§ 89-c. General powers of commission in respect to water supply. The
commission: 1. Shall have general supervision of all water-works
corporations, as hereinbefore defined, having authority under any
general or special law or under any charter or franchise to lay down,
construct or maintain pipes, conduits, ducts or other fixtures in, on or
under the streets, highways and public places of any municipality, for
the purpose of furnishing or distributing water for domestic, commercial
or public uses, and all water systems owned, leased or operated by any
such water-works corporation; provided, however, that nothing herein
contained shall be construed to delegate the general powers of the state
department of health or of the water power and control commission or any
of the powers and functions of either as provided by law, nor shall
anything herein contained be construed to impair nor to deprive such
department or commission of its powers and functions as now provided by
law.

2. Shall have power of its own motion to examine and investigate the
methods employed by water-works corporations in delivering and supplying
water and furnishing equipment, and shall have access through its
members or through an officer or employee specially authorized by it to
make such examinations and investigations to all parts of the systems
owned, used or operated for the distribution of water by any such
corporation.

3. Shall have power, in its discretion, to prescribe uniform methods
of keeping accounts, records and books to be observed by water-works
corporations. It may also, in its discretion, prescribe by order forms
of accounts, records and memoranda to be kept by such corporations.
Notice of alterations by the commission in the required method or form
of keeping a system of accounts shall be given to such corporations by
the commission at least six months before the same shall take effect.
Any other and additional forms of accounts, records and memoranda kept
by such corporations shall be subject to examination by the commission.

4. Shall have power to examine all water-works corporations and keep
informed as to the methods, practices, regulations and property employed
by them in the transaction of their business. Whenever the commission
shall be of the opinion, after a hearing had upon its own motion or upon
complaint, that the rates, charges or classifications or the acts or
regulations of any such corporation are unjust, unreasonable, unjustly
discriminatory, or unduly preferential, or in any wise in violation of
any provision of law, the commission shall determine and prescribe in
the manner provided by and subject to the provisions of section
eighty-nine-j of this chapter, the just and reasonable rates, charges
and classifications thereafter to be enforced for the service to be
rendered, notwithstanding that a different rate or charge has heretofore
been prescribed by general or special statute, contract, grant,
franchise, condition, consent or other agreement, and the just and
reasonable acts and regulations to be done and observed; and whenever
the commission shall be of opinion, after a hearing had upon its own
motion or upon complaint, that the property, equipment or appliances of
any such corporation are unsafe, inefficient or inadequate, the
commission shall determine and prescribe the safe, efficient and
adequate property, equipment and appliances thereafter to be used,
maintained and operated for the security and accommodation of the public
and in compliance with the provisions of law and of their franchises and
charters; provided, however, that in its determination and prescription
of safe, efficient and adequate property, equipment and appliances as
herein provided any such property, equipment and appliances theretofore
approved by the water power and control commission, or its predecessor,
shall be deemed to have been adequate, safe and efficient at the time of
such approval. Nothing herein contained shall be deemed to dispense with
any approval of work by the water power and control commission required
by the conservation law; and if such an approval pertains to work done
pursuant to such determination or prescription of the public service
commission, such approval shall be conclusive that the work was done in
compliance with such determination or prescription.

