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Thread: Borrowing 16th section principal funds to create a new note.

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    Janet Wilson Guest

    Default Borrowing 16th section principal funds to create a new note.

    Q May a district borrow $100,000 from its 16th section principal fund and combine it with the district’s current two notes to establish a new 20 year note for the purpose of constructing new school buildings?

    A No. A district may not combine old loans from the sixteenth section land principal fund with a new loan from the same fund if the result would extend the term of the original debt past the 20 year term permitted by statute. (Attorney General’s Opinion to Dearman dated February 20, 2009)
    Last edited by Janet Wilson; 10-12-2009 at 04:57 PM.

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