1. Whenever any lands within a levee or drainage district organized under the laws of this state are so situated that subsequent improvements constructed within the district either by the district or by some other agency partially or wholly nullify the benefits accruing from improvements previously constructed by the district and for which benefits were assessed against the lands, the owner or owners may file a petition with the clerk of the court or county commission by which the district was organized setting out such facts with particularity and requesting that the benefits assessed against the lands for such previously constructed improvements be reduced for the purpose of making a more equitable basis for the levy of the maintenance tax, or that they be cancelled. In districts organized in the circuit court, the circuit clerk shall cause notice of the filing and hearing of the petition to reduce or cancel the assessed benefits to be served upon the president and secretary of the district at least thirty days prior to the hearing date. In districts organized in the county commission, the county commission, in its discretion, may order that notice of the filing and hearing of the petition be given to persons interested in the lands and property included within the district by publication or otherwise.

2. Upon hearing of the petition the court or county commission may reduce or cancel the assessed benefits or may deny the petition as it deems just. All costs of the hearing shall be borne by the petitioners whether they be successful or not. If the court or commission reduces or cancels the benefits assessed against the lands, thereafter the annual maintenance tax which may be levied shall apply to the benefits as reduced or cancelled.

3. No assessed benefits shall be reduced or cancelled under the provisions of this section while the district has outstanding bond obligations.