In Village of Scarsdale v. Jorling (229 AD2d 101, 653 N.Y.S.2d 935 [2d Dept 1997], affd 91 NY2d 507, 695 N.E.2d 1113, 673 N.Y.S.2d 32 [1998]), the petitioners challenged a government decision against reviewing an increase in consumer water rates imposed by the NYC Water Board.

The Water Board argued that the action was time-barred, because the first phase of the increase went into effect more than four months before the action was commenced.

The Second Department reasoned that the proceeding was timely commenced, because if the proceeding were commenced immediately following the initial rate increase, the Water Board would have argued that the petitioners failed to exhaust their administrative remedies by neglecting to first pursue redress from the New York State Department of Environmental Conservation, which the Water Board had acknowledged was the appropriate course of action.

The Court held that, therefore, "the Water Board may not now take the position that the petitioners, by seeking administrative review of the issue by the DEC, have allowed the applicable limitations period to expire." Village of Scarsdale, 229 AD2d at 107.

Thus, Village of Scarsdale does not hold that Article 78 proceedings can be brought at different phases in a multi-phase project, but rather, that it begins to run when the affected party has exhausted its administrative remedies.