This section applies only to an authority with a preexisting district for which:
(1) the increments from the district were insufficient to pay preexisting obligations as a result of the class rate changes or the elimination of the state-determined general education property tax levy under this act, or both; or
(2)(i) the development authority has a binding contract, entered into before August 1, 2001, with a person requiring the authority to pay to the person an amount that may not exceed the increment from the district or a specific development within the district; and
(ii) the authority is unable to pay the full amount under the contract from the pledged increments or other increments from the district that would have been due if the class rate changes or elimination of the state-determined general education property tax levy or both had not been made under Laws 2001, First Special Session chapter 5.
(a) For purposes of this section, the following terms have the meanings given.
(b) "Preexisting district" means a tax increment financing district for which the request for certification was made before August 1, 2001.
(c) "Preexisting obligation" means a bond or binding contract that:
(1)(i) was issued or approved before August 1, 2001, or was issued pursuant to a binding contract entered into before July 1, 2001; or
(ii) was issued to refinance an obligation under item (i), if the refinancing does not increase the present value of the debt service; and
(2) is secured by increments from a preexisting district.
(a) An authority with a district qualifying under this section may take either or both of the following actions for any or all of its preexisting districts:
(1) the authority may elect that the original local tax rate under section 469.177, subdivision 1a, does not apply to the district; and
(2) the authority may elect the fiscal disparities contribution will be computed under section 469.177, subdivision 3, paragraph (a), regardless of the election that was made for the district or if the district is an economic development district for which the request for certification was made after June 30, 1997.
(b) The authority may take action under this subdivision only after the municipality approves the action, by resolution, after notice and public hearing in the manner provided under section 469.175, subdivision 3. To be effective for taxes payable in the following year, the resolution must be adopted and the county auditor must be notified of the adoption on or before July 1.