(2) For the purposes of this subdivision sixteen-b the term "water facilities" shall mean the acquisition, construction or reconstruction of or addition to a water supply or distribution system, whether or not including buildings, land or rights in land, original furnishings, equipment, machinery or apparatus, or the replacement of such equipment, machinery or apparatus, which water facilities are to be financed and owned by the county. For the purpose of this subdivision sixteen-b the term "water properties" means the source of water supply and the water supply and distribution system of the authority, including the plants, works, instrumentalities or parts thereof and appurtenances thereto, lands, easements, rights in land and water rights, rights of way, contract rights, franchises, approaches, connections, dams, reservoirs, water mains and pipe lines, pumping stations and equipment, and any other property, real, personal or mixed, incidental to and included in such source of supply and such system or parts thereof, and any improvements, extensions and betterments, now or hereafter constructed, acquired or made by the authority, other than the water facilities constructed by the authority but financed and owned by the county in accordance with the provisions of this subdivision.

(3) The county may, by resolution of the legislative body of such county, enter into an agreement or agreements with the authority providing: (i) that water facilities shall be constructed by the authority, which water facilities shall be financed and owned by the county and leased or otherwise made available for the use of the authority; and (ii) for the transfer to the authority for use in the execution of its corporate purposes of such water facilities hereafter financed and owned by the county in accordance with the provisions of this subdivision; provided, however, that title to such facilities shall remain in the county. Such agreement shall constitute a contract for the passing to and vesting in the county of all rights and properties, including water properties, of the authority when all liabilities of the authority, other than its liabilities to the county pursuant to any agreements entered into pursuant to this subdivision, and the bonds of the authority have been paid in full or such liabilities or bonds have otherwise been discharged. Such agreement or agreements may be amended, modified, changed or extended by supplemental agreements authorized and executed in the same manner as the original agreement provided that the provisions of any such supplemental agreement shall not be inconsistent with the provisions of this subdivision sixteen-b.

(4) Such agreement shall provide that until the rights and properties, including the water properties, of the authority shall pass to and be vested in the county as provided by law, the authority shall act as the agent of the county: (i) to provide water facilities deemed necessary by the authority (a) to provide a supply of water sufficient to serve all customers of the water properties of the authority and of the water facilities of the county operated and managed by the authority, or (b) water facilities for the distribution of water deemed necessary by the authority to serve the territory of the authority within the county; and (ii) to operate, manage, replace, maintain and repair such water facilities in conjunction with the water properties of the authority so that both the water properties of the authority and the water facilities owned and financed by the county shall be planned, operated and managed as an integrated water system.

(5) Such agreement shall provide for the transfer to and use by the authority of such water facilities by lease, license or other arrangement until such time as all rights and properties, including water properties, of the authority shall pass to and be vested in the county as provided by law and shall authorize the authority to take jurisdiction, control, possession and supervision of such water facilities and operate, manage, replace, maintain and repair the same together with the water properties of the authority as an integrated water system.

(6) Such agreement shall provide that the county shall pay an amount not to exceed twenty-seven million dollars to provide certain water facilities to be owned by the county and leased to or otherwise made available for use by the authority in accordance with the provisions of such agreement, which water facilities shall be described in terms sufficient for identification in the first agreement so executed by and between the county and the authority. The county may issue obligations pursuant to the local finance law in an amount not to exceed twenty-seven million dollars to pay the cost of such water facilities. The provisions of section four hundred of the county charter prohibiting the financing of permanent improvements by the issuance of obligations pursuant to the local finance law unless such permanent improvements are included in a budget of permanent improvements adopted and approved as provided by such section four hundred shall not be applicable to the financing of such water facilities by the issuance of such obligations of the county authority by this paragraph.

(7) Such agreement shall provide that the authority shall pay to the county for each fiscal year of the county an annual rental for the use of the water facilities financed and owned by the county which shall be an operating expense of the authority, and shall be equal to the sum of the following: (i) the principal of any bonds of the county becoming due in such fiscal year issued in accordance with any agreement entered into pursuant to this subdivision; and (ii) the interest on any obligations of the county, including bonds and notes, issued in accordance with any such agreement and becoming due in such fiscal year. Such agreement shall provide such further details as the parties deem necessary with respect to the time and manner of the payment of such annual rentals in order to assure that such annual rentals shall be available to the the county at the times and in the amounts required for the payment of such principal of bonds of the county and such interest on obligations of the county. Notwithstanding that the payment of such annual rentals shall be an operating expense of the authority, such agreement may provide that payment thereof shall be subordinate to all or any of certain payments hereinafter described required to be made by a certain trust indenture between the authority and a trustee dated as of February first, nineteen hundred fifty-nine. Such payments are the payments required to be made by said trust indenture to the debt service fund and the debt service reserve fund both created by such indenture.

