With funds available to the governing boards for purposes other than the payment of
compensation to personnel and the lease or rental of offices or equipment, the governing
boards may acquire from any bank or other lending institution of this state a contingent
interest in student obligations. The total contingent interest of the governing boards on all such obligations shall
not exceed at any one time a sum of twelve and one-half times the total funds which
the governing boards can employ to acquire such contingent interests. When a governing board acquires any such contingent interest, it may require the
payment to it of a portion of the interest payable upon any such obligation. In each such acquisition, the governing board shall provide that at such time as
the obligation becomes delinquent, the bank or other lending institution shall notify
the governing board forthwith and shall transfer forthwith to the governing board,
by assignment or otherwise, an interest in such obligation equal to the contingent
interest of the governing board therein. The bank or other lending institution and the governing board shall forthwith take
such steps as may be necessary to recover the balance due upon any such obligation,
and such recovery shall be apportioned between the governing board and the bank or
other lending institution as their respective interests may appear.
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