(A) (1) In this section the following words have the meanings indicated.
(2) “Bond” means a special obligation bond, revenue bond, note, or similar instrument issued by the county in accordance with this section.
(3) “Cost” includes the cost of:
(I) Construction, reconstruction, renovation, and acquisition of all lands, structures, real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or to be acquired by the county or another entity approved by the County Commissioners;
(II) Machinery and equipment, including machinery and equipment needed to expand or enhance county services to the community development authority;
(III) Financing charges and interest prior to and during construction and, if deemed advisable by the County Commissioners, for a limited period after completion of construction, interest and reserves for principal and interest, including costs of municipal bond insurance and any other type of financial guaranty and costs of issuance;
(IV) Extensions, enlargements, additions, and improvements;
(V) Architectural, engineering, financial and legal services;
(VI) Plans, specifications, studies, surveys, and estimates of cost and of revenues;
(VII) Administrative expenses necessary or incident to determining whether to proceed with infrastructure improvements; and
(VIII) Other expenses as may be necessary or incident to the construction, acquisition, and financing of infrastructure improvements.
(B) (1) For the purposes stated under paragraph (2) of this subsection, and subject to the provisions of this section, the county commissioners may:
(I) Create a community development authority;
(II) Levy ad valorem or special taxes or fees; and
(III) Issue bonds and other obligations.
(2) The purpose of a community development authority established under paragraph (1) of this subsection is to provide financing, refinancing, or reimbursement for the cost of design, construction, establishment, extension, alteration, or acquisition of adequate storm drainage systems, sewers, water systems, roads, bridges, culverts, tunnels, streets, sidewalks, lighting, parking, parks and recreation facilities, facilities for indoor and outdoor recreational and cultural uses, entrance areas, security facilities, guard houses, fencing, landscaping improvements, curbs and gutters, museums and cultural facilities, dams, flood mitigation uses, libraries, transit facilities, solid waste facilities, and other infrastructure improvements as necessary, whether situated within the community development authority or outside the community development authority, if the infrastructure improvement is reasonably related to other infrastructure improvements within the community development authority, for the development and utilization of the land, each with respect to any defined geographic region within the county.
(C) (1) Notwithstanding any other provision of public local law or public general law, and in addition to other powers that the county may have, the county commissioners may borrow money by issuing and selling bonds for any of the purposes stated in subsection (B)(2) of this section if a request is made by both:
(I) The owners of at least two-thirds of the assessed valuation of the real property located within the community development authority; and
(II) At least two-thirds of the owners of the real property located within the community development authority, provided that:
1. Multiple owners of a single parcel are treated as one owner; and
2. A single owner of multiple parcels is treated as one owner.
(2) This section is self-executing and does not require the county commissioners to enact legislation to exercise the powers granted under this section.
(D) (1) Any bonds issued under this section shall be payable from the special fund required under subsection (E) of this section.
(2) If the county commissioners issue bonds under this section, the county commissioners may:
(I) Establish sinking funds;
(II) Establish debt service reserve funds;
(III) Pledge other assets and revenues towards the payment of the principal and interest; or
(IV) Provide for municipal bond issuance or any other type of financial guaranty of the bonds.
(3) All proceeds received from any bonds issued and sold shall be applied solely to pay the cost of infrastructure improvements, including:
(I) Costs of design, construction, establishment, extension, alteration, or acquisition of infrastructure improvements;
(II) Costs of issuing bonds;
(III) Payment of the principal of and interest on loans, money advances, or indebtedness incurred by the county for any of the purposes stated in subsection (B)(2) of this section, including the refunding of bonds previously issued under this section; and
(IV) Funding of a debt service reserve fund or payment of interest prior to, during, or for a limited period of time after construction.
(E) (1) Before issuing bonds under this section, the county commissioners shall:
(I) Designate by resolution one or more areas as a community development authority;
(II) Subject to paragraph (3) of this subsection, adopt a resolution creating a special fund with respect to the community development authority; and
(III) Provide for the levy of an ad valorem or community development tax or fee on all real or personal property within the community development authority at a rate or amount designed to provide adequate revenues to pay the principal of, interest on, and redemption premium, if any, on the bonds to replenish any debt service reserve fund, and for any other purpose related to the ongoing expenses of or security for the bonds.
