(1) Projects upon county roads, town highways or village streets which are not situate on the route of an unimproved state highway shall become the responsibility of the town, county or village, as the case may be, and upon the completion and acceptance of any such project, all rights and duties of the state specially existing with respect thereto during the course of the project shall terminate.

(2) Projects upon county roads, town highways or village streets which are situate on the route of an unimproved state highway shall nevertheless, upon such completion and acceptance, become a town, county or village responsibility in the manner provided in paragraph (1), above, if the commissioner of transportation, in his discretion, shall so elect, such election to be manifested by his request for subsequent-maintenance assurances from the town, county or village, as the case may be.

(3) In cases falling under paragraphs (1) and (2), above, necessary acquisitions of lands or rights and interests therein, for right of way and other purposes when not acquired in connection with a federal aid program by the commissioner of transportation pursuant to subdivision thirty-four-a of section ten and sections thirty and eighty of this chapter and the eminent domain procedure law, shall be subject to the provisions of section one hundred eighteen of this chapter and the provisions of section thirty of this chapter shall, in such event, be inoperative except that the state, in connection with all such acquisitions of lands or rights and interests therein, shall pay to the person or other entity entitled thereto the amounts specified in subdivisions ten and twelve of section thirty of this chapter and section seven hundred two of the eminent domain procedure law and perform the functions incidental thereto in the same manner as if such acquisition had been made by the commissioner of transportation for state highway purposes pursuant to section thirty of this chapter. In connection with all such acquisitions of lands or rights and interests therein by a county, such county shall provide in its acquisition program that (a) every reasonable effort shall be made by the acquiring agency to acquire the requisite lands or rights and interests therein by negotiation, (b) to the greatest extent practicable no person lawfully occupying the land shall be required to move from his home, farm or business location without at least ninety days written notice from the acquiring agency, and (c) it will be the policy of the acquiring agency, before initiating negotiations for the lands, rights and interests therein, to establish the amount which is believed to constitute just compensation under the laws of this state and to make a prompt offer to acquire the lands, rights and interests therein for the full amount so established.