N.Y. Comp. Codes R. & Regs. tit. 14, § 521.9 – Local governmental unit approval of the project.

(a) The applicant must procure written approval of the project from the local governmental unit or appeal the withholding of that approval to the OMH.
1. (1) Certification, in the case of an application for a Housing Finance Agency or Facilities Development Corporation mortgage loan, that the project is consistent with its plan for the provision of services for the mentally disabled; and/or
2. (2) Written agreement, in the case of application for a State aid grant, unless the applicant is a local government.
(b)
(c) If the proposal is not approved, the applicant may appeal the local governmental unit's decision to the commissioner, unless the application involves the direct expenditure of local tax levy funds.
1. (1) The appeal must be made within 30 days from the date that the applicant has been notified of the refusal to approve or certify. In the absence of such notification, the appeal may be made 30 days after the submission of the proposal to the local governmental unit.
2. (2) The appeal must be in writing with a copy sent by certified mail, return receipt requested, to the local governmental unit and the Office of Mental Health.
3. (3) The written appeal must include:
  1. (i) a statement regarding any changes to the proposal since approval of the certificate of need;
  2. (ii) a statement of facts demonstrating that the applicant has submitted the proposal to the local governmental unit; that the local governmental unit has refused to approve, or has not responded; and, that the specified interval has transpired since that proposal was submitted to the local governmental unit; and
  3. (iii) copies of relevant documents including the submitted proposal and the decision of the local governmental unit.
(d) The local governmental unit shall have 30 days after receipt of the applicant's request for an appeal to reply to the Office of Mental Health, in writing, with a copy forwarded by certified mail, return receipt requested, to the applicant. Such reply shall set forth the basis for the decision not to approve or certify.
(e) Thirty days after the expiration of the time to reply, the commissioner or his designee, shall:
1. (1) attempt to informally conciliate the applicant and the local governmental unit; then,
2. (2) dismiss the appeal if the appeal is without merit; or
3. (3) schedule a hearing, if a substantial basis for appeal has been presented by the applicant, and the efforts of conciliation have failed.
(f) The commissioner, or a hearing officer appointed by the commissioner, shall conduct the hearing.
1. (1) Notice of the hearing shall be given to the applicant, the local governmental unit, and such other persons as the commissioner may deem advisable.
2. (2) The applicant, the representatives of the local governmental unit, appropriate representatives of the Office of Mental Health and other interested individuals may present their views to the commissioner on the merits of the appeal. The hearing shall not be adjudicatory in nature and the rules applying to quasi-judicial hearings shall not apply.
3. (3) The commissioner shall whenever possible designate a place in the county seat of the county from which the appeal has arisen for the conduct of the hearing.
(g) A decision shall be made by the commissioner or the hearing officer, as soon as possible after the date of the hearing, on the appeal. The local governmental unit and the applicant shall be notified of the decision. In every case where a decision is rendered in favor of the applicant's proposal, the requirements of local government agreement or certification, shall be deemed to have been satisfied.