Section 45. Extensions and additional lines

a.  Whenever the board of
  transportation shall determine that the public interests so require,  it
  may  with  the  approval of the board of estimate and the mayor, without
  advertising for proposals, but only after a public hearing under section
  thirty-four of this chapter, enter  into  a  contract  with  the  person
  owning,  operating or agreeing to operate, any existing railroad for the
  construction,  equipment,  maintenance  and  operation,   or   for   the
  equipment,  maintenance  and  operation  of  any  additional or proposed
  railroad to be owned  by  the  city  for  which  necessary  consents  as
  provided in section twenty-one of this chapter shall have been obtained,
  provided  that  such  proposed railroad shall be operated in conjunction
  with such existing railroad for a single fare.  Such  contract  for  the
  equipment, maintenance and operation of such road or any portion thereof
  may  be  made  and entered into before consents shall have been obtained
  therefor as provided in section twenty-one of this chapter. In such case
  such contract for equipment, maintenance and operation of such  road  or
  any portion thereof shall be upon condition that such contract shall not
  become  operative  or  go  into  effect  as to such road or such portion
  thereof unless and until the city shall acquire the right  to  construct
  such road or portion thereof by obtaining such consents.
    b.   Such   contract  for  construction,  equipment,  maintenance  and
  operation or for equipment, maintenance and operation  may  be  made  in
  either of the two following ways:
    1. If such existing railroad be wholly or in part within the limits of
  the city, such contract may be made under and pursuant to the provisions
  of  sections  thirty-one,  forty, and forty-two, so far as such sections
  shall be applicable, with the railroad corporation  owning  or  actually
  operating  or  agreeing  to operate such existing railroad, but the term
  for equipment, maintenance and  operation  of  such  proposed  road,  as
  specified  in such contract, pursuant to such sections, shall not be for
  a period longer than the unexpired term of the franchise or contract for
  the maintenance and operation of such existing railroad and any renewals
  provided for in such franchise or contract.
    2. If such existing railroad be a rapid transit  railroad  constructed
  wholly  or  in  part  at  the public expense under the provisions of the
  rapid transit act or this chapter and wholly or  in  part  in  operation
  such  contract  may  be made with the person having the contract for the
  construction and operation of such existing rapid  transit  railroad  by
  the  terms  of  which  such  proposed  rapid  transit  railroad  if  not
  constructed or to be constructed by the board  of  transportation  under
  separate construction contracts shall be constructed as extra work under
  the  terms  of such existing contract either without expense to the city
  or for such sum of money or such proportion of the actual  cost  thereof
  as  may  be  agreed  upon  to  be  paid  by  such city for or toward the
  construction thereof, the railroad when so completed as extra work to be
  subject to the terms and conditions of such original contract except  so
  far as shall be otherwise specified and agreed.
    c.  Every  such contract for such construction, equipment, maintenance
  and operation or for such equipment, maintenance and operation  of  such
  proposed  railroad made in either of the foregoing specified ways, shall
  also make provision that the city, upon giving a specified  notice,  may
  terminate  the  contract for equipment, maintenance and operation of any
  such proposed railroad as to all and  if  deemed  advisable  as  to  any
  specified  portion thereof at any time after the expiration of ten years
  from the date when operation of any part of such proposed railroad or of
  such specified portion thereof shall actually begin, but such  right  of
  termination of any such contract shall be upon condition as follows:

