Ch. 311                                    LAWS OF MARYLAND

(ii) A provision for payments   of principal     and

interest, in accordance with an amortization   schedule that   the

Secretary approves, for not more than a 40-year   period from     the
end of the 5-year period;

(iii) A provision for an interest rate that
equals:

1.  The net interest cost of the most
recent sale of State general obligation bonds before the date of
the loan plus 1/8 of 1 percent, for a loan made from sources
other than State general obligation bond proceeds;

2.  For a loan made from the proceeds of a
State general obligation bond issue either:

A.  The net interest cost of the sale of
State general obligation bonds out of which the loan is made plus
1/8 of 1 percent; or

B.  The maximum interest rate permitted
under applicable federal tax law or required pursuant to
resolutions of the Board of Public Works adopted in connection
with the issuance of the State general obligation bonds out of
which the loan is made;

(iv) A provision that requires the borrowing
subdivision to give the Secretary at least 30 days prior written
notice of any proposed sale, lease, or conveyance and that
requires that prior written approval of the Secretary before the
sale, lease, or conveyance, which approval the Secretary shall
grant unless the sale, lease, or conveyance violates a provision
of the loan agreement or is clearly inconsistent with the
purposes of this subtitle; and

(v) A provision that requires, on sale of any
portion of the land, prepayment of the principal of the loan from
the sale proceeds in an amount that equals the amount of the
original loan multiplied by the proportion of the land sold to
the total land for which the loan was made originally and a
provision for reducing the amortization payments accordingly.

(3) The loan agreement may contain regulatory and
security provisions.

(d)  The loan agreement shall be recorded among the land
records of the subdivision in which the land is located and shall
constitute a lien upon the land and improvements.

(e)  A loan may be made under this section to acquire
railroad property or rights-of-way, up to 100 percent of the cost
of acquisition. The contents of the application set forth in
subsection (a) and the factors to be considered by the Secretary

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