N.Y. Transp. Corp. Law § 42
Such corporation shall supply each city, town or village through which the conduits or mains of such corporation may pass, or wherein such corporation may have organized, and the inhabitants thereof, with pure and wholesome water, at reasonable rates. The board of trustees of any incorporated village and the water commissioners or other board or officials performing the duties of water commissioners and having charge of the water supply of any city, shall have the power to contract in the name and behalf of the municipal corporation for the term of one year or more for the delivery by such corporation to the village or city of water, through hydrants or otherwise, for the extinguishment of fires and for sanitary and other public purposes. The amount agreed to be paid shall be annually raised as a part of the expenses of such village or city, and shall be assessed, levied and collected in the same manner as other expenses, and when collected shall be kept as a separate fund, and paid according to the terms and conditions of such contract. No such contract shall be made for a longer period than ten years nor for an annual amount exceeding in the aggregate two and one-half mills for every dollar of the taxable property of such village or city, except (a) upon the petition of a majority of the taxable inhabitants of any such village or city, or of the portion thereof to be supplied, or (b) upon a proposition to authorize the same submitted to a vote of the electors of the village or city, in the manner provided by the village law or city charter, and approved by a majority of the voters entitled to vote and voting thereon at an annual election or a special election duly called. Such contract shall be for a term not exceeding twenty years.
N.Y. Transp. Corp. Law § 42