1. Land acquisition projects for source water protection may be undertaken pursuant to the provisions of this article and other applicable provisions of law only with the approval of the commissioner.

2. The commissioner shall review such project application and may approve, disapprove or recommend modifications thereto consistent with applicable law, criteria, standards or rules and regulations relative to such projects. In reviewing applications for projects pursuant to this section, the commissioner shall give due consideration to:

a. the project's contribution to the protection of drinking water supplies;

b. the presence of a water plan, including a source water assessment/protection plan or other similar plan which identifies measures to reduce threats to drinking water sources and priorities for land acquisition projects; and,

c. financial need or hardship.

3. All land acquisition projects shall be undertaken in the state of New York. The total amount of the state assistance payments toward the cost of any such project shall be set forth in any request for proposal issued to solicit projects and will in no event exceed seventy-five percent of the cost.

For the purpose of determining the amount of the state assistance payments, the cost of the project shall not be more than the amount set forth in the application for state assistance payments approved by the commissioner. The state assistance payments toward the cost of a project shall be paid on audit and warrant of the state comptroller on a certificate of availability of the director of the budget.

4. a. The commissioner and a municipality may enter into a contract for the undertaking by the municipality of a source water protection project. Such project shall be recommended to the commissioner by the governing body of the municipality and, when approved by the commissioner, may be undertaken by the municipality pursuant to this title and any other applicable provision of law.

b. The commissioner and a not-for-profit corporation may enter into a contract for the undertaking by the not-for-profit corporation of a source water protection project. Such a project shall be recommended to the commissioner by the governing body of a not-for-profit corporation which demonstrates to the satisfaction of the commissioner that it is capable of operating and maintaining such property for the benefit of drinking water and/or water quality protection. Upon approval by the commissioner, such project may be undertaken pursuant to the provisions of this title and any other applicable provision of law.

5. No monies shall be expended for source water protection land acquisition projects except pursuant to an appropriation therefor.