    1.  If  the title to the equipment of such proposed railroad shall not
  be vested in the city then that the equipment of the  proposed  railroad
  or  portion  thereof  suitable  to  and  used  for  the purposes of such
  railroad as apportioned pursuant to the contract, shall be purchased and
  taken by the city at an amount which shall be ascertained as provided in
  the  contract,  but  which  shall  not  be  greater than the actual cost
  thereof, plus fifteen per centum thereof, and such equipment, upon  such
  termination  of  such  contract, shall become and be the property of the
  city on paying to the contractor such amount. In case the title  to  the
  equipment  of  such  proposed  railroad shall be vested in the city then
  that the city shall pay to the contractor an amount for  his  investment
  in  the  equipment  of such proposed railroad, or portion thereof, which
  shall not exceed the actual cost to the contractor of equipment of  such
  railroad or portion, plus fifteen per centum thereof, and shall decrease
  under  provisions  of the contract as the term thereof continues so that
  at the end of the full term of the contract no such amount shall be paid
  except that if additional equipment shall be required and supplied after
  the railroad, or portion thereof, shall have been put in operation,  and
  if  the  contract  shall provide that title to such additional equipment
  shall vest in the city when supplied, then the city shall pay an  amount
  for  the investment of the contractor in such additional equipment which
  amount shall not exceed the  actual  cost  to  the  contractor  of  such
  additional  equipment  plus fifteen percentum thereof and shall diminish
  so that at the end of the full term of the contract the  city  shall  be
  required  to  pay  for such investment in additional equipment only such
  amount as shall be provided in such contract.
    2. Upon the further condition  if  such  proposed  railroad  shall  be
  constructed  wholly  or  in  part at the cost of the contractor that the
  city shall also pay to the contractor an amount for  his  investment  in
  the  construction  of such proposed road or portion thereof, which shall
  not exceed the actual cost to the contractor of constructing  such  road
  or  portion,  plus  fifteen per centum thereof, and shall decrease under
  provisions of the contract as the term thereof continues so that at  the
  end  of  the  full  term  of  the contract no such amount shall be paid,
  except that if betterments, additions or improvements shall be  required
  by  the  board  of transportation or approved by such board prior to the
  construction thereof and be constructed wholly or in part at the cost of
  the contractor,  then  that  the  city  shall  pay  an  amount  for  the
  investment   of   the  contractor  in  such  betterments,  additions  or
  improvements which shall not exceed the actual cost to the contractor of
  constructing such betterments, additions or  improvements  plus  fifteen
  per centum thereof and which amount shall diminish so that at the end of
  the full term of the contract the city shall be required to pay for such
  investment in betterments, additions or improvements only such amount as
  shall be provided in the contract.
    d.  The  contract shall provide a method of ascertaining the amount to
  be paid for such equipment and for the investment of the  contractor  in
  the construction of such proposed road upon a termination by the city of
  such contract and for the equipment of such proposed railroad at the end
  of  the  full  term  of  the  contract.  The  contract  may  provide for
  determining from time to time, in default of agreement,  by  arbitration
  or by the court, a valuation of such investment of the contractor in the
  construction  of  such proposed road and of the equipment or any part or
  portion of either thereof for  any  purpose  under  such  contract.  The
  contract  may provide that the title to the equipment as well as to such
  road shall vest in the city from the beginning and that the amount to be
  paid by the city for the investment of the contractor in such  equipment
  shall decrease as the terms of the contract continues so that at the end

  of  the  full  term  of the contract no amount shall be payable therefor
  except for additional equipment as aforesaid. The contract shall provide
  that upon the expiration of the term fixed in the contract, the contract
  shall  end  without compensation to the contractor except as provided in
  the contract, for betterments, additions or  improvements  to  any  such
  railroad  required to be made or approved by the board of transportation
  prior to the construction thereof during the term of any such  contract,
  and,  if  the  title  to  the  equipment  be not vested in the city, for
  equipment suitable to and used for the purposes of such contract to  the
  amount,  if  any,  ascertained  as provided in the contract, and that in
  such event such equipment shall become the property  of  the  city  upon
  payment  to  the  contractor  of  such  amount,  or, if the title to the
  equipment be vested in the city, then an amount for  the  investment  of
  the  contractor  in  additional  equipment  for  any such railroad to be
  ascertained as provided in the contract.
    e. The contract also may include a provision for modification  of  the
  lease  or  contract  for  equipment,  maintenance  and operation of such
  existing  railroad  so  that  such  latter  lease  or  contract  may  be
  terminated  by  the city upon giving a specified notice at the same time
  and in connection with the  termination  of  the  contract  as  to  such
  proposed railroad, but such right of termination of any such contract as
  to such existing railroad shall be upon condition:
    1.  That  the  equipment of such railroad suitable to and used for the
  purposes of such contract shall be purchased and taken by the city at an
  amount which shall be ascertained as provided in the contract, but shall
  not be greater than the actual cost  thereof  plus  fifteen  per  centum
  thereof,  and  such  equipment,  upon such termination of such contract,
  shall become and be the property of the city on paying to the contractor
  such amount, or
    2. Upon the further condition, if such existing  railroad  shall  have
  been  constructed  wholly or in part at the cost of the contractor, that
  the city also shall  pay  to  the  contractor  or  to  his  assignee  in
  possession  an  amount  for  the  investment in the construction of such
  existing road which shall not exceed the actual cost to  the  contractor
  of  constructing  such  road  plus fifteen per centum thereof, and shall
  decrease under the provisions  of  the  contract  as  the  term  thereof
  continues,  so  that at the end of the full term of the contract, and of
  any renewal thereof contained therein, no such amount shall be paid.
    The contract as so modified shall provide a method of ascertaining the
  amount to be paid for such equipment  and  for  the  investment  of  the
  contractor  in  the  construction of such road upon a termination by the
  city of such contract, and for the equipment of such  existing  railroad
  at  the  end  of  the  full  term  of  the contract. Such contract as so
  modified may provide for determining from time to time,  in  default  of
  agreement,  by  arbitration  or  by  the  court,  a  valuation  of  such
  investment of the contractor in the construction of such road and of the
  equipment, or any part or portion of either  thereof,  for  any  purpose
  under  such contract. The contract also may provide for assuring that in
  case a new contract for equipment, and for maintenance and operation  of
  such  existing  railroad,  or  proposed  railroad,  is  made  after such
  termination, pursuant to notice, or after the  expiration  of  the  full
  term of such contract, that the title to and possession of the equipment
  so  taken and the right to the possession of the railroad so constructed
  may be transferred directly to the new contractor upon  his  paying  the
  amount so required.