1. 1. An individual who has entered into a written contract with the department; and in the case of an individual who is enrolled in the final year of a course of study and fails to maintain an acceptable level of academic standing in the educational institution in which such individual is enrolled or voluntarily terminates such enrollment or is dismissed from such educational institution before completion of such course of study or fails to become licensed pursuant to chapter 334, RSMo, within one year shall be liable to the state for the amount which has been paid on his behalf under the contract.

2. 2. If an individual breaches the written contract of the individual by failing either to begin such individual's service obligation or to complete such service obligation, the state shall be entitled to recover from the individual an amount equal to the sum of:

   1. (1) The total of the amounts prepaid by the state on behalf of the individual;
   2. (2) The interest on the amounts which would be payable if at the time the amounts were paid they were loans bearing interest at the maximum prevailing rate as determined by the Treasurer of the United States;
   3. (3) An amount equal to the unserved obligation penalty, the amount equal to the product number of months of obligated service which were not completed by an individual, multiplied by five hundred dollars.
3. 3. The department may act on behalf of a qualified community to recover from an individual described in subsections 1 and 2 of this section the portion of a loan repayment paid by such community for such individual.

(L. 1988 H.B. 1380 § 7)