As used in this title, the following terms shall include and mean:

1. "Air quality improvement project." a. The upgrading of an existing incinerator, furnace or boiler and appurtenances thereto owned and operated by the state or a municipality, or

b. The establishment of a solid waste recovery and management project, as defined in subdivision two of section 51-0903 of this article, which directly enables permanent closure of an incinerator that is operating in a manner not in compliance with applicable air pollution control regulations and which project in all other respects qualifies for state assistance pursuant to title nine of this article.

2. "Cost." The cost of upgrading including the cost of all systems, facilities, machinery and equipment, engineering and architectural services, plans and specifications, consultant and legal services, and other direct expenses incident to such upgrading less any federal assistance received or to be received.

3. "Municipality." A city, county, town, village or school district or an improvement district within a city, county, town or village, or any combination thereof.

4. "Upgrading." Construction, reconstruction, renovation, or other process or activity necessary to insure that an existing incinerator or furnace or boiler meets air quality emission standards promulgated by the commissioner.