N.Y. Town Law § 64-ee: Peconic Bay region septic system replacement loan program

§ 64-ee. Peconic Bay region septic system replacement loan program. 1.

As used in this section, the following words and terms shall have the

following meanings:

(a) "Peconic Bay region" means the towns of East Hampton, Riverhead,

Shelter Island, Southampton and Southold.

(b) "Cesspool" means a drywell that receives untreated sanitary waste

containing human excreta, which sometimes has an open bottom and/or

perforated sides.

(c) "Septic system" means a system that provides for the treatment

and/or disposition of the combination of human and sanitary waste with

water not exceeding one thousand gallons per day, serving a single

parcel of land.

(d) "Septic system project" means the replacement of a cesspool with a

septic system, the installation, replacement or upgrade of a septic

system or septic system components, or installation of enhanced

treatment technologies, including an advanced nitrogen removal system,

to significantly and quantifiably reduce environmental and/or public

health impacts associated with effluent from a cesspool or septic system

to groundwater used as drinking water, or a threatened or an impaired

waterbody.

(e) "Fund" means the community preservation fund created pursuant to

subdivision two of section sixty-four-e of this article.

2. The town board of any town in the Peconic Bay region may, by local

law, establish a septic system replacement loan program using a portion

of the water quality improvement monies from the fund, pursuant to

paragraph (e) of subdivision three of section sixty-four-e of this

article.

3. Such program may make loans to the owners of real property located

within the town to finance the installation of septic system projects.

The town shall establish priority areas within the town, which would

receive water quality and public health benefits from the installation

of septic system projects, for such loans in order to maximize

environmental and public health benefits.

4. To be eligible for a loan pursuant to this section, the septic

system project shall be listed as an approved water quality improvement

project in the town's community preservation project plan pursuant to

subdivision six of section sixty-four-e of this article and be proposed

for real property located within an established priority area of the

town. Monies from the fund may only be loaned for projects which have

been included in such plan and shall not include costs associated with

routine maintenance such as a pump out of a septic tank.

5. A local law establishing the septic system replacement loan program

shall provide for the criteria for making such loans and the terms and

conditions for repayment of such loans provided that:

(a) For loans made to an owner of real property that is a commercial

entity, not-for-profit organization, or entity other than an individual,

the town board shall have the authority by local law to impose

requirements on the maximum amount that may be borrowed through such

loan, which may consider factors including but not limited to the

property value, expected environmental and water quality benefit and

existing indebtedness secured by such property.

(b) For loans made to an owner of real property who is an individual,

the principal amount of each such loan, excluding interest, shall not

exceed the lesser of ten percent of the appraised real property value or

the actual cost of the septic system project including the costs of

installation, necessary equipment, materials, and labor.

(c) No such loan shall be made unless such septic system project will

significantly and quantifiably reduce environmental and/or public health

impacts associated with effluent from a cesspool or septic system from

the proposed real property site to groundwater used as drinking water,

or a threatened or an impaired waterbody.

6. Every loan made under the septic system replacement loan program

shall be repaid over a term not to exceed ten years. The town shall set

a fixed rate of interest for the repayment of the principal amount of

each loan at the time the loan is made provided that no interest rate

shall exceed two and one-half percent and no applicant shall receive a

loan more than once in any five-year period.

7. The principal amount of each such loan, excluding interest, shall

not exceed the actual cost of installing the septic system project,

including the costs of necessary equipment, materials, and labor.

8. No such loan shall be made for a septic system replacement project

unless such system is approved by the Suffolk County Department of

Health Services.

9. The loan made under the septic system replacement loan program

shall constitute a lien upon the real property benefitted by such loan.

10. The town may require the loan made under the septic system loan

program to be repaid by the property owner through a charge on the real

property benefitted by such loan. Such charge shall be on the real

property and shall be levied and collected at the same time and in the

same manner as town taxes, provided that such charge shall be separately

listed on the tax bill, and provided further that in the event such

charge should not be paid in a timely manner, no other municipal

corporation shall be required to credit or otherwise guarantee the

amount of such unpaid charge to the municipal corporation which

authorized the loan, notwithstanding any provision of law to the

contrary.

11. All revenues received by the town from the repayment of loans

shall be deposited in the fund.