Section 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.