Monies raised by special assessments for any public improvement shall be credited to a special assessment account and shall be used to pay for the costs of the improvement for which the assessment was levied and of expenses incidental thereto, to repay any principal and interest on money borrowed therefor, and to refund excessive assessments. The excess by which any special assessment proves larger than the actual cost of the improvement and expenses incidental thereto may be placed in the general fund of the city if the excess is 5% or less of the assessment, but should the assessment prove larger than necessary by more than 5%, the entire excess shall be refunded on a pro rata basis to the owners of the property assessed. This refund shall be made by credit against future unpaid installments in the inverse order in which they are payable to the extent such installments then exist, and the balance of the refund shall be in cash. No refunds may be made which contravene the provisions of any outstanding evidence of indebtedness secured in whole or in part by that special assessment.