(a) After a local referendum authorizing the sale of local school bonds and in anticipation of the issuance of the bonds, the board of school trustees or board of education of a school district may issue and sell notes of the school district at either public or private sale for not less than par and accrued interest. The notes shall bear interest at a rate not exceeding 5% per annum. They may be renewed from time to time by the issuance and sale of new notes, but all such notes shall mature and be paid not later than 4 years after issuance. The notes shall be signed by the chairperson and 1 member of the board of school trustees or president and 1 member of the board of education of the district, the seal of the school district shall be impressed on each of the notes and shall be payable at a place prescribed by the issuing officers of the State. All provisions of law pertaining to local school bonds and not inconsistent with this chapter shall apply to notes issued hereunder.
(b) The total amount of notes outstanding at any 1 time, together with the total amount of bonds theretofore issued in any district, shall not exceed that portion of the total authorized bonded indebtedness of the school district for which bonds have been authorized by local referendum within the district.
(c) The notes may be redeemed at par and accrued interest prior to their maturity if the right of the school district to do so shall have been reserved by an express provision in the notes. The principal and interest on said notes, including renewal notes, shall be paid from the proceeds of the sale of bonds or from other funds available therefor. The notes shall be general obligations of the school district and the faith and credit of the school district shall be pledged for the full and complete payment of the principal of and interest on such notes and such notes shall be exempt from taxation with respect to both principal and interest by the State or any political subdivision thereof for any purpose. The board of education or the board of school trustees of the issuing school district shall have the same power to levy taxes to pay such notes and the interest thereon as in the case of bonds.