N.Y. Gen. Mun. Law § 120-V
A public corporation or improvement district in this state may contract for the disposal of its sewage with a municipality, public corporation or improvement district located in another state upon such terms and conditions as may be agreed upon except that no condition shall be imposed whereby a public corporation or improvement district in this state shall be required to extend its sewer mains outside the state. The term "public corporation" as used in this section shall mean a public corporation as defined in section three of the general corporation law; provided, however, that for the purposes of this section there shall be included a corporation which, except for its location outside the state, would be a public corporation within such definition. Nothing herein shall be construed to alter or abridge the powers and duties of the state department of health concerning sewage disposal matters.
N.Y. Gen. Mun. Law § 120-V