(8) Such agreement shall provide that to facilitate the further acquisition, construction, reconstruction, extension or betterment of water facilities by the authority to be owned and financed by the county, other than and in addition to the water facilities to be financed by the county pursuant to the provisions of paragraph (6) of this subdivision, the authority, on or before September first in each year or on or before such earlier date in each year as such agreement may provide, may submit to the county manager a capital budget for the calendar year beginning on the succeeding January first of such proposed water facilities and the estimated cost thereof. Such capital budget shall be accompanied by a report of the consulting engineers retained by the authority pursuant to a certain trust indenture of the authority dated as of February one, nineteen hundred fifty-nine. Such report of the consulting engineers shall explain the need for or desirability of such proposed water facilities and shall state that the consulting engineers have approved the estimated cost thereof. Such capital budget of the authority and report of such consulting engineers shall describe such proposed water facilities in terms sufficient for identification. When received by the county manager, such capital budget of the authority and the report of the consulting engineers shall be used in the preparation of the budget of permanent public improvements of the county required to be prepared by section four hundred of the Monroe county charter in the same manner as if the providing of such additional water facilities originally were proposed by the county. The county shall pay the cost of any water facilities contained in a budget of permanent improvements after such budget has been adopted. At any time after the adoption of such budget of permanent improvements the county may finance any water facilities contained therein pursuant to the provisions of and in the manner provided by the local finance law. Notwithstanding any other provisions of this subdivision, in the event that any item for the providing of water facilities contained in the capital budget and report of the consulting engineers as submitted to the county manager shall not be made a part of the budget of permanent improvements of the county, the authority may, nevertheless, proceed to construct such proposed water facility as an addition to the water properties of the authority and finance the same by the issuance of obligations of the authority, subject, however, to: (i) the provisions of any resolutions or trust indentures heretofore or hereafter adopted or executed by the authority, as the case may be, with respect to the construction of water properties and the financing thereof by the authority; and (ii) the limitations, if any, on the issuance of bonds or obligations by the authority contained in any agreement executed pursuant to this subdivision sixteen-b.

(9) Such agreement may contain further provisions concerning the following, provided, however, that no provisions in any agreement or any supplemental agreement thereto shall require the authority to in any way impair the rights and remedies of the holders of obligations of the authority pursuant to any resolution or trust indenture of the authority heretofore adopted or executed authorizing or securing obligations of the authority: (i) further provisions relating to the annual rentals due by the authority to the county as provided in this subdivision; (ii) provisions that the rates, fees, rentals and other charges for the sale or distribution of water or for other services rendered by the water properties of the authority shall be in an amount sufficient to fully comply with any covenants with holders of obligations of the authority and in addition sufficient to pay the annual rentals payable by the authority to the county as provided in this subdivision and in any agreements or supplemental agreements executed in accordance with the provisions of this subdivision; (iii) provisions limiting the issuance of bonds or obligations by the authority; (iv) provisions limiting the power of the authority to sell or otherwise dispose of its water properties without the consent of the county; (v) providing that when the rights and properties of the authority shall pass to and be vested in the county as provided by law the authority shall act as the agent of the county to plan, construct, operate and manage the water properties and water facilities then vested in and owned by the county for such term and extensions of such term as may be provided by any such agreements; and (vi) such other provisions not inconsistent with the provisions of this subdivision sixteen-b as the parties shall deem necessary or desirable to implement the purpose and provisions of this subdivision sixteen-b.

(10) The proceeds of sale of obligations of the county issued pursuant to any agreement entered into pursuant to this subdivision shall be subject to the provisions of section one hundred sixty-five of the local finance law and shall be paid and disbursed by the director of finance of the county on requisition by the authority or such person or persons as the authority may authorize to make such requisitions without further audit; provided, however, that the director of finance of the county may require that such requisitions shall be accompanied by properly itemized and verified or certified bills for materials, supplies or services.

(11) All contracts for the purchase of supplies or equipment or the construction of water facilities entered into with respect to the providing of water facilities to be financed and owned by the county and constructed by the authority shall be subject to all provisions of law which the county of Monroe would be subject to in relation to advertising and awarding any such contracts for supplies, equipment or the construction of water facilities

(12) The provisions of this subdivision sixteen-b shall be independent and cumulative power for the authority and the county to enter into the agreements authorized hereby and shall not be construed with or be limited by any of the provisions of article five-a of the county law and of this article of the public authorities law. 17. To accept grants, loans or contributions from the United States, the state of New York, or any agency or instrumentality of either of them, or the county, or an individual, by bequest or otherwise, and to expend the proceeds for any purposes of the authority; 18. To do all things necessary or convenient to carry out the powers expressly given in this title. 19. To contract for the purposes of subdivision twenty-four of section ten of article two of the highway law. In exercising the powers granted by this title, the authority shall not sell water in any area which is served by a water system owned or operated by a municipality unless the governing board of such municipality shall adopt a resolution requesting the authority to sell water in such area.