The proceeds from resale of any neighboring property taken in excess of what may be necessary for actual construction, opening, widening, extending and laying out of any public square, park or playground as provided in ORS § 226.310 to 226.390 shall be deposited in the city treasury and used in payment of interest and as a sinking fund to retire any bond issues authorized under ORS § 226.390. Any surplus arising from such transaction shall be turned over to and for the use of the park department of the city.