(a) The exercise of the powers granted by this act [this article] shall be in all respects for the benefit of the people of the state of Rhode Island, and for the improvement of their health and living conditions, and as the acquisition, operation and maintenance of projects by the authority will constitute the performance of essential governmental functions, the authority shall not at any time be required to pay any taxes or assessments upon such projects, or upon any property acquired or used by the authority under the provisions of this act or upon its income, and the bonds and notes issued by the authority, their transfer and the income therefrom (including any profit made on the sale thereof) shall at all times be free from taxation within the state of Rhode Island.
(b) Payments in lieu of taxes. The authority is authorized to enter into contracts with any political subdivision of the state in which property of the authority is situated providing for payments in lieu of taxes or assessments on such property. (P.L. 1969, ch. 110, § 12.)