(1) Assessment bonds are not a general obligation of the local entity that issues them.

(2) A local entity that issues assessment bonds: (a) may not be held liable for payment of the bonds except to the extent of: (i) funds created and received from assessments against which the bonds are issued; (ii) improvement revenues; and (iii) the local entity's guaranty fund under Section 11-42-701 or, if applicable, reserve fund under Section 11-42-702; and (b) is responsible for: (i) the lawful levy of all assessments; (ii) the collection and application of improvement revenues, as provided in this chapter; (iii) the creation and maintenance of a guaranty fund or, if applicable, a reserve fund; and (iv) the faithful accounting, collection, settlement, and payment of: (A) assessments and improvement revenues; and (B) money in a guaranty fund or, if applicable, a reserve fund.

(a) may not be held liable for payment of the bonds except to the extent of: (i) funds created and received from assessments against which the bonds are issued; (ii) improvement revenues; and (iii) the local entity's guaranty fund under Section 11-42-701 or, if applicable, reserve fund under Section 11-42-702; and

(i) funds created and received from assessments against which the bonds are issued;

(ii) improvement revenues; and

(iii) the local entity's guaranty fund under Section 11-42-701 or, if applicable, reserve fund under Section 11-42-702; and

(b) is responsible for: (i) the lawful levy of all assessments; (ii) the collection and application of improvement revenues, as provided in this chapter; (iii) the creation and maintenance of a guaranty fund or, if applicable, a reserve fund; and (iv) the faithful accounting, collection, settlement, and payment of: (A) assessments and improvement revenues; and (B) money in a guaranty fund or, if applicable, a reserve fund.

(i) the lawful levy of all assessments;

(ii) the collection and application of improvement revenues, as provided in this chapter;

(iii) the creation and maintenance of a guaranty fund or, if applicable, a reserve fund; and

(iv) the faithful accounting, collection, settlement, and payment of: (A) assessments and improvement revenues; and (B) money in a guaranty fund or, if applicable, a reserve fund.

(A) assessments and improvement revenues; and

(B) money in a guaranty fund or, if applicable, a reserve fund.

(3) If a local entity illegally assesses property that is exempt from assessment, the local entity: (a) is liable to the holders of assessment bonds for the payment of the illegal assessment; and (b) shall pay the amount for which it is liable under Subsection (3)(a) from the local entity's general fund or other legally available money.

(a) is liable to the holders of assessment bonds for the payment of the illegal assessment; and

(b) shall pay the amount for which it is liable under Subsection (3)(a) from the local entity's general fund or other legally available money.