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Whenever any local improvement is made in whole or in part directly by the city by day labor, the city council may provide for the issuance of local improvement warrants upon the local improvement fund created by the ordinance ordering the improvement, in payment of the cost of such improvement. Said warrants shall bear interest at a rate not to exceed eight percent per annum from the date of issuance, and shall be payable only out of the said local improvement fund when the assessments are paid or the local improvement bonds sold. The cost of such improvement shall be paid for the first instance from such fund as the city council in the ordinance ordering the improvement shall direct, such fund to be reimbursed from the local improvement fund when the assessments are paid or the local improvement bonds sold. (Prior code § 13.48.200.)