If a contract for improvements entered into by a governmental unit authorized to levy special assessments is declared void by a court of last resort, the governing body may provide that all persons who have paid all or any part of any assessment levied against the abutting property owners because of the improvement may be reimbursed the amount of the assessment, paid from the fund, that the governing body determines. This section applies to contracts for improvements that are void for any of the following reasons:
(1) There was insufficient authority to make the contract.
(2) The contract was made contrary to a prohibition against contracting in other than a specified way.
(3) The contract was prohibited by statute.