITLE AND SHALL NOT BE REQUIRED TO PAY ANY  TAXES,  SPECIAL  AD  VALOREM
 LEVIES  OR SPECIAL ASSESSMENTS UPON ANY REAL PROPERTY OWNED BY IT OR ANY
 FILING, RECORDING OR TRANSFER FEES OR TAXES IN RELATION  TO  INSTRUMENTS
 FILED, RECORDED OR TRANSFERRED BY IT OR ON ITS BEHALF.
   2.  THE AUTHORITY MAY PAY, OR MAY ENTER INTO AGREEMENTS WITH ANY MUNI-
 CIPALITY TO PAY, A SUM OR SUMS ANNUALLY OR OTHERWISE OR TO PROVIDE OTHER
 CONSIDERATIONS TO SUCH MUNICIPALITY WITH RESPECT TO REAL PROPERTY  OWNED
 BY  THE  AUTHORITY  LOCATED  WITHIN SUCH MUNICIPALITY AND CONSTITUTING A
 PART OF ITS WATER SYSTEM.
   3. ANY BONDS ISSUED PURSUANT TO THIS TITLE TOGETHER  WITH  THE  INCOME
 THEREFROM  SHALL  BE EXEMPT FROM TAXATION EXCEPT FOR TRANSFER AND ESTATE
 TAXES. THE REVENUES, MONEYS AND ALL OTHER PROPERTY AND ALL ACTIVITIES OF
 THE AUTHORITY SHALL BE EXEMPT FROM ALL TAXES AND  GOVERNMENTAL  FEES  OR
 CHARGES,  WHETHER  IMPOSED  BY  THE STATE OR ANY MUNICIPALITY, INCLUDING
 WITHOUT LIMITATION REAL ESTATE TAXES,  INCOME  TAXES,  FRANCHISE  TAXES,
 SALES TAXES OR OTHER EXCISE TAXES.
   4.  THE STATE HEREBY COVENANTS WITH THE PURCHASERS AND WITH ALL SUBSE-
 QUENT HOLDERS AND TRANSFEREES OF BONDS ISSUED BY THE AUTHORITY  PURSUANT
 TO THIS TITLE, IN CONSIDERATION OF THE ACCEPTANCE OF AND PAYMENT FOR THE
 BONDS, THAT THE BONDS OF THE AUTHORITY ISSUED PURSUANT TO THIS TITLE AND
 THE  INCOME  THEREFROM  SHALL BE EXEMPT FROM SUCH TAXATION, AS STATED IN
 SUBDIVISION THREE OF THIS SECTION, AND THAT ALL  REVENUES,  MONEYS,  AND
 OTHER  PROPERTY PLEDGED TO SECURE THE PAYMENT OF SUCH BONDS SHALL AT ALL
 TIMES BE FREE FROM SUCH TAXES AS STATED IN SUCH SUBDIVISION.
   5. NOTWITHSTANDING THE PROVISIONS OF SUBDIVISIONS ONE THROUGH FOUR  OF
 THIS  SECTION,  NOTHING  HEREIN SHALL PREVENT THE STATE FROM ASSESSING A
 TAX OR SURCHARGE AGAINST  THE  WATER  CUSTOMERS  BASED  ON  THEIR  WATER
 CONSUMPTION,  PROVIDED,  HOWEVER, THAT ALL SUCH TAXES AND SURCHARGES AND
 THE AUTHORITY'S OBLIGATION TO COLLECT AND PAY SUCH TAXES AND  SURCHARGES
 SHALL  BE SUBORDINATE TO THE RIGHTS OF HOLDERS OF ALL OF THE AUTHORITY'S
 BONDS AND NOTES AND TO THE PAYMENT OF PRINCIPAL, PREMIUMS  IF  ANY,  AND
 INTEREST THEREON.
