STATE OF NEW YORK
Cal. No. 1603
April 23, 2018
Introduced by Sen. LAVALLE -- read twice and ordered printed, and when
printed to be committed to the Committee on Local Government --
committee discharged and said bill committed to the Committee on Rules
-- reported favorably from said committee, ordered to a third reading,
passed by Senate and delivered to the Assembly, recalled, vote recon-
sidered, restored to third reading, amended and ordered reprinted,
retaining its place in the order of third reading
AN ACT to amend the town law, in relation to authorizing towns in the
Peconic Bay region to establish septic system replacement loan
The People of the State of New York, represented in Senate and Assem-
bly, do enact as follows:
1 Section 1. Paragraph (e) of subdivision 1 of section 64-e of the town
2 law, as added by chapter 551 of the laws of 2015, is amended to read as
4 (e) "Water quality improvement project" means: (1) wastewater treat-
5 ment improvement projects; (2) non-point source abatement and control
6 program projects developed pursuant to section eleven-b of the soil and
7 water conservation districts law, title 14 of article 17 of the environ-
8 mental conservation law, section 1455b of the federal coastal zone
9 management act, or article forty-two of the executive law; (3) aquatic
10 habitat restoration projects; (4) pollution prevention projects[
11 (5) the operation of the Peconic Bay National Estuary Program, as desig-
12 nated by the United States Environmental Protection Agency; and (6) a
13 septic system replacement loan program, pursuant to section sixty-four-
14 ee of the town law. Such projects shall have as their purpose the
15 improvement of existing water quality to meet existing specific water
16 quality standards. Projects which have as a purpose to permit or accom-
17 modate new growth shall not be included within this definition.
18 § 2. The town law is amended by adding a new section 64-ee to read as
20 § 64-ee. Peconic Bay region septic system replacement loan program. 1.
21 As used in this section, the following words and terms shall have the
22 following meanings:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
S. 8254--A 2
1 (a) "Peconic Bay region" means the towns of East Hampton, Riverhead,
2 Shelter Island, Southampton and Southold.
3 (b) "Cesspool" means a drywell that receives untreated sanitary waste
4 containing human excreta, which sometimes has an open bottom and/or
5 perforated sides.
6 (c) "Septic system" means a system that provides for the treatment
7 and/or disposition of the combination of human and sanitary waste with
8 water not exceeding one thousand gallons per day, serving a single
9 parcel of land.
10 (d) "Septic system project" means the replacement of a cesspool with a
11 septic system, the installation, replacement or upgrade of a septic
12 system or septic system components, or installation of enhanced treat-
13 ment technologies, including an advanced nitrogen removal system, to
14 significantly and quantifiably reduce environmental and/or public health
15 impacts associated with effluent from a cesspool or septic system to
16 groundwater used as drinking water, or a threatened or an impaired
18 (e) "Fund" means the community preservation fund created pursuant to
19 subdivision two of section sixty-four-e of this article.
20 2. The town board of any town in the Peconic Bay region may, by local
21 law, establish a septic system replacement loan program using a portion
22 of the water quality improvement monies from the fund, pursuant to para-
23 graph (e) of subdivision three of section sixty-four-e of this article.
24 3. Such program may make loans to the owners of real property located
25 within the town to finance the installation of septic system projects.
26 The town shall establish priority areas within the town, which would
27 receive water quality and public health benefits from the installation
28 of septic system projects, for such loans in order to maximize environ-
29 mental and public health benefits.
30 4. To be eligible for a loan pursuant to this section, the septic
31 system project shall be listed as an approved water quality improvement
32 project in the town's community preservation project plan pursuant to
33 subdivision six of section sixty-four-e of this article and be proposed
34 for real property located within an established priority area of the
35 town. Monies from the fund may only be loaned for projects which have
36 been included in such plan and shall not include costs associated with
37 routine maintenance such as a pump out of a septic tank.
38 5. A local law establishing the septic system replacement loan program
39 shall provide for the criteria for making such loans and the terms and
40 conditions for repayment of such loans provided that:
41 (a) For loans made to an owner of real property that is a commercial
42 entity, not-for-profit organization, or entity other than an individual,
43 the town board shall have the authority by local law to impose require-
44 ments on the maximum amount that may be borrowed through such loan,
45 which may consider factors including but not limited to the property
46 value, expected environmental and water quality benefit and existing
47 indebtedness secured by such property.
48 (b) For loans made to an owner of real property who is an individual,
49 the principal amount of each such loan, excluding interest, shall not
50 exceed the lesser of ten percent of the appraised real property value or
51 the actual cost of the septic system project including the costs of
52 installation, necessary equipment, materials, and labor.
53 (c) No such loan shall be made unless such septic system project will
54 significantly and quantifiably reduce environmental and/or public health
55 impacts associated with effluent from a cesspool or septic system from
S. 8254--A 3
1 the proposed real property site to groundwater used as drinking water,
2 or a threatened or an impaired waterbody.
3 6. Every loan made under the septic system replacement loan program
4 shall be repaid over a term not to exceed ten years. The town shall set
5 a fixed rate of interest for the repayment of the principal amount of
6 each loan at the time the loan is made provided that no interest rate
7 shall exceed two and one-half percent and no applicant shall receive a
8 loan more than once in any five-year period.
9 7. The principal amount of each such loan, excluding interest, shall
10 not exceed the actual cost of installing the septic system project,
11 including the costs of necessary equipment, materials, and labor.
12 8. No such loan shall be made for a septic system replacement project
13 unless such system is approved by the Suffolk County Department of
14 Health Services.
15 9. The loan made under the septic system replacement loan program
16 shall constitute a lien upon the real property benefitted by such loan.
17 10. The town may require the loan made under the septic system loan
18 program to be repaid by the property owner through a charge on the real
19 property benefitted by such loan. Such charge shall be on the real prop-
20 erty and shall be levied and collected at the same time and in the same
21 manner as town taxes, provided that such charge shall be separately
22 listed on the tax bill, and provided further that in the event such
23 charge should not be paid in a timely manner, no other municipal corpo-
24 ration shall be required to credit or otherwise guarantee the amount of
25 such unpaid charge to the municipal corporation which authorized the
26 loan, notwithstanding any provision of law to the contrary.
27 11. All revenues received by the town from the repayment of loans
28 shall be deposited in the fund.
29 § 3. Severability. The provisions of this act shall be severable and
30 if any portion thereof or the applicability thereof to any person or
31 circumstances shall be held invalid, the remainder of this act and the
32 application thereof shall not be affected thereby.
33 § 4. This act shall take effect immediately.