(a) An energy improvement district board, in the exercise of its powers granted pursuant to sections 32-80a to 32-80c, inclusive, shall be for the benefit of the inhabitants of the state, for the increase of their commerce and for the promotion of their safety, health, welfare, convenience and prosperity, and as the operation and maintenance of any project which the board is authorized to undertake constitute the performance of an essential governmental function, no board shall be required to pay any taxes or assessments upon any project acquired and constructed by it under the provisions of said sections. The bonds, notes, certificates or other evidences of debt issued pursuant to subsections (a) to (h), inclusive, of section 32-80b, their transfer and the income therefrom, including any profit made on the sale thereof, shall at all times be free and exempt from taxation, except for estate or succession taxes, by the state and by any political subdivision thereof, but the interest on such bonds, notes, certificates or other evidences of debt shall be included in the computation of any excise or franchise tax.

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(b) Bonds issued by an energy improvement district board pursuant to subsection (b) of section 32-80a shall be securities in which all public officers and public bodies of the state and its political subdivisions, all insurance companies, trust companies, banking associations, investment companies and executors, administrators, trustees and other fiduciaries may properly and legally invest funds, including capital in their control or belonging to them. Such bonds shall be securities that may properly and legally be deposited with and received by any state or municipal officer or any agency or political subdivision of the state for any purpose for which the deposit of bonds or obligations is now or may hereafter be authorized by law.

(c) A municipality may, by ordinance, and any other governmental unit may, without any referendum or public or competitive bidding, and any person may sell, lease, lend, grant or convey to an energy improvement district board or permit a board to use, maintain or operate as part of any distributed resource facility any real or personal property that may be necessary or useful and convenient for the purposes of the board and accepted by the board. Any such sale, lease, loan, grant, conveyance or permit may be made or given with or without consideration and for a specified or an unlimited period and under any agreement and on any terms and conditions that may be approved by such municipality, governmental unit or person and that may be agreed to by the board in conformity with its contract with the holders of any bonds. Subject to any such contracts with the holders of bonds, the board may enter into and perform any and all agreements with respect to property so purchased, leased, borrowed, received or accepted by it, including agreements for the assumption of principal or interest or both of indebtedness of such municipality, governmental unit or person or of any mortgage or lien existing with respect to such property or for the operation and maintenance of such property as part of any energy improvement district distributed resources facility.

(d) A municipality, governmental unit or person may enter into and perform any lease or other agreement with any energy improvement district board for the lease or other agreement with any municipality, governmental unit or person of all or any part of any energy improvement district distributed resource facility or facilities. Any such lease or other agreement may provide for the payment to the board by such municipality, governmental unit or person, annually or otherwise, of such sum or sums of money, computed at fixed amount or by any formula or in any other manner, as may be so fixed or computed. Any such lease or other agreement may be made and entered into for a term beginning currently or at some future or contingent date and with or without consideration and for a specified or unlimited time and on any terms and conditions which may be approved by such municipality, governmental unit or person and which may be agreed to by the board in conformity with its contract with the holders of any bonds, and shall be valid and binding on such municipality, governmental unit or person whether or not an appropriation is made thereby prior to authorization or execution of such lease or other agreement. Such municipality, governmental unit or person shall do all acts and things necessary, convenient or desirable to carry out and perform any such lease or other agreement entered into by it and to provide for the payment or discharge of any obligation thereunder in the same manner as other obligations of such municipality, governmental unit or person.

(e) For the purpose of aiding an energy improvement district board, a municipality, by ordinance or by resolution of its legislative body, shall have power from time to time and for such period and upon such terms, with or without consideration, as may be provided by such resolution or ordinance and accepted by the board, (1) to appropriate moneys for the purposes of the board, and to loan or donate such money to the board in such installments and upon such terms as may be agreed upon with the board, (2) to covenant and agree with the board to pay to or on the order of the board annually or at shorter intervals as a subsidy for the promotion of its purposes not more than such sums of money as may be stated in such resolution or ordinance or computed in accordance therewith, (3) upon authorization by it in accordance with law of the performance of any act or thing which it is empowered by law to authorize and perform and after appropriation of the moneys, if any, necessary for such performance, to covenant and agree with the board to do and perform such act or thing and as to the time, manner and other details of its doing and performance, and (4) to appropriate money for all or any part of the cost of acquisition or construction of such facility, and, in accordance with the limitations and any exceptions thereto and in accordance with procedure prescribed by law, to incur indebtedness, borrow money and issue its negotiable bonds for the purpose of financing such distributed resource facility and appropriation, and to pay the proceeds of such bonds to the board.

