The Newark journal., 1918-10-31

limitation contained in Section 1 of Article 16 of the Constitution, the credit of the State may be loaned and indebtedness incurred to an amount not exceeding two per cent of the assessed valuation of all the property in the State for the purpose of pro- viding funds to be loanel upon the security of farm lands within the State, subject to the limitations here in contained
 Section ?. The Governor, Secretary of State and State Land Commission CT shall constitute the State Land Board which board is hereby author ized and directed to issue and sell State to be known as the Arkansas Farm Credit Bonds" in an amount not to exceed two per cent of the assess ed valuation of all the property in the State, and to place the proceeds in the State Treasury in a fund to be known as the Arkansas Rural Credits Loan Fund"
 Sec. 8 Said bonds shall be issued in denominations of $25.00, S10000, $50000 and S1,00000 and shall be is sued in series of 100000 or multi ples thereof drawn to mature in not more than thirty-six years; nor shall said bonds be sold until applications from bona fide purchasers of land ag- gregating $10,00000 have been filed with and approved by the State Land est at the rate of four per cent per annum, and shall be exempt from tax ation by the State of Arkansas. or any of its subdivisions.
 Sec. 1. Said State Land Board is authorized and directed to loan the moneys in said Arkansas Rural Cred its Loan Fund to bona fide purchasers of farm lands in Arkansas, upon notes secured by mortgages or deeds of trust constituting first liens on such farm lands in amounts which shall not exceed seventy five per cent of the appraised value of such lands. The credit of the State shall not be loan ed to any person to purchase more than 80 acres of land, nor land valued at more than S5000 per acre. Nor shall loan of less than $200.00 nor more than $3,000.00 be made to any purchaser of land.
 Sec. 5. Such loans shall not be made except to owners who operate" and occupy" lands mortgaged and shall be made for the following pur- poses: (a) The payment for lands purchased; (b) the purchase of live stock and other equipment, and the making of improvements which in the judgment of the board will increase the production of such lands or add to their value as farm home in q degree to justify such expenditure; and (c) for the satisfaction of en- cumberances upon such lands, which in the judgment of said board were incurred or assumed by said applicant for the aforesaid purposes.
 Sec. 6. Every applicant for farm loan shall state clearly in his appliea- tion the purposes for which such loan IS desired and upon its approval by the board this statement shall be deemed a part of the note or contract under which the loan IS granted. But no failure to apply such funds to the purposes stated in said application or enumerated herein shall invalidate a loan when once made, nor shall any thing herein contained be deemed to prevent any farm owner from selling or leasing lands subject to such in- eumbrance; but if he shall violate his said contract by applying the moneys borrowed to purposes other those stated in his application or emu merated herein, or if he shall lease such lands or sell them to any per son not fulfilling the conditions and purposes provided herein, said board is authorized and directed to require the repayment of said loan upon six months notice, and said note or con- tract shall contain a clause providing therefor.
 Sec. z Such loans shall be repaid with interest accruing in annual in- stallments on the amortization plan, such installments being fixed at such sums as will cover the interest rate and will liquidate the debt in period to be agreed upon between said board and the applicant, said period to be not less than five nor more than thu ty-six years; but any debtor may liquidate any part or all of his in1ebt- edness in amounts of $50.00 or multi ples thereof upon any amortization payment date.
 Sec. 8. The rate of interest on loans shall be five per cent per an- nun; provided that TO Farm Credit Bonds shall be sold for less than par; and provided further that the board shall require each applicant to pay an initial charge of l per cent of the