5. Shall have power to require every water-works corporation, and it
shall be the duty of every water-works corporation, as defined by this
chapter, to file with the commission an annual report, verified by the
oath of the president, vice-president, treasurer, secretary, manager, or
receiver, if any, or by the person required to file the same. The
verification shall be made by said official holding office at the time
of filing said report, and if not made upon the knowledge of the person
verifying the same, shall set forth the sources of his information and
the grounds of his belief as to any matters not stated to be verified
upon his knowledge. The report shall show in detail (a) the amount of
its authorized capital stock and the amount thereof issued and
outstanding; (b) the amount of its authorized bonded indebtedness and
the amount of its bonds and other forms of evidence of indebtedness
issued and outstanding; (c) its receipts and expenditures during the
preceding year; (d) the amount paid as dividends upon its stock and as
interest upon its bonds; (e) the names of its officers and the aggregate
amount paid as salaries to them and the amount paid as wages to its
employees; (f) the location of its plant or plants and system, with a
full description of its property and franchises, stating in detail how
each franchise stated to be owned was acquired; and (g) such other facts
pertinent to the operation and maintenance of the plants and system, and
the affairs of such person or corporation as may be required by the
commission. Such reports shall be in the form, cover the period, and be
filed at the time prescribed by the commission. The commission may, from
time to time, make changes and additions in such forms. When any such
report is defective or believed to be erroneous, the commission shall
notify the corporation making such report to amend the same within a
time prescribed by the commission. Any such corporation which shall
neglect to make any such report or which shall fail to correct any such
report within the time prescribed by the commission shall be liable to a
penalty of one hundred dollars and an additional penalty of one hundred
dollars for each day after the prescribed time for which it shall
neglect to file or correct the same, to be sued for in the name of the
people of the state of New York, if ordered by the commission. The
amount recovered in any such action to be paid to the commission shall
be paid into the state treasury and be credited to the general fund. The
commission, for cause shown, may extend the time prescribed and, by
compromise, may accept less than the amount of such a penalty, in
settlement thereof.

6. Shall have power, either through its members or inspectors or
employees duly authorized by it, to enter in or upon and to inspect the
property, buildings, plants, pump houses, ducts, conduits and offices of
any such water-works corporation.

7. Shall have power to examine the accounts, books, contracts,
records, documents and papers of any water-works corporation, and have
power, after a hearing, to prescribe by order the accounts in which
particular outlays and receipts shall be entered, charged or credited.
At any such hearing the burden of proof shall be on such corporation to
establish the correctness of the accounts in which such outlays and
receipts have been entered, and the commission may suspend a charge or
credit pending submission of proof by such corporation.

§ 8. Shall have power to compel, by subpoena duces tecum, the
production of any accounts, books, contracts, records, documents,
memoranda and papers. In lieu of requiring production of originals by
subpoena duces tecum the commission or any commissioner may require
sworn copies of any such books, records, contracts, documents and
papers, or any parts thereof, to be filed with it. The commission may
require of all such water-works corporations specific answers to
questions upon which the commission may need information, and may also
require such corporations to file periodic reports in the form, covering
the period and filed at the time prescribed by the commission. If such
corporation shall fail to make specific answer to any question or shall
fail to make a periodic report when required by the commission as herein
provided within the time and in the form prescribed by the commission
for the making and filing of any such report or answer, such corporation
shall forfeit to the state the sum of one hundred dollars for each and
every day it shall continue to be in default with respect to such report
or answer. Such forfeiture may be recovered in an action brought by the
commission in the name of the people of the state of New York. The
amount recovered in any such action, or paid to the commission, shall be
paid into the state treasury and be credited to the general fund. The
commission, for cause shown, may by compromise accept less than the
amount of such forfeiture, in settlement thereof.

9. Shall have power in all parts of the state, either as a commission
or through its members, or through an officer or employee specially
authorized to conduct an investigation or hearing, to subpoena
witnesses, take testimony and administer oaths to witnesses in any
proceeding or examination instituted before it, or conducted by it in
reference to any matter within its jurisdiction under this article.

10. (a) Shall have power to require every water-works corporation to
file with the commission and to print and keep open to public inspection
schedules showing all rates and charges made, established or enforced or
to be charged or enforced, all forms of contract or agreement and all
rules and regulations relating to rates, charges or service used or to
be used, and all general privileges and facilities granted or allowed by
such corporation; but this subdivision shall not apply to state,
municipal or federal contracts.

