Opinion 91-51

This opinion represents the views of the Office of the State Comptroller at the time it was rendered. The opinion may no longer represent those views if, among other things, there have been subsequent court cases or statutory amendments that bear on the issues discussed in the opinion.

MUNICIPAL FUNDS -- Inter-fund Advance (from county sewer district fund to general fund)
COUNTIES -- Fund Transfers (inter-fund advance from sewer district fund to general fund)

GENERAL MUNICIPAL LAW, §§9-a, 453; COUNTY LAW, §271: A county may temporarily advance county sewer district user fees and benefit assessments to any other county fund in the manner prescribed by General Municipal Law, §9-a.

You ask whether a county chief fiscal officer may temporarily utilize for general county purposes moneys collected as user fees and benefit assessments on behalf of a county sewer district.

County sewer districts are governed generally by article 5-A of the County Law. The cost of establishing and maintaining the district may be financed by means of special ad valorem levies (County Law, §270) or on a benefit assessment basis (County Law, §271). The county also may establish user fees to finance some or all of the district's costs (General Municipal Law, article 14-F; County Law, §266; see 1989 Opns St Comp No. 89-59, p 131; 32 Opns St Comp, 1976, p 56; see also Industrial Refuse Systems v O'Rourke, 134 Misc 2d 45, 509 NYS2d 988, 994, mod on other grounds 131 AD2d 650, 516 NYS2d 903, mod on other grounds 129 AD2d 76, 516 NYS2d 940). You have confirmed that the county elected to finance the costs of this sewer district from a combination of benefit assessments and user fees imposed pursuant to article 14-F of the General Municipal Law (see County Law, §266[1][b]).

Costs of a county sewer district raised on a benefit basis are "assessed upon each ... parcel of land at the time and in the manner ..." provided for the levy of county taxes (County Law, §271[1]). Section 271 further provides as follows:

Such sums so levied shall be collected by the local tax collectors or receivers of taxes and assessments and shall be paid over to the county treasurer, or comparable officer or body, in the same manner and at the same time as taxes levied for general county purposes. The county treasurer, or comparable officer or body, shall keep a separate account of such moneys and they shall be used only for purposes of the county district for which collected. (id.; emphasis added).

Thus, upon receipt of sewer district benefit assessments, the county chief fiscal officer must credit the sewer district fund with those receipts, and those moneys may be used only for such county district purposes.

Under article 14-F of the General Municipal Law, a county on behalf of a sewer district may establish and impose sewer rents by local law (§452[1],[2]). Among other things, such local law "[s]hall provide for the date or dates on which sewer rents shall become due and payable" (§452[5][c]). Monies collected as sewer rents must be credited to a special fund, known as the "sewer rent fund", and must be used for those purposes set forth in General Municipal Law, §453, including for costs of operation, maintenance and repairs of the sewer system, payment of principal and interest of indebtedness incurred on behalf of the system, and for costs of certain capital improvements to the system.

As to whether a county may temporarily use sewer district user fees and assessments for general county purposes, General Municipal Law, §9-a, with certain exceptions, authorizes a municipal corporation to temporarily advance "moneys" held in a "fund" and not immediately required for the purpose for which they were raised or received, to any other fund of the municipal corporation. The definition of "moneys" in section 9-a(1)(b) excludes the proceeds from the sale of obligations and other moneys "which, by law, may be used only for stated purposes". This limitation clearly applies to moneys, such as moneys in a capital reserve fund, which are required by law to be kept in a separate account not to be co-mingled with other moneys of the municipal corporation (see, e.g., General Municipal Law, §6-c[7]). The limitation could be interpreted to encompass benefit assessments and user charges imposed on behalf of a county sewer district since the use of those moneys is limited to those purposes set forth in County Law, §271[1] and General Municipal Law, §453, cited above. Section 9-a(1)(a) also, however, defines "fund" to specifically include "funds established for special improvement districts ...". Given the general rule of statutory construction that all parts of a statute should be harmonized (McKinney's Statutes, §98), it is our opinion that the language of limitation in the definition of "moneys" was not intended to refer to moneys in "funds" established on behalf of special districts, such as those in question.

Thus, it is our opinion that a county may temporarily advance county sewer district user fees and benefit assessments to any other county fund in the manner prescribed by section 9-a. Section 9-a provides that an advance is made "in the same manner as prescribed by general, special or local law for making budgetary transfers between appropriations" (General Municipal Law, §9-a[2]). Thus, except where a duly adopted charter provision provides otherwise, an inter-fund advance in a county would be made by the chief fiscal officer pursuant to resolution adopted by the county governing board (see County Law, §§363-366; cf. Coyne v Stack, 63 AD2d 782, 404 NYS2d 908, involving county charter provisions governing budgetary transfers between appropriations). Moneys advanced pursuant to General Municipal Law, §9-a must be repaid no later than the close of the fiscal year in which the advance was made. Further, where the tax bases of the "lending" fund and the "borrowing" fund are different, such as in the instant situation, the repayment must include "an amount reasonably estimated to be the additional amount that would have been earned on the investment of moneys in the fund making the advance had the advance not been made" (id., §9-a[3]).

November 26, 1991
Ronald C. Delo, Executive Director
Rockland County Sewer District No. 1