Section 17-1726. Obligations and property

The  outstanding obligations,
  contracts, and bonds of any  such  town  or  of  any  district  therein,
  incurred,  made  or  issued  for  the  purpose of improving the highways
  thereof,  or  constructing  overhead   or   undergrade   crossings,   or
  constructing  sidewalks or for sewers or sewer district purposes, or for
  water or  water  district  purposes,  or  for  fire  district  purposes,
  including  all obligations now outstanding or hereafter imposed upon any
  such town or district therein, shall devolve upon and be assumed by  any
  such  village,  and the board of trustees of any such village, is hereby
  authorized and empowered, and it shall be its duty, to provide  for  the
  payment  and  discharge  of  such  obligations,  contracts  and bonds by
  taxation or assessment of taxes in the  same  manner  as  the  board  of
  supervisors  or  county  legislative  body, town board, or supervisor or
  officers of such town,  or  of  any  district  therein  are  or  may  be
  authorized  to  provide  therefor  or  by  taxation  of  all the taxable
  property in such village in any case in which by virtue of any provision
  of this act or of any other statute such obligations, contracts or bonds
  are or may be made a general village charge.  All  moneys,  credits  and
  property  of  the  said town, including all public moneys payable to the
  said town, or to its supervisor, for general  town  purposes  under  any
  present or future law, shall be paid to any such village for the general
  purposes  of  such  village, and all the moneys, credits and property of
  any sewer district, water district, fire district, or other tax district
  now existing or hereafter  established  therein,  including  all  moneys
  payable  under  any  present  or  future  law to any such town or to its
  supervisor for specified town or district purposes, shall  be  paid  and
  delivered  to such village by the several custodians thereof and applied
  by the board of trustees of such village to the said  purposes.  In  any
  such  village the treasurer thereof shall serve as the fiscal officer of
  any such town, and the receiver, collector or custodian of any taxes  or
  other  moneys  payable  to  the  supervisor  of  any such town under any
  present or future law, shall pay the same to the village  treasurer  who
  shall  apply  the  same under the direction of the town board, or of the
  supervisor, or otherwise, to the lawful  purposes  for  which  the  same
  shall  have been raised. In every such village all taxes and assessments
  levied or assessed before incorporation upon the taxable property in the
  said town or upon the taxable  property  in  any  water  district,  fire
  district,  lighting  district,  or  sewer  district  therein for town or
  district purposes shall, when collected, be paid over  to  such  village
  and used by such village for the purposes for which the same were levied
  and assessed.