§39-7-21. Obligations of contracts of municipality not to be impaired; payment of notes, bonds or other obligations issued by municipality; assumption of municipal contracts as to plant or system by authority.

The obligations of contracts of the municipality shall not be impaired by this chapter.

Moneys to provide for the payment of notes, bonds or other obligations issued by the municipality in relation to any plant or system, the management, supervision, possession and control of which shall devolve upon such authority, shall be raised, collected and paid for by such municipality as though this chapter had not been enacted; except, that in the event such notes, bonds or other obligations constitute a charge, lien or other encumbrance upon the revenue of such plant or system, the duty to raise, collect and apply such revenues to the payment of such notes, bonds or other obligations shall rest upon such authority rather than upon the municipality and such notes, bonds or other obligations shall remain a charge, lien or other encumbrance upon such revenues.

All contracts of such municipality in relation to any such plant or system shall be assumed by such authority and the terms and conditions to be performed on the part of such municipality shall be complied with and performed by the board of trustees of such authority and the benefits of such contracts shall inure to the benefit of such authority.

(Acts 1935, No. 40, p. 72; Code 1940, T. 50, §36.)