At June 30, 1992, the Department of Transportation and Maryland Transportation Authority had
commitments of approximately $398,969,000 and $38,000,000, respectively, for construction of highway and mass
transit facilities. Approximately 42% of future expenditures related to the Department of Transportation
commitments are expected to be reimbursed from proceeds of approved Federal grants when the actual costs are
incurred. The remaining portion will be funded by other financial resources of the Department.

The Department of Transportation, as lessor, leases space at various marine terminals, airport facilities and
office space pursuant to various operating leases. Minimum future rental revenues follow (amounts expressed in
thousands):

Years Ending	Noncancellable Operating Leases
June 30,	Minimum Future Rentals
1993 .........................	$ 36,772
1994 .........................	30,442
1995 .........................	28,511
1996 .........................	22,350
1997 .........................	21,686
1998 and thereafter ............	139,374
	$279,135

Total minimum future rental revenues do not include contingent rentals that may be received under certain
concession leases on the basis of a percentage of the concessionaire's gross revenue in excess of stipulated
minimums. Rental revenue was approximately $59,686,000 for the year ended June 30,1992, including contingent
rentals of approximately $17,455,000.

At June 30, 1992, the Maryland State Lottery Agency had commitments of approximately $5,486,000 for
services to be rendered relating principally to the operation of the lottery game.

At June 30, 1992, the Maryland Stadium Authority had commitments of approximately $1,000,000 for
property acquisitions.

At June 30, 1992, the higher education fund had commitments of approximately $105,989,000 for the
completion of projects under construction.

19. Contingencies:

The State is party to legal proceedings, which normally occur in governmental operations. The legal
proceedings are not, in the opinion of the Attorney General, likely to have a material, adverse impact on the
financial position of the State as a whole.

At June 30,1992, mortgage loan insurance programs included in the enterprise funds were contingently liable
as insurer of mortgage loans payable, or portions of mortgage loans payable, in an aggregate amount of
approximately $691,411,000 (including $538,541,000 for the economic development loan programs). In addition,
there are commitments to insure mortgage loans which would represent additional contingent liabilities of
approximately $79,079,000.

The Maryland Higher Education Loan Corporation (Corporation), as endorser of student loans, is
contingently liable to lending institutions for purchase of student loans in default. In the event of such default, the
Corporation is liable to the lending institution for the unpaid principal amount of the loan plus unpaid interest,
including interest accrued from the date of default until the date of purchase by the Corporation. At June 30,1992,
the Corporation has endorsed loans outstanding of approximately $920,000,000. These loans are covered by a
Federal reinsurance agreement with the U.S. Department of Education. The agreement provides for repurchase
by the U.S. Department of Education of 100% of the amount of loans which default; however, if the default rate
exceeds 5% of the loans in repayment status as of September 30 of the preceding year, the reinsurance rate is
90%, and for all defaults in excess of 9% the reinsurance rate is 80%.

The State receives significant financial assistance from the U.S. Government. Entitlement to the resources is
generally conditioned upon compliance with terms and conditions of the grant agreements and applicable Federal
regulations, including the expenditure of the resources for eligible purposes. Substantially all grants are subject to
financial and compliance audits by the grantors. Any disallowances as a result of these audits become a liability of
the fund which received the grant. At June 30,1992, the State estimates that no material liabilities will result from
such audits.

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