(a) A municipality, as defined in § 7-369, and any regional school district, may authorize the issuance of bonds, notes or other obligations in accordance with the provisions of this chapter for the purpose of funding a judgment, a compromised or settled claim against it or an award or sum payable by it pursuant to a determination by a court, or an officer, body or agency acting in an administrative or quasi-judicial capacity, other than an award or sum arising out of an employment contract, in any case in which the amount of such judgment, claim, award or sum exceeds five per cent of the total annual receipts from taxation, as computed for the purposes of subsection (b) of § 7-374 or subsection (b) of § 10-56, as applicable, or two hundred fifty thousand dollars, whichever is less, provided that the last principal installment of such bonds, notes or other obligations shall mature no later than twenty years from the date of original issue of such bonds, notes or other obligations issued for such purposes. The temporary borrowing periods provided by sections 7-378 and 7-378a shall apply to the computation of the maximum maturity permitted by this section. This section shall not be applicable to the issuance of bonds, notes or other obligations to fund judgments, settlements, awards or sums payable in connection with construction projects.

(b) Any municipality may authorize the issuance of bonds, notes or other obligations in accordance with the provisions of this chapter for the purposes of (1) funding a reserve fund for property or casualty losses established pursuant to § 7-403a, or (2) funding for all or part of the cost of any project undertaken by such municipality to abate an actual or potential deleterious condition on real property that, if left unabated, would cause the collapse of a concrete foundation of a residential building due to the presence of pyrrhotite and damage the housing stock in such municipality to such an extent that a negative impact on such municipality’s economy would result.