(b) No change shall be made in any rate or charge, or in any form of
contract or agreement or any rule or regulation relating to any rate,
charge or service, or in any general privilege or facility, which shall
have been filed by such a corporation, in compliance with an order of
the commission, except after thirty days' notice to the commission and
to each county, city, town and village served by such water-works
corporation which had filed with such corporation, within the prior
twelve months, a request for such notice and which shall be affected by
such change and publication of a notice to the public of such proposed
change once in each week for four successive weeks in a newspaper having
general circulation in the county or counties containing territory
affected by the proposed change, which notice shall plainly state the
changes proposed and when the change will go into effect. The commission
for good cause shown may, except in the case of major changes, allow
changes to take effect prior to the end of such thirty-day period and
without publication of notice to the public under such conditions as it
may prescribe. The commission may delegate to the secretary of the
commission its authority to approve a change to a schedule postponing
the effective date of such schedule previously filed with the commission
and to allow for good cause shown the postponement to take effect prior
to the end of such thirty-day period and without publication of notice
to the public.

(c) For the purpose of this subdivision, "major changes" shall mean an
increase in the rates and charges which would increase the aggregate
revenues of the applicant more than the greater of three hundred
thousand dollars or two and one-half percent, but shall not include
changes in rates, charges or rentals allowed to go into effect by the
commission or made by the utility pursuant to an order of the commission
after hearings held upon notice to the public.

(d) No such corporation shall charge, demand, collect or receive a
greater or less or different compensation for any service rendered or to
be rendered than the rates and charges specified in its schedule filed
and in effect; nor shall any such corporation refund or remit in any
manner or by any device any portion of the rates or charges so
specified, nor extend to any person any form of contract or agreement,
or any rule or regulation, or any privilege or facility, except such as
are regularly and uniformly extended to all persons under like
circumstances.

(e) The commission shall have power to prescribe the form of every
such schedule and from time to time prescribe by order such changes in
the form thereof as may be deemed wise. The commission shall also have
power to establish such rules and regulations to carry into effect this
subdivision as it may deem necessary, and to modify or amend such rules
or regulations from time to time.

(f) Whenever there shall be filed with the commission by any
water-works corporation any schedule stating a new rate or charge, or
any change in any form of contract or agreement or any rule or
regulation relating to any rate, charge or service, or in any general
privilege or facility, the commission may, at any time within sixty days
from the date when such schedule would or has become effective, either
upon complaint or upon its own initiative, and, if it so orders, without
answer or other formal pleading by the interested corporation, but upon
reasonable notice, hold a hearing concerning the propriety of a change
proposed by the filing. If such change is a major change, the commission
shall hold such a hearing. Pending such hearing and decision thereon,
the commission, upon filing with such schedule and delivering to the
corporation affected thereby a statement in writing of its reasons
therefor, may suspend the operation of such schedule, but not for a
longer period than one hundred and twenty days beyond the time when it
would otherwise go into effect. After a full hearing, whether completed
before or after the schedule goes into effect, the commission may make
such order in reference thereto as would be proper in a proceeding begun
after the rate, charge, form of contract or agreement, rule, regulation,
service, general privilege or facility had become effective. If any such
hearing cannot be concluded within the period of suspension as above
stated, the commission may extend the suspension for a further period
not exceeding six months.

(g) The commission may, as authorized by section eighty-nine-j of this
article, establish temporary rates or charges for any period of
suspension under this section.

(h) At any hearing involving a rate, the burden of proof to show that
the change or proposed change if proposed by the corporation, or that
the existing rate, if it is proposed to reduce the rate, is just and
reasonable shall be upon the corporation; and the commission may give to
the hearing and decision of such questions preference over all other
questions pending before it.

(i) The schedule, rates, charges, form of contract or agreement, rule,
regulation, service, general privilege or facility in force when the new
schedule, rate, charge, form of contract, rule, regulation, service,
general privilege or facility was filed shall continue in force during
the period of the suspension unless the commission shall establish a
temporary rate or charge as authorized by section eighty-nine-j of this
article.

