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(1) A local entity may issue interim warrants against an assessment area.
(2) An interim warrant may be in any amount up to:
(a) as portions of the work on improvements in an assessment area are completed, 90% of the value of the completed work, as estimated by the local entity's project engineer;
(b) 100% of the value of the work completed, after completion of the work and acceptance of the work by the local entity's project engineer; and
(c) the price of property, the acquisition of which is required for an improvement.
(3) The governing body may:
(a) issue interim warrants at not less than par value in a manner the governing body determines; and
(b) use the proceeds from the issuance of interim warrants to pay:
(i) the contract price;
(ii) the property price; and
(iii) related costs, including overhead costs.
(4)
(a) Interim warrants shall bear interest from the date of their issuance until paid.
(b)
(i) The governing body shall:
(A) approve the interest rate applicable to interim warrants; and
(B) fix a maturity date for each interim warrant.
(ii) The interest rate applicable to interim warrants may be fixed or variable or a combination of fixed and variable.
(iii) If interim warrants carry a variable interest rate, the governing body shall specify the basis upon which the rate is to be determined, the manner in which the rate is to be adjusted, and a maximum interest rate.
(iv) A local entity may provide for interest on interim warrants to be paid semiannually, annually, or at maturity.
(v) If an interim warrant matures before the local entity has available sources of payment under Section 11-42-603, the local entity may authorize the issuance of a new interim warrant to pay the principal and interest on the maturing warrant.
(c) The local entity shall include interest accruing on interim warrants in the cost of improvements in the assessment area.
(5) A local entity may purchase some or all of the interim warrants it has issued using the local entity's general fund money.