N.Y. VIL Law § 2-258

§ 2-258 Apportionment of property and obligations of a special\ndistrict of a town upon the incorporation of a part in a village. If the\nterritory so incorporated as a village includes within its boundaries\npart of a special district established by the town for a sewer, water,\nlight, fire, park, health, police or any other special district for\nmunicipal purposes, the proportion of the bonded debt incurred by the\ntown and payable by a tax against the property within a special\ndistrict, for whose benefit the bonds were issued which shall be assumed\nby the village and the apportionment of personal and real property\nbelonging to the special district shall be determined according to the\nrelative assessed valuation of the personal and real property in that\nportion of the special district without the village and that portion\nwithin the village, in the following manner: the town board of the town\nwhen acting as a board for special district exclusive of a member who\nmay reside in the village or the commissioner or commissioners of a\nspecial district where the special district is managed by a commissioner\nor commissioners exclusive of a member who may reside in the village and\nthe trustees of the village being unable to agree within six months\nafter the incorporation of the village becomes complete upon the\nproportion of the debt and the apportionment of the personal and real\nproperty, then the supreme court shall have power to determine such\ndivision and to enforce such award, division and determination as shall\nbe made in the premises in a suit in equity to be brought in the name of\neither of the said parties.\n