(a) All municipal property, including funds, owned or held for the municipality for the purposes of this chapter are exempt from levy and sale by execution. An execution or other judicial proceeding may not issue against the property, and a judgment against the municipality may not be a charge or lien on that property. This subsection does not apply to or limit the right of an obligee to pursue any remedies for the enforcement of any pledge or lien given under this chapter by a municipality on its rents, fees, grants, or revenues from urban renewal projects.
(b) If real property in the urban renewal project area is acquired and is owned as part of the project by a municipality or the urban renewal agency, and the project is not subject to ad valorem taxes because of Subsection (a), the gross project cost may include reasonable payments in lieu of taxes.