In each town or city and in each county of the state there is hereby created a public body corporate and politic to be known as the “housing authority” of the town or city or county. However, such authority shall not transact any business or exercise its powers hereunder until or unless the governing body of the town or city or the county, as the case may be, by proper resolution shall declare at any time hereafter that there is need for an authority to function in such town or city or county. The determination as to whether there is such need for an authority to function (a) may be made by the governing body on its own motion or (b) shall be made by the governing body upon the filing of a petition signed by twenty-five (25) residents of the town or city or county, as the case may be, asserting that there is need for an authority to function in such town or city or county and requesting that the governing body so declare.

The governing body shall adopt a resolution declaring that there is need for a housing authority in the town or city or county, as the case may be, if it shall find (a) that unsanitary or unsafe inhabited dwelling accommodations exist in such town or city or county or (b) that there is a shortage of safe or sanitary dwelling accommodations in such town or city or county available to persons of low income at rentals they can afford. In determining whether dwelling accommodations are unsafe or unsanitary said governing body may take into consideration the degree of overcrowding, the percentage of land coverage, the light, air, space and access available to the inhabitants of such dwelling accommodations, the size and arrangement of the rooms, the sanitary facilities, and the extent to which conditions exist in such buildings which endanger life or property by fire or other causes.

In any suit, action or proceeding involving the validity or enforcement of or relating to any contract of the authority, the authority shall be conclusively deemed to have become established and authorized to transact business and exercise its powers hereunder upon proof of the adoption of a resolution by the governing body declaring the need for the authority. Such resolution or resolutions shall be deemed sufficient if it declares that there is such need for an authority and finds in substantially the foregoing terms (no further detail being necessary) that either or both of the above enumerated conditions exist in the town or city or county, as the case may be. A copy of such resolution duly certified by the clerk shall be admissible in evidence in any suit, action or proceeding.