Maryland Statutes
Part V - Restrictions on Bonds and Borrowing
Section 10-645 - Baltimore City Public School Facility

(a)    (1)    Except as agreed to in the memorandum of understanding under § 10–646 of this subtitle, the Authority shall comply with this section and § 5–303 of the Education Article to finance improvements to a Baltimore City public school facility.
        (2)    The Authority and the Baltimore City Board of School Commissioners, as agreed to in the memorandum of understanding under § 10–646 of this subtitle and subject to paragraph (1) of this subsection, shall be responsible for school facilities construction and improvements financed with the proceeds of bonds issued under this subtitle in accordance with the Baltimore City Public Schools’ 10–Year Plan approved by the Baltimore City Board of School Commissioners on January 8, 2013, which may be amended from time to time in accordance with parameters established for review and comment in the memorandum of understanding established under § 10–646 of this subtitle.
        (3)    (i)    Except as agreed to in the memorandum of understanding under § 10–646 of this subtitle and subject to subparagraph (ii) of this paragraph, a power granted to the Authority under this subtitle may not in any way interfere with the enumerated powers of the Baltimore City Board of School Commissioners under Title 4, Subtitle 3 of the Education Article.
            (ii)    The powers of the Baltimore City Board of School Commissioners may not limit the ability of the Authority to carry out its obligations under this subtitle with respect to the improvement of Baltimore City public school facilities and the financing related to the improvements.
    (b)    (1)    The Authority may not use any of its own money, whether appropriated or nonbudgeted, to pay for any costs or expenses related to financing improvements to Baltimore City public school facilities.
        (2)    The sole source of payment for any costs or expenses related to financing improvements to Baltimore City public school facilities shall be the money on deposit in the Baltimore City Public School Construction Facilities Fund and the Baltimore City Public School Construction Financing Fund and bond proceeds held under a trust agreement.
    (c)    At least 45 days before seeking approval of the Board of Public Works for each Baltimore City public school facilities bond issue, the Authority shall provide to the fiscal committees of the General Assembly written notice of:
        (1)    the aggregate amount of funds needed for the relevant Baltimore City public school facilities, including a list of the facilities to be improved;
        (2)    the anticipated total debt service for the proposed bond issue; and
        (3)    the anticipated total debt service when combined with the debt service for all prior outstanding bond issues for Baltimore City public school facilities.
    (d)    (1)    A bond issued to finance improvements to a Baltimore City public school facility:
            (i)    is a limited obligation of the Authority payable solely from money pledged by the Authority to the payment of the principal of and the premium and interest on the bond or money made available to the Authority for that purpose;
            (ii)    is not a debt, liability, or a pledge of the faith and credit or the taxing power of the State, the Authority, or other governmental unit; and
            (iii)    may not give rise to any pecuniary liability of the State, the Authority, or other governmental unit.
        (2)    The issuance of a bond to finance improvements to a Baltimore City public school facility is not directly, indirectly, or contingently a moral or other obligation of the State, the Authority, or other governmental unit to levy or pledge any tax or to make an appropriation to pay the bond.
        (3)    Each bond shall state on its face the provisions of paragraphs (1) and (2) of this subsection.
    (e)    Before each issuance of bonds to finance improvements to a Baltimore City public school facility, the Authority shall obtain the approval of the Board of Public Works of the proposed bond issue.
    (f)    The total debt service for any bond issue, when added to all prior outstanding bond issues related to improvements to Baltimore City public school facilities, may not exceed the total amount of the funds provided under § 9–120(b)(1)(iii) of the State Government Article and the funds provided under subsections (g) and (h) of this section.
    (g)    (1)    Beginning on July 1, 2013 and continuing until the bonds that have been issued to finance improvements to Baltimore City public school facilities are no longer outstanding and unpaid, Baltimore City shall deposit into the Baltimore City Public School Construction Financing Fund:
            (i)    subject to annual appropriation, all revenues and receipts from the beverage container tax imposed by Baltimore City Ordinance No. 12–45, enacted June 26, 2012;
            (ii)    the amounts paid by the State Comptroller to Baltimore City from the proceeds of table games at the video lottery facility located in Baltimore City that are dedicated to school construction in accordance with § 9–1A–27(d)(2)(i)1 of the State Government Article;
            (iii)    subject to annual appropriation, 10% of the participation rent paid to Baltimore City by the operator of the video lottery facility located in Baltimore City; and
            (iv)    any other revenues dedicated to or appropriated to the Baltimore City Public School Construction Financing Fund by Baltimore City.
        (2)    The money deposited into the Baltimore City Public School Construction Financing Fund in accordance with this subsection shall be at least:
            (i)    $4,000,000 by November 1, 2014;
            (ii)    an additional $4,000,000 by May 1, 2015;
            (iii)    an additional $4,000,000 by November 1, 2015;
            (iv)    an additional $4,000,000 by May 1, 2016; and
            (v)    until the bonds are no longer outstanding and unpaid:
                1.    an additional $5,000,000 by each November 1; and
                2.    an additional $5,000,000 by each May 1.