11. In case any water-works corporation is engaged in carrying on any
business other than owning, operating or managing a water system, which
other business is not otherwise subject to the jurisdiction of the
commission, and is so conducted that its operations are to be
substantially kept separate and apart from the owning, operating,
managing or controlling of such water system, said corporation in
respect of such other business shall not be subject to any of the
provisions of this chapter and shall not be required to procure the
assent or authorization of the commission to any act in such other
business or to make any report in respect thereof. But this subdivision
shall not restrict or limit the powers of the commission in respect to
the owning, operating, managing or controlling by such corporation of
such water system, and said powers shall include also the right to
inquire as to, and prescribe the apportionment of, capitalization,
earnings, debts and expenses fairly and justly to be awarded to or borne
by the ownership, operation, management or control of such water system
as distinguished from such other business. In any such case, if the
owning, operating, managing or controlling of such water system by any
such corporation is wholly subsidiary and incidental to the other
business carried on by it and is inconsiderable in amount and not
general in its character, the commission may by general rules exempt
such corporation from making full reports and from keeping of accounts
as to such subsidiary and incidental business.

12. The commission shall have power to require each water-works
corporation to establish classifications of service based upon the
quantity used, the time when used, the purpose for which used, the
duration of use and upon any other reasonable consideration, and to
establish in connection therewith just and reasonable graduated rates
and charges; and it shall have power, either upon complaint or upon its
own motion, to require such changes in such classifications, rates and
charges as it shall determine to be just and reasonable.

13. The commission, of its own motion or upon complaint of any person
or corporation aggrieved, may investigate and determine whether the
property of any corporation or person actually used within the state in
the business of the distribution, sale or furnishing of water for
domestic, commercial or public uses, exclusive of property used solely
for or in connection with the business of bottling, or selling,
distributing or furnishing bottled water, is of a value exceeding ten
thousand dollars. Where such value is ten thousand dollars or less, the
commission may require such persons and corporations to file with the
commission simplified annual reports, in a form and containing such
matters as the commission shall prescribe, and may prescribe simplified
forms of accounts to be kept by them.

14. (a) Notwithstanding any other provision of law to the contrary,
whenever real property owned by a water-works corporation is exempted
from taxation pursuant to the provisions of section four hundred
eighty-five-d of the real property tax law the rate or charge imposed by
such corporation within the taxing jurisdiction providing for such
exemption shall be set by the commission so as to reflect fully the
reduction in cost of service resulting therefrom.

(b) Notwithstanding any other provision of law to the contrary,
whenever a water-works corporation is the recipient of operating
assistance provided by a city pursuant to the provisions of section
twenty-one-e of the general city law, the rate or charge imposed by such
corporation within such city shall be set by the commission so as to
reflect fully the revenues to such corporation resulting therefrom.

15. The commission shall provide for management and operations audits
of water-works corporations having annual gross revenues in excess of
ten million dollars. Such audits shall include, but not be limited to,
an investigation of the corporation's construction program planning in
relation to the needs of its customers for reliable service and an
evaluation of the efficiency of the company's operations. The commission
shall have discretion to have such audits performed by its staff, or by
independent auditors.

In every case in which the commission chooses to have the audit
provided for in this subdivision performed by independent auditors, it
shall have authority to select the auditors and to require the
corporation being audited to enter into a contract with the auditors
providing for their payment by such corporation. Such contract shall
provide further that the auditors shall work for and under the direction
of the commission according to such terms as the commission may
determine are necessary and reasonable.

The commission shall have authority to direct the corporation to
implement any recommendations resulting from such audits that it finds
to be necessary and reasonable.

Upon the application of a water-works corporation for a major change
in rates as defined in subdivision ten of this section, the commission
shall review the corporation's compliance with the directions and
recommendations made previously by the commission, as a result of the
most recently completed management and operations audit undertaken
pursuant to the provisions of this subdivision. The commission shall
incorporate the findings of such review in its opinion or order.

16. Notwithstanding any general or special law, rule or regulation,
the commission shall have the power to provide for the refund of any
revenues received by any water-works corporation which cause the
corporation to have revenues in the aggregate in excess of its
authorized rate of return for a period of twelve months. The commission
may initiate a proceeding with respect to such a refund after the
conclusion of any such twelve month period.

17. The commission shall have power to require each water-works
corporation to establish a process for residents of any cooperative,
condominium or multi-family dwelling with five or more residential
units, which uses a master meter to distribute water to such residents,
to obtain non-billing related information regarding the delivery of
water including but not limited to service updates, water quality
notices and other information deemed essential to water consumers.