(1) Contracts or leases entered into prior to May 21, 1996, with respect to any program or function transferred to the department of children's services with any entity, corporation, agency, enterprise or person, shall continue in full force and effect as to all essential provisions in accordance with the terms and conditions of the contracts in existence on May 21, 1996, to the same extent as if such contracts had originally been entered into by and between such entity, corporation, agency, enterprise or person and the department of children's services, unless and until such contracts or leases are amended or modified by the parties thereto or until the expiration of such contract.
(2) This chapter shall not be implemented in any manner that violates the prohibition against impairment of contract obligations as contained in article I, § 20 of the Constitution of Tennessee.