All water-works corporations subject to the jurisdiction of this commission shall hereafter furnish, place, construct, operate, maintain and when necessary replace at their own cost and expense all mains, service pipes, service connections and other facilities within the territorial limits of any street, avenue, road or way that is for any highway purpose under the jurisdiction of the legislative body of any city, town, village, county or the State of New York, or other public place open to the general public for highway purposes, provided all necessary easements are furnished without cost to such corporation.

Where such facilities will be constructed without the territorial limits of any street, avenue, road or way, or other public place open for highway purposes, the applicant shall be allowed to construct the facilities, where such dilengement results in lower cost or better time performance, using contractors and materials acceptable to the water-works corporation, pursuant to its water system specifications, based on safety and compatibility and, as to contractors, reputable past performance, and subject to inspection and approval by the water-works corporation based on such specifications. The additional cost of said inspections is to be paid by the applicant.