(a) The State Board of Education shall purchase out of the Revolving Certificate Proceeds Account and shall set aside as collateral revolving loan bonds of school districts that bear the same or greater rates of interest and, in the aggregate, equal the principal amount of the certificates with the end in view of ensuring the availability at all times of collateral that will produce sufficient funds to meet interest and principal payments on the certificates as they become due.(b) The collateral shall either be delivered to the holder of the certificate to which applicable or held as a separate fund for the benefit of the holder.(c) The collateral must mature at such times as will permit the principal of the certificates to be paid as it becomes due.(d) The interest and principal payments received on the collateral shall be applied to the payment of the interest on and principal of the certificate to which it is pledged.(e) The delivery or setting aside of the collateral as provided in this subchapter shall constitute a valid and perfected pledge thereof without more, notwithstanding the provisions of any other law pertaining to pledges and their perfecting which, but for the ed in this subchapter shall constitute a valid and perfected pledge thereof without more, notwithstanding the provisions of any other law pertaining to pledges and their perfecting which, but for the provisions of this subchapter, would be applicable.Acts 1967, No. 479, § 5; A.S.A. 1947, § 80-962.
Arkansas Legal Code