(2) Ad valorem taxes levied under this section shall be levied in the same manner, upon the same assessments, for the same period or periods, and as of the same date or dates of finality as are general ad valorem taxes within the community development authority and shall be discontinued when all of the bonds have been paid in full. Special taxes or fees shall be levied pursuant to subsection (N) of this section.
(3) The resolution creating a special fund under paragraph (1)(II) of this subsection shall:
(i) Pledge to the special fund the proceeds of the ad valorem or special tax or fee to be levied as provided in paragraph (1)(III) of this subsection; and
(ii) Require that the proceeds from the tax or fee be paid into the special fund.
(F) When no bonds authorized by this section are outstanding with respect to a community development authority:
(1) The community development authority shall be terminated; and
(2) Any money remaining in the special fund on the date of termination shall be paid to the general fund of the county or applied to another use approved by the county commissioners.
(G) (1) In order to implement the authority under this section to issue bonds, the county commissioners shall adopt an ordinance or resolution that:
(I) Specifies and describes the proposed undertaking and states that it has complied with subsection (E) of this section;
(II) Specifies the maximum principal amount of the bonds to be issued;
(III) Specifies the maximum rate or rates of interest for the bonds; and
(IV) Agrees to a covenant to levy upon all real or personal property within the community development authority ad valorem taxes or special taxes or fees in rate and amount at least sufficient in each year in which any of the bonds are outstanding to provide for the payment of the principal of and the interest on the bonds.
(2) The ordinance or resolution may require or may authorize the county manager to specify as the county manager deems appropriate to effect the financing of the proposed undertaking:
(I) The actual principal amount of the bonds to be issued;
(II) The actual rate or rates of interest for the bonds;
(III) The manner in which and the terms upon which the bonds are to be sold;
(IV) The manner in which and the times and places that the interest on the bonds is to be paid;
(V) The time or times that the bonds may be executed, issued, and delivered;
(VI) The form and tenor of the bonds and the denominations in which the bonds may be issued;
(VII) The manner in which and the times and places that the principal of the bonds is to be paid, within the limitations under this section;
(VIII) Provisions pursuant to which any or all of the bonds may be called for redemption prior to their stated maturity dates; or
(IX) Any other provisions not inconsistent with this section as shall be determined by the county commissioners to be necessary or desirable to effect the financing of the proposed undertaking.
(3) An ordinance or resolution authorizing the bonds required under this subsection, any ordinance or resolution adopted in furtherance of the required ordinance or resolution, the bonds, the designation of a community development authority, or the levy of a special ad valorem tax or special tax or fee shall be subject to the request of the property owners as specified under subsection (C) of this section.
(4) The special fund and any sinking fund established by the county commissioners to provide for the payment of the principal of or interest on any bonds issued by the county under the provisions of this section may not be invested by the fiscal officer of the county having custody of the special fund or any sinking fund except in the manner prescribed by Article 31, §§ 6 and 7 of the Annotated Code of Maryland. The fiscal officer having custody of the proceeds of the sale of any such bonds may invest the proceeds, pending the expenditure thereof, as prescribed by Article 95, § 22 of the Annotated Code of Maryland.
(H) The principal amount of the bonds, the interest payable on the bonds, their transfer, and any income derived from the transfer, including any profit made in the sale or transfer of the bonds, shall be exempt from taxation by the state and by the counties and municipal corporations of the state, but shall be included, to the extent required under Title 8, Subtitle 2, of the Tax—General article of the Annotated Code of Maryland, in computing the net earnings of financial institutions.
(I) (1) Bonds issued under this section may be in bearer form or in coupon form or may be registrable as to principal alone or as to both principal and interest. Each bond shall be deemed to be a security as defined in § 8-102 of the Commercial Law article of the Annotated Code of Maryland, whether or not it is one of a class or series or by its terms is divisible into a class or series of instruments.
