§ 119. Guaranties. 1. The local governing body shall require the
posting of a performance bond for the completion of the construction of
the sewage-works system, and may require the posting of an additional
bond or other guaranty for the payment of labor and material furnished
in the course of such construction, and for the cost of retained
engineering services to the local governing body or sewer agency.

2. The local governing body shall require a reasonable guaranty from
the corporation that said corporation will continue to maintain and
operate the system for a period of at least five years, in the form of a
bond or other security acceptable to the local governing body in the
amount of the estimated cost of the operation and maintenance of the
sewage-works project, less the estimated revenues which are received
from properties served, and to be utilized to defray such operation and
maintenance costs, as reported by the licensed professional engineer or
consulting engineering firm to the local governing body. The local
governing body may, and on petition of the corporation shall, at any
time review the adequacy of such bond or other security, to ascertain
whether it should be modified on the basis of fiscal performance or
other conditions.

3. (a) In addition to the guaranty, the stock of the corporation shall
be placed in escrow and title thereto shall pass to the local governing
body in the event of failure to complete the construction thereof, or in
the event of abandonment or discontinuance of the maintenance and
operation of the system by the corporation.

(b) In the county of Suffolk said stock placed in escrow may pass,
with the consent of the local governing body and the board of
supervisors to a county sewer agency in the event of failure to complete
the construction of said sewer system, or in the event of abandonment or
discontinuance of the maintenance and operation of said system by the
corporation.

4. In the event of such abandonment or discontinuance of the
maintenance and operation of the system, the local governing body shall
have the right to continue the maintenance and operation of the system
at the established rates, with the costs assessed against the users, and
it may levy taxes, or sewer rents for such purposes in the same manner
as if such facilities were owned by a city, town or village, as the case
may be. The local governing body shall have such powers until such time
as another corporation or agency may undertake to maintain and operate
the sewer system, or until such time as it becomes a part of a municipal
or sewer district system.

5. In Suffolk county in the event of an abandonment or discontinuance
of the maintenance and operation of the sewer system, the county agency
shall have the right to undertake to maintain and operate such sewer
system, and it shall do so at the established rates, or such other rates
as it may deem necessary, with the costs, including delinquent accounts,
assessed against all of the users until such time as the sewer system is
included in a sewer district which shall maintain and operate the sewer
system.