(1) The credit of the state shall not, in any manner, be given, or loaned to, or in aid of any individual, association, municipality or corporation; nor shall the state directly or indirectly, become a stockholder in any association or corporation, provided, that the state itself may control and promote the development of the unused water power within this state.
Notwithstanding the provisions of subsection (1), there is hereby created the public school guarantee fund which shall consist of funds provided by law to guarantee the debt of school districts in accordance with law. The state may guarantee the debt of school districts and may guarantee debt incurred to refund the school district debt. Any debt guaranty, the school district debt guaranteed thereby, or any borrowing of the state undertaken to facilitate the payments of the state's obligation under any debt guaranty shall not be included as a debt of the state for the purposes of the limitation of Section 1
of Article VIII
. The legislature may provide by law that reimbursement to the state shall be obtained from moneys which otherwise would be used for the support of the educational programs of the school district which incurred the debt with respect to which a payment under the state's guaranty pursuant to this section was made.