(2) Bonds shall be signed manually or in facsimile by the president or vice president of the board of county commissioners, and the seal of the county shall be affixed to the bonds and attested to by the county manager or other similar administrative officer of the county. If any officer whose signature or countersignature appears on the coupons ceases to be such officer before delivery of the bonds, the officer’s signature or countersignature shall nevertheless be valid and sufficient for all purposes the same as if the officer had remained in office until delivery.
(3) All bonds shall mature not later than 30 years from their date of issuance.
(4) All bonds shall be sold either at public or private sale, and in the manner and upon the terms as the county commissioners deem best. Any contract for the acquisition of property may provide that payment shall be made in bonds. Bonds issued under this section are not subject to Article 31 §§ 9, 10, and 11 of the Annotated Code of Maryland.
(J) Bonds issued under this section are securities:
(1) In which all public officers and public bodies of the state and its political subdivisions, all insurance companies, state banks and trust companies, national banking associations, savings banks, savings and loan associations, investment companies, executors, administrators, trustees, and other fiduciaries may properly and legally invest funds, including capital in their control or belonging to them; and
(2) Which may properly and legally be deposited with and received by any state or county officer or any agency or political subdivision of the state for any purpose for which the deposit of bonds or obligations of the state is authorized by law.
(K) The powers granted under this section shall be regarded as supplemental and additional to powers conferred by other laws and may not be regarded as in derogation of any powers now existing.
(L) This section, being necessary for the welfare of the state and its residents, shall be liberally construed to effect the purpose stated in subsection (B)(2) of this section.
(M) Before the final adoption of an ordinance or resolution under this section that designates a community development authority, authorizes the issuance of bonds, or levies ad valorem taxes or special taxes or fees, the county commissioners shall hold a public hearing after giving not less than 10 days notice in a newspaper of general circulation in the county.
(N) (1) As an alternative to levying ad valorem taxes under this section, the county commissioners may levy special taxes or fees on property in a community development authority to cover the costs of infrastructure improvements.
(2) In determining the basis for and the amount of the tax or fee, the cost of an improvement may be calculated and levied:
(I) Equally per front foot, lot, parcel, dwelling unit, or square foot;
(II) According to the value of the property as determined by the county commissioners, with or without regard to improvements on the property; or
(III) In any other reasonable manner that results in fairly allocating the cost of the infrastructure improvements.
(3) The county commissioners may provide by ordinance or resolution for:
(I) A maximum amount to be assessed with respect to any parcel of property located within a community development authority;
(II) A tax year or other date after which no further special taxes or fees under this section shall be levied or collected on a parcel; and
(III) The circumstances under which the special tax or fee levied against any parcel may be increased, if at all, as a consequence of delinquency or default by the owner of that parcel or any other parcel within the community development authority.
(4) The county commissioners may require special taxes or fees to be paid either periodically over the terms of the bonds or in one lump sum amount due at the sale of a lot, the issuance of a building permit, or the occurrence of another event.
(5) The county commissioners may impose or levy taxes or fees in different amounts within a community development authority to reflect the extent to which different parcels of property benefit differently from the infrastructure improvements being financed or other appropriate distinctions among parcels of property. The county commissioners may create subauthorities within a community development authority to facilitate the levy or imposition of taxes or fees at different rates or levels within the authority.
(6) The county commissioners by ordinance or resolution may establish procedures allowing for the prepayment of special taxes or fees under this subsection.
(7) Special taxes or fees levied under this subsection shall be collected and secured in the same manner as general ad valorem taxes unless otherwise provided in the ordinance or resolution and shall be subject to the same penalties and the same procedure, sale, and lien priority in case of delinquency as is provided for general ad valorem taxes.
(O) Before the county commissioners may designate an area wholly or partly within a municipal corporation as a community development authority, the governing body of the municipal corporation must consent to the designation.
(P) Bonds issued under this section are a special obligation of the county and may not constitute a general obligation debt of the county or a pledge of the county’s full faith and credit or taxing power.
(Q) Notwithstanding any limitations or other provisions to the contrary under Article 25 of the Annotated Code of Maryland or under other public general or public local law, the county may enter into contracts to implement this section, including, without limitation, contracts providing for the construction or operation of infrastructure improvements financed under this section.
(1997, Chapter 517, § 1; 2001, Chapter 719, § 1; 2006, Chapter 175, § 1)