(f) For the purpose of aiding an energy improvement district board in the planning, undertaking, acquisition, construction or operation of any distributed resource facility, a participating municipality may, pursuant to resolution adopted by its legislative body in the manner provided for adoption of a resolution authorizing bonds of such municipality and with or without consideration and upon such terms and conditions as may be agreed to by and between the municipality and the board, unconditionally guarantee the punctual payment of the principal of and interest on any bonds of the board and pledge the full faith and credit of the municipality to the payment thereof. Any guarantee of bonds of the board made pursuant to this subsection shall be evidenced by endorsement thereof on such bonds, executed in the name of the municipality and on its behalf by such officer thereof as may be designated in the resolution authorizing such guaranty, and such municipality shall thereupon and thereafter be obligated to pay the principal of and interest on said bonds in the same manner and to the same extent as in the case of bonds issued by it. As part of the guarantee of the municipality for payment of principal and interest on the bonds, the municipality may pledge to and agree with the owners of bonds issued under this chapter and with those persons who may enter into contracts with the municipality or the board or any successor agency pursuant to the provisions of this chapter that it will not limit or alter the rights thereby vested in the bond owners, the board or any contracting party until such bonds, together with the interest thereon, are fully met and discharged and such contracts are fully performed on the part of the municipality or the board, provided nothing in this subsection shall preclude such limitation or alteration if and when adequate provisions shall be made by law for the protection of the owners of such bonds of the municipality or the board or those entering into such contracts with the municipality or the board. The board is authorized to include this pledge and undertaking for the municipality in such bonds or contracts. To the extent provided in such agreement or agreements, the obligations of the municipality thereunder shall be obligatory upon the municipality and the inhabitants and property thereof, and thereafter the municipality shall appropriate in each year during the term of such agreement, and there shall be available on or before the date when the same are payable, an amount of money that, together with other revenue available for such purpose, shall be sufficient to pay such principal and interest guaranteed by it and payable thereunder in that year, and there shall be included in the tax levy for each such year in an amount that, together with other revenues available for such purpose, shall be sufficient to meet such appropriation. Any such agreement shall be valid, binding and enforceable against the municipality if approved by action of the legislative body of such municipality. Any such guaranty of bonds of the board may be made, and any resolution authorizing such guaranty may be adopted, notwithstanding any statutory debt or other limitations, but the principal amount of bonds so guaranteed shall, after their issuance, be included in the gross debt of such municipality for the purpose of determining the indebtedness of such municipality under subsection (b) of section 7-374. The principal amount of bonds so guaranteed and included in gross debt shall be deducted and is declared to be and to constitute a deduction from such gross debt under and for all the purposes of subsection (b) of said section 7-374, (1) from and after the time of issuance of said bonds until the end of the fiscal year beginning next after the completion of acquisition and construction of the distributed resource facility to be financed from the proceeds of such bonds, and (2) during any subsequent fiscal year if the revenues of the board in the preceding fiscal year are sufficient to pay its expenses of operation and maintenance in such year and all amounts payable in such year on account of the principal and interest on all such guaranteed bonds, all bonds of the municipality issued as provided in this subsection and all bonds of the energy improvement district board issued under subsection (b) of section 32-80a.

(g) Any energy improvement district board may pledge or assign any lease or other agreement, and any instruments making or evidencing the same to secure its bonds and thereafter may not modify such leases, agreements or instruments except as provided by the terms of such lease, agreement or instrument.

(h) All property of an energy improvement district board shall be exempt from levy and sale by virtue of an execution and no execution or other judicial process shall issue against the same nor shall any judgment against the board be a charge or lien upon its property, provided nothing in this subsection shall apply to or limit the rights of the holder of any bonds to pursue any remedy for the enforcement of any pledge or lien given by the board on its facility revenues or other moneys.

(i) An energy improvement district board and the municipality in which any property of the board is located may enter into agreements with respect to the payment by the board to such municipality of annual sums of money in lieu of taxes on such property in such amount as may be agreed upon between the board and the municipality. The board may make, and the municipality may accept, such payments and apply them in the manner in which taxes may be applied in such municipality, provided no such annual payment with respect to any parcel of such property shall exceed the amount of taxes paid thereon for the taxable year immediately prior to the time of its acquisition by the board.