   §  1114-N.  ACTIONS  AGAINST THE AUTHORITY. 1. EXCEPT IN AN ACTION FOR
 WRONGFUL DEATH, NO ACTION OR PROCEEDING SHALL  BE  PROSECUTED  OR  MAIN-
 TAINED  AGAINST  THE  AUTHORITY FOR PERSONAL INJURY OR DAMAGE TO REAL OR
 PERSONAL PROPERTY ALLEGED TO HAVE BEEN SUSTAINED BY REASON OF THE NEGLI-
 GENCE OR WRONGFUL ACT OF THE AUTHORITY OR ANY MEMBER, OFFICER, AGENT  OR
 EMPLOYEE THEREOF, UNLESS:

 A. 1204                            19
 
   (A) A NOTICE OF CLAIM SHALL HAVE BEEN MADE AND SERVED UPON THE AUTHOR-
 ITY  WITHIN  THE TIME LIMIT BY AND IN COMPLIANCE WITH SECTION FIFTY-E OF
 THE GENERAL MUNICIPAL LAW;
   (B) IT SHALL APPEAR BY AND AS AN ALLEGATION IN THE COMPLAINT OR MOVING
 PAPERS  THAT AT LEAST THIRTY DAYS HAVE ELAPSED SINCE THE SERVICE OF SUCH
 NOTICE AND THAT ADJUSTMENT OR PAYMENT  THEREOF  HAS  BEEN  NEGLECTED  OR
 REFUSED;
   (C)  THE  ACTION  OR PROCEEDING SHALL BE COMMENCED WITHIN ONE YEAR AND
 NINETY DAYS AFTER THE HAPPENING OF THE EVENT UPON  WHICH  THE  CLAIM  IS
 BASED; AND
   (D)  AN  ACTION  AGAINST  THE  AUTHORITY  FOR  WRONGFUL DEATH SHALL BE
 COMMENCED IN ACCORDANCE WITH THE NOTICE OF  CLAIM  AND  TIME  LIMITATION
 PROVISIONS OF TITLE ELEVEN OF ARTICLE NINE OF THIS CHAPTER.
   2.  WHEREVER  A NOTICE OF CLAIM IS SERVED UPON THE AUTHORITY, IT SHALL
 HAVE THE RIGHT TO DEMAND AN EXAMINATION OF THE CLAIMANT RELATIVE TO  THE
 OCCURRENCE  AND  EXTENT  OF  THE  INJURIES OR DAMAGES FOR WHICH CLAIM IS
 MADE, IN ACCORDANCE WITH THE PROVISIONS OF SECTION FIFTY-H OF THE GENER-
 AL MUNICIPAL LAW.
   3. THE AUTHORITY MAY REQUIRE ANY PERSON PRESENTING FOR  SETTLEMENT  AN
 ACCOUNT  OR  CLAIM  FOR ANY CAUSE WHATSOEVER AGAINST THE AUTHORITY TO BE
 SWORN BEFORE A MEMBER, COUNSEL, OR  AN  ATTORNEY,  OFFICER  OR  EMPLOYEE
 THEREOF  DESIGNATED  FOR  SUCH PURPOSE, CONCERNING SUCH ACCOUNT OR CLAIM
 AND WHEN SO SWORN, TO ANSWER ORALLY AS TO ANY  FACTS  RELATIVE  TO  SUCH
 ACCOUNT OR CLAIM. THE AUTHORITY SHALL HAVE POWER TO SETTLE OR ADJUST ALL
 CLAIMS IN FAVOR OF OR AGAINST THE AUTHORITY.
   4. THE RATE OF INTEREST TO BE PAID BY THE AUTHORITY OR THE WATER BOARD
 UPON  ANY JUDGMENT FOR WHICH IT IS LIABLE, OTHER THAN A JUDGMENT AGAINST
 THE AUTHORITY ON ITS BONDS, SHALL NOT EXCEED THE  RATE  OF  INTEREST  ON
 JUDGMENTS  AND ACCRUED CLAIMS AGAINST MUNICIPAL CORPORATIONS AS PROVIDED
 IN THE GENERAL MUNICIPAL LAW FROM TIME TO TIME.  INTEREST ON PAYMENTS OF
 PRINCIPAL OR INTEREST ON ANY BONDS IN DEFAULT SHALL ACCRUE AT  THE  RATE
 BORNE  BY  SUCH  BONDS FROM THE DUE DATE THEREOF UNTIL PAID OR OTHERWISE
 SATISFIED.
   § 1114-O. CONFLICTS OF INTEREST OF MEMBERS OF THE BOARD  OF  DIRECTORS
 AND  OFFICERS  AND EMPLOYEES OF THE AUTHORITY. NO MEMBER OF THE BOARD OF
 DIRECTORS OR OFFICER OR EMPLOYEE OF THE AUTHORITY SHALL HAVE ANY  INTER-
 EST  IN ANY CONTRACT, OR TAKE ANY ACTION OR OTHERWISE INVOLVE HIMSELF OR
 HERSELF IN ANY ACTIVITY WHICH,  PURSUANT  TO  ARTICLE  EIGHTEEN  OF  THE
 GENERAL  MUNICIPAL  LAW,  WOULD  BE  DEEMED A CONFLICT OF INTEREST FOR A
 MUNICIPAL OFFICER OR EMPLOYEE HOLDING A  POSITION  WITH  A  MUNICIPALITY
 SIMILAR TO THE POSITION HELD BY THE MEMBER, OFFICER OR EMPLOYEE WITH THE
 AUTHORITY.
   § 1114-P. CONSTRUCTION AND PURCHASE CONTRACTS. THE AUTHORITY SHALL LET
 CONTRACTS FOR CONSTRUCTION OR PURCHASE OF SUPPLIES, MATERIALS, OR EQUIP-
 MENT PURSUANT TO SECTION ONE HUNDRED THREE OF THE GENERAL MUNICIPAL LAW.