        (3)    If the funds deposited into the Baltimore City Public School Construction Financing Fund are less than the amounts required under paragraph (2) of this subsection:
            (i)    the Authority shall transfer money held in reserve for Baltimore City in the Baltimore City Public School Construction Facilities Fund to the Baltimore City Public School Construction Financing Fund in an amount equal to the lesser of:
                1.    the difference between the amount required to be paid under paragraph (2) of this subsection and the actual amount paid by Baltimore City; or
                2.    the amount held in reserve for Baltimore City in the Baltimore City Public School Construction Facilities Fund; and
            (ii)    if the amount transferred to the Baltimore City Public School Construction Financing Fund under subparagraph (i) of this paragraph is less than the difference between the amount required to be paid under paragraph (2) of this subsection and the actual amount paid by Baltimore City:
                1.    the Authority shall direct the State Comptroller to withhold, under § 2–608 of the Tax – General Article, income tax revenue from Baltimore City in an amount equal to the difference between the amount transferred under subparagraph (i) of this paragraph and the amount required to be paid under paragraph (2) of this subsection; and
                2.    the State Comptroller shall credit the withheld amount to the Baltimore City Public School Construction Financing Fund on behalf of Baltimore City on or before the 15th day of the following December or June, as applicable.
        (4)    Any money deposited by Baltimore City or on behalf of Baltimore City in accordance with this section in excess of the amount required in any semiannual period shall be transferred by the Authority to the Baltimore City Public School Construction Facilities Fund and held in reserve in accordance with paragraph (3) of this subsection and § 10–657 of this subtitle.
    (h)    (1)    Beginning on July 1, 2013, and continuing until the bonds that have been issued to finance improvements to Baltimore City public school facilities are no longer outstanding and unpaid, the State Comptroller shall withhold from any installment due the Baltimore City Board of School Commissioners from the General State School Fund money representing additional State funds received from recurring retiree health costs shifted from Baltimore City to the Baltimore City Board of School Commissioners and deposit into the Baltimore City Public School Construction Financing Fund $10,000,000 for fiscal year 2014 and each fiscal year thereafter, to be paid in equal bi–monthly payments.
        (2)    Beginning on July 1, 2015, and continuing until the bonds that have been issued to finance improvements to Baltimore City public school facilities are no longer outstanding and unpaid, in addition to the amount withheld under paragraph (1) of this subsection, the State Comptroller shall withhold from any installment due the Baltimore City Board of School Commissioners from the General State School Fund and deposit into the Baltimore City Public School Construction Financing Fund the following amounts, to be paid in equal bi–monthly payments:
            (i)    $10,000,000 for fiscal year 2016; and
            (ii)    $20,000,000 for fiscal year 2017 and each fiscal year thereafter.
    (i)    (1)    If the money deposited in the Baltimore City Public School Construction Financing Fund in accordance with subsections (g) and (h) of this section is not needed for debt service or debt service reserves, the Authority may transfer those funds to the Baltimore City Public School Construction Facilities Fund.
        (2)    If funds are needed for debt service or debt service reserves, the Authority may transfer money in the Baltimore City Public School Construction Facilities Fund to the Baltimore City Public School Construction Financing Fund.
    (j)    In connection with improvements to Baltimore City public school facilities, the Baltimore City Board of School Commissioners shall:
        (1)    deliver to the Authority buildable sites, ready for improvement and free from any restrictions, easements, impediments, hazards or conditions that would affect the Authority’s schedule or budget for the improvement to a Baltimore City public school facility;
        (2)    assume responsibility for the operation, maintenance, and repairs of each Baltimore City public school facility immediately before the occupancy of the Baltimore City public school facility or as agreed to in the memorandum of understanding under § 10–646 of this subtitle; and
        (3)    except for a transfer or assignment to the Baltimore City Board of School Commissioners, obtain the approval of the State Superintendent of Schools and the Board of Public Works before the sale, assignment, mortgage, pledge, or encumbrance of any Baltimore City public school facility, or any interest in the facility.
    (k)    (1)    Subject to subsection (b) of this section, before any bonds are issued to finance improvements to a Baltimore City public school facility, the Authority may pay for any costs of start–up, administration, overhead, and operations of the Authority or costs of engineering, architectural, and other design professionals.
        (2)    (i)    Any cost overruns, unbudgeted expenses, or unforeseen costs incurred in connection with an improvement to a Baltimore City public school facility shall be payable solely from the Baltimore City Public School Construction Facilities Fund.
            (ii)    If any cost overruns, unbudgeted expenses, or unforeseen costs occur as described in subparagraph (i) of this paragraph, the Authority shall provide a detailed report explaining the reasons for the cost overruns, unbudgeted expenses, or unforeseen costs and a description of the actions taken by the Authority to control costs within the budget established for each improvement to a Baltimore City public school facility.
    (l)    On October 1, 2013, and each January 15 thereafter, the Authority, Baltimore City, the Baltimore City Board of School Commissioners, and the Interagency Commission on School Construction jointly shall report to the Governor, the Board of Public Works and, in accordance with § 2–1257 of the State Government Article, the fiscal committees of the General Assembly, on the progress of replacements, renovations, and maintenance of Baltimore City public school facilities, including actions:
        (1)    taken during the previous fiscal year; and
        (2)    planned for the current fiscal year.
    (m)    Notwithstanding any other provision of law, a demolition or partial demolition of a school building under the Baltimore City Public Schools’ 10–Year Plan shall be exempt from any required notice to the Baltimore City Council or the President of the Baltimore City Council.
    (n)    State funds from other sources, grants, or programs may be used in combination with funds provided under this section for a project.