(a) The governing body of an alternate municipality shall, on receipt of a petition requesting the creation of an authority and signed by not fewer than 500 registered voters of the municipality, initiate proceedings to create the authority. The governing body of an alternate municipality may initiate those proceedings without a petition.
(b) To initiate proceedings to create an authority, the governing body of an alternate municipality, by ordinance or resolution, must set a time and place for holding a public hearing and must define the boundaries of the areas proposed to be included in the authority.

(c) All the territory in the alternate municipality must be included in the initial authority, and the authority may include an area that is:
(1) completely surrounded by the alternate municipality; and
(2) designated by the alternate municipality as an industrial district.