Ch. 549                                    1995 LAWS OF MARYLAND

(3) All proceeds received from any bonds issued and sold shall be applied
solely [for] TO PAY THE COST OF INFRASTRUCTURE IMPROVEMENTS, INCLUDING:

(i) Costs of design, construction, establishment, extension, alteration,
or acquisition of infrastructure improvements;

(ii) Costs of issuing bonds; [and]

(iii) Payment of the principal and interest on loans, money advances, or
indebtedness incurred by a municipal corporation for any of the purposes stated in
subsection (b)(2) of this section, INCLUDING THE REFUNDING OF BONDS PREVIOUSLY
ISSUED UNDER THIS SECTION; AND

(IV) FUNDING OF A DEBT SERVICE RESERVE FUND OR PAYMENT
OF INTEREST PRIOR TO, DURING, OR FOR A LIMITED PERIOD OF TIME AFTER
CONSTRUCTION.

(e) (1) Before issuing these bonds, the governing body of the municipal
corporation shall:

(i) Designate by resolution [a contiguous] AN area [within its
jurisdiction] OR AREAS as a special taxing district;

(ii) Subject to paragraph (2) of this subsection, adopt a resolution
creating a special fund with respect to the special taxing district; and

(iii) [Levy] PROVIDE FOR THE LEVY OF an ad valorem OR SPECIAL
tax on all real and personal property within the special taxing district at a rate OR
AMOUNT designed to provide adequate revenues to pay the principal of, interest on, and
redemption premium, if any, on the [bonds and] BONDS, to replenish any debt service
reserve fund, [which] AND FOR ANY OTHER PURPOSE RELATED TO THE ONGOING
EXPENSES OF OR SECURITY FOR THE BONDS. AD VALOREM taxes shall be levied in the
same manner, upon the same assessments, for the same period or periods, and as of the
same date or dates of finality as are now or may hereafter be proscribed FOR GENERAL
AD VALOREM TAX PURPOSES WITHIN THE DISTRICT, and shall be discontinued when
all of the bonds have been paid in full. SPECIAL TAXES SHALL BE LEVIED PURSUANT
TO SUBSECTION (N) OF THIS SECTION.

(2) The resolution creating a special fund under paragraph (1)(ii) of this
subsection shall:

(i) Pledge to the special fund the proceeds of the ad valorem OR
SPECIAL tax to be levied as provided under paragraph (1)(iii) of this subsection; and

(ii) Require that the proceeds from the tax be paid into the special
fund.

(f) [(1)]When no bonds authorized by this section are outstanding with respect
to a special taxing district, and the governing body of the municipal corporation so
determines, moneys in the special fund may be paid to the general fund of the municipal
corporation.

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