PARRIS N. GLENDENING, Governor                                 Ch. 138

8-406. 8-407.

(A)     (1) IN THIS SECTION, THE FOLLOWING WORDS HAVE THE MEANINGS
INDICATED.

(2)      "CODE" MEANS THE INTERNAL REVENUE CODE OF 1986 AND
INCLUDES REGULATIONS AND RULINGS ISSUED UNDER THAT CODE.

(3)      (I) "FINANCIAL OFFICER" MEANS THE SECRETARY OF THE
PRINCIPAL DEPARTMENT THAT INCLUDES THE APPROPRIATE UNIT OR THE HEAD OF
THE UNIT IF THE UNIT IS AN INDEPENDENT UNIT.

(II) (I) "FINANCIAL OFFICER" MEANS THE CONTROLLER, THE
DIRECTOR OF FINANCE, OR SIMILAR OFFICIAL OF A UNIT OF THE STATE
GOVERNMENT.

(II) "FINANCIAL OFFICER" INCLUDES, TO THE EXTENT NECESSARY,
THE TREASURER AND THE COMPTROLLER.

(4)      "PROCEEDS" MEANS MONEYS RECEIVED FROM THE SALE OF A
CAPITAL LEASE, AND INCLUDES ANY MONEYS DEEMED TO BE PROCEEDS OF A
CAPITAL LEASE UNDER THE CODE.

(B)     THE FINANCIAL OFFICER MAY ESTABLISH AND MAINTAIN FUNDS AND
ACCOUNTS FOR THE ADMINISTRATION, MANAGEMENT, INVESTMENT AND
ACCOUNTING OF PROCEEDS, INCLUDING ANY INVESTMENT EARNINGS ON
PROCEEDS, THAT MAY BE NECESSARY OR APPROPRIATE FROM TIME TO TIME TO
COMPLY WITH THE CODE AND TO ESTABLISH OR MAINTAIN THE EXCLUSION FROM
GROSS INCOME FOR FEDERAL INCOME TAX PURPOSES OF INTEREST ON A CAPITAL
LEASE.

(C)     (1) THE FINANCIAL OFFICER MAY MANAGE AND INVEST PROCEEDS,
INCLUDING ANY INVESTMENT EARNINGS ON PROCEEDS, IN A MANNER SO AS TO
MAINTAIN THE EXCLUSION FROM GROSS INCOME FOR FEDERAL INCOME TAX
PURPOSES OF INTEREST ON A CAPITAL LEASE.

(2) THE FINANCIAL OFFICER MAY RESTRICT THE YIELDS ON
INVESTMENTS OF PROCEEDS IF AND TO THE EXTENT NECESSARY TO MAINTAIN THE
EXCLUSION FROM GROSS INCOME FOR FEDERAL INCOME TAX PURPOSES OF
INTEREST ON A CAPITAL LEASE.

(D)     THE FINANCIAL OFFICER MAY PREPARE AND MAINTAIN RECORDS OF
THE RECEIPT, DEPOSIT, INVESTMENT, MANAGEMENT, DISBURSEMENT AND
APPLICATION OF PROCEEDS, INCLUDING ANY INVESTMENT EARNINGS ON
PROCEEDS, THAT MAY BE NECESSARY OR APPROPRIATE FROM TIME TO TIME TO
COMPLY WITH THE CODE AND TO MAINTAIN OR VERIFY THE EXCLUSION FROM
GROSS INCOME FOR FEDERAL INCOME TAX PURPOSES OF INTEREST ON A CAPITAL
LEASE.

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