(70 ILCS 605/9-7) (from Ch. 42, par. 9-7)
Sec. 9-7.
Indebtedness of merged districts.
In case any district merged into a consolidated district has bonds or
notes outstanding which are a lien on funds on hand in the treasury of the
district at the time of consolidation, or on assessments which are unpaid
at the time of consolidation, such lien shall be unimpaired by such
consolidation and the lien shall continue in favor of the bond or note
holders. The funds on hand and the assessments when collected shall be set
apart and held for the purpose of retiring such secured debt and no such
funds or assessments shall be transferred into the general funds of the
consolidated district until all indebtedness of the merged district has
been discharged.
In case any district merged into a consolidated district has unsecured
debts outstanding at the time of consolidation, any funds in the treasury
of such district or otherwise available and not committed shall, to the
extent necessary, be applied to the payment of such debts. If the funds on
hand or otherwise available are not sufficient to satisfy such
indebtedness, the court may, if such an assessment would otherwise be
authorized, direct the commissioners of the consolidated district to levy
an assessment against the lands in the merged debtor district for the
purpose of paying such indebtedness. The proceeds of such assessment shall
be used to pay the costs and expenses incident to the levy and collection
of the assessment and for the payment of such indebtedness, and for no
other purpose.
(Source: Laws 1955, p. 512.)
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