(A) There is hereby established a separate and special fund of the City to be designated as the “Improvement Bond Funds”, which fund shall be maintained by the Clerk-Treasurer on the books of the City so long as any bonds payable therefrom shall be outstanding. The bonds to be payable from the fund shall be designated by resolutions of the City Council, but shall include only bonds issued pursuant to and in accordance with the provisions of M.S. Ch. 429, as it may be amended from time to time.
(B) Prior to the issuance of any bonds, the City Council shall undertake and agree that upon completion of each improvement financed by the bonds and after payment in full of the cost of the improvement, all moneys remaining in the Improvement Fund and all subsequent collections of special assessments levied in respect of the improvement shall be irrevocably appropriated to and paid into the Improvement Bond Redemption Fund; and, the City Council shall levy a tax for years and in the amounts required, together with anticipated collections of special assessments in respect of the improvements financed by each issue of the bonds, to produce sums not less than 5% in excess of each principal and interest payment on the bonds, as the payments shall respectively become due; provided that, if the assessments to be levied for improvements financed by any issue, together with interest on the assessments at the rate fixed by the City Council, plus any amount appropriated from the bond proceeds for the making of initial interest payments shall be sufficient to produce sums 5% in excess of the principal and interest requirements, no tax levy shall be required.
(C) The special assessments and taxes levied and appropriated to the fund shall be irrevocable; provided that, in the event that the City Council shall in any year appropriate moneys from other sources to the fund which are payable in the succeeding year may be reduced by the amount of the appropriation, at the time and in the manner provided by M.S. § 475.61, as it may be amended from time to time.
(D) The moneys in the fund shall be used solely for the payment of the principal and interest when due on the bonds designated by the resolutions, and for the prepayment and redemption of the bonds when and if the same become prepayable according to their terms; provided that, the moneys may be invested as authorized by M.S. § 118A.04, as it may be amended from time to time.
(E) The full faith and credit of the City shall be and is hereby irrevocably pledged for the prompt and full payment of the principal and interest on all bonds made payable from the Improvement Bond Redemption Fund. If, at any time, the moneys in the fund shall be insufficient to pay all principal and interest due, the City Council shall provide sufficient moneys for the payment from any other funds of the City, and the funds may be reimbursed from the proceeds of the special assessments and taxes appropriated to the Improvement Bond Redemption Fund; and, the City shall have the power and authority, and it shall be the duty of the City Council, to levy additional ad valorem taxes upon all of the taxable property within its corporate limits to the extent required to restore any deficiency in the fund for the payment of the bonds and interest, which levy may be made without limitation as to rate or amount.
(Prior Code, § 102.02)