(a) For the purpose of providing funds for the design, construction, establishment, purchase, or condemnation of water, sewerage, drainage, and solid waste systems in Frederick County pursuant to this chapter, the County is hereby authorized and empowered to borrow money, from time to time, and to evidence such borrowing by the issuance of bonds, which shall constitute a pledge of the full faith and credit and unlimited taxing power of the County.
(b) The bonds of each issue shall be designated, shall be dated and shall bear interest at such rate or rates, shall mature in such amount or amounts and at such time or times not exceeding 40 years from their date or dates of issue, as may be determined by the County, and may be made redeemable before maturity, at the option of the County, at such price or prices and under such terms and conditions as may be fixed by the County prior to the issuance of the bonds. The County may provide for creation of a sinking fund or funds for the payment of the bonds at or prior to their maturity date or dates. The County shall determine the form of the bonds, including any interest coupons to be attached thereto, and the manner of execution of the bonds, and shall fix the denomination or denominations of the bonds and the place or places of payment of principal and interest, which may be at any bank or trust company, and any other matter relating to the form, terms, conditions, issuance, sale and delivery of the bonds. In case any officer whose signature shall appear on any bonds or coupons shall cease to be such officer before the delivery of such bonds or shall become such after the date of issue thereof, such signature shall nevertheless be valid and sufficient for all purposes the same as if he had remained in office until such delivery or had held said office on said date of issue. The bonds may be issued in coupon or in registered form, or both, as the County may determine, and provision may be made for the registration of any coupon bonds as to principal alone, or as to both principal and interest, and for the reconversion into coupon bonds of any bonds registered as to both principal and interest. The County may sell such bonds in such manner, either at public or private sale, and for such price, as the County may determine to be in the best interest of the County. At any time prior to the issuance of any such bonds the County may, in addition to any sums appropriated under any other provision of law, advance such sums as may be necessary to cover the expense of issuance of such bonds, which shall be treated and repaid as part of the cost of the project or projects financed with the proceeds of any such bonds.
(c) The proceeds of such bonds shall be used solely for the payment of the cost of the project or projects on account of which such bonds are issued and the cost of issuance of such bonds and shall be disbursed in such manner and under such restrictions, if any, as the County may provide in the authorizing resolution. If the proceeds of such bonds, by error of estimates or otherwise, shall be less than such cost, additional bonds may in like manner be issued to provide the amount of such deficit, and, unless otherwise provided in the authorizing resolution, shall be deemed to be of the same issue and shall be entitled to payment from the same fund without preference or priority of the bonds first issued for the same purpose.
(d) In every case where the proceeds of any such issue of bonds are expended for the cost of one or more projects, the County shall cause separate capital accounts to be created for each such project,
among which the bond proceeds shall be divided and from which the separate costs of each such project shall be paid. In connection with the proceeds of any issue of bonds expended for the purchase, expansion or development of water and sewer systems to be acquired, constructed or reconstructed by the County and consolidated with the County’s system and to the extent practicable after giving due consideration to the financial condition of the County and the County’s ability to incur indebtedness for any other purposes, the County shall endeavor to provide for annual debt service on such issue of bonds from the funds provided by connection charges described in § 2-13-22. If necessary, the County shall levy special assessments or other charges with respect to each such system in such a manner as to provide a proportionate share of the annual debt service on the issue of bonds equal to the proportion of the proceeds of the issue expended for the system.
(e) The County’s full faith and credit and unlimited taxing power shall be unconditionally pledged to the payment of the principal of and interest on any bonds issued pursuant to this section. In the event that the funds available to the County from all sources are insufficient to pay any bonds issued hereunder, together with the interest due thereon, the County, in each and every fiscal year in which bonds are outstanding, shall levy and collect ad valorem taxes upon all the legally assessable property within the corporate limits of Frederick County in rate and amount sufficient to provide for such payments when due, together with accrued interest to the date of payment. In the event the proceeds from the taxes so levied in any fiscal year are inadequate for the above purposes, the County shall levy additional taxes in the succeeding fiscal year to make up any deficiency.
(Code 1959, § 10A-20; 1968, Chapter 609, § 1; 1979, Chapter 185, § 1; 1979, Chapter 723, § 1; 1987, Chapter 93, § 1; 1988, Chapter 659, § 1; 1991, Chapter 194, § 1; 2008, Chapter 36, § 1) (Bill No. 22-21, 10-25-2022)
Editor’s note:
Ch. 723 of the 1979 Acts designated the above section as section 10A-20 of the 1959 county code; however, such section constitutes an amendment and renumbering of former section 10A-16 of the 1959 Code.