 NOTHING  IN  THIS  SECTION  SHALL BE CONSTRUED TO LIMIT THE POWER OF THE
 AUTHORITY TO DO ANY CONSTRUCTION DIRECTLY BY THE  OFFICERS,  AGENTS  AND
 EMPLOYEES  OF  THE AUTHORITY OR TO CONTRACT WITH A PUBLIC UTILITY, FOR A
 TERM NOT TO EXCEED FIVE YEARS, FOR THE OPERATION AND  MAINTENANCE  OF  A
 WATER SUPPLY SYSTEM ACQUIRED FROM SAID PUBLIC UTILITY.
   §  1114-Q. SEPARABILITY CLAUSE. IF ANY SECTION, CLAUSE OR PROVISION IN
 THIS TITLE SHALL BE HELD BY A COMPETENT COURT TO BE UNCONSTITUTIONAL  OR
 INEFFECTIVE  IN WHOLE OR IN PART, TO THE EXTENT THAT IT IS NOT UNCONSTI-
 TUTIONAL OR INEFFECTIVE, IT SHALL BE VALID AND EFFECTIVE, AND  NO  OTHER
 SECTION,  CLAUSE OR PROVISION SHALL ON ACCOUNT THEREOF BE DEEMED INVALID
 OR INEFFECTIVE.

 A. 1204                            20
 
   § 1114-R. EFFECT OF INCONSISTENT PROVISIONS. INSOFAR AS THE PROVISIONS
 OF THIS TITLE ARE INCONSISTENT WITH THE PROVISIONS  OF  ANY  OTHER  LAW,
 GENERAL,  SPECIAL  OR LOCAL, OR OF ANY CHARTER OR ANY LOCAL ORDINANCE OR
 RESOLUTION OF ANY MUNICIPALITY, THE PROVISIONS OF THIS  TITLE  SHALL  BE
 CONTROLLING,  PROVIDED  THAT  NOTHING CONTAINED IN THIS SECTION SHALL BE
 HELD TO SUPPLEMENT OR OTHERWISE EXPAND  THE  POWERS  OR  DUTIES  OF  THE
 AUTHORITY  OTHERWISE  SET FORTH IN THIS TITLE. NOTHING CONTAINED IN THIS
 TITLE SHALL BE HELD TO ALTER OR ABRIDGE THE POWERS  AND  DUTIES  OF  THE
 DEPARTMENT OF ENVIRONMENTAL CONSERVATION OR THE DEPARTMENT OF HEALTH.
   § 1114-S. ACQUISITION BY EMINENT DOMAIN. NOTWITHSTANDING ANY PROVISION
 OF  THE  EMINENT DOMAIN PROCEDURE LAW TO THE CONTRARY, IN ANY PROCEEDING
 BROUGHT BY THE AUTHORITY PURSUANT TO SAID LAW, TITLE SHALL VEST  IN  THE
 AUTHORITY AND COMPENSATION SHALL BE PAID ONLY:
   1.  UPON  A  DECISION  BY  THE SUPREME COURT THAT COMPENSATION FOR THE
 PROPERTY SO CONDEMNED SHALL BE DETERMINED SOLELY BY THE INCOME  CAPITAL-
 IZATION  METHOD  OF VALUATION, BASED ON THE ACTUAL NET INCOME AS ALLOWED
 BY THE PUBLIC SERVICE COMMISSION, AND
   2. UPON SUCH COURT'S DETERMINATION OF THE AMOUNT OF SUCH COMPENSATION,
 BASED UPON THE INCOME CAPITALIZATION METHOD, ENTRY OF  THE  FINAL  JUDG-
 MENT,  THE  FILING OF THE FINAL DECREE, AND THE CONCLUSION OF ANY APPEAL
 OR EXPIRATION OF THE TIME TO FILE AN APPEAL RELATED TO THE  CONDEMNATION
 PROCEEDING.  SHOULD  ANY  COURT  DETERMINE THAT A METHOD OF COMPENSATION
 OTHER THAN THE INCOME CAPITALIZATION  METHOD  BE  UTILIZED,  OR  IF  THE
 PROPOSED AWARD IS MORE THAN THE RATE BASE OF THE ASSETS TAKEN IN CONDEM-
 NATION AS UTILIZED BY THE PUBLIC SERVICE COMMISSION IN SETTING RATES AND
 AS  CERTIFIED  BY THE PUBLIC SERVICE COMMISSION, THE AUTHORITY MAY WITH-
 DRAW THE CONDEMNATION PROCEEDING  WITHOUT  PREJUDICE  OR  COSTS  TO  ANY
 PARTY.
   §  3.  This  act shall take effect on the ninetieth day after it shall
 have become a law.