ROBERT L. EHRLICH, JR., Governor                             Ch. 501

(i) provides efficient and cost-effective collection of taxes; and

(ii) provides two semiannual coupons, two semiannual billing
forms, or a similar method that allows taxpayers to pay on a semiannual basis.

(3) Local semiannual payment schedule collection systems that are not
approved by the Department shall utilize 2 semiannual payment coupons that shall
be submitted with the appropriate payment.

(i) A payment under a semiannual schedule:

(1)     for the first installment:

(i) is due on July 1 of the tax year; and

(ii) may be paid without interest on or before September 30 of the
tax year; and

(2)     for the second installment:

(i) is due on December 1 of the tax year;

(ii) except for the service charge, may be paid without interest on or
before December 31 of the tax year; and

(iii) may be prepaid without the service charge or interest on or
before September 30 of the tax year.

(j) (1) If an escrow account is established for the payment of the property
tax, the escrow account servicer shall pay tax in semiannual installments unless the
escrow account servicer has received written direction from the property owner or
borrower to pay property tax in annual payments.

(2)     If a taxpayer provides written direction to an escrow account servicer
at least 60 days prior to the beginning of the tax year, property taxes shall be paid on
an annual payment basis on behalf of that taxpayer by the escrow account servicer in
the tax year that begins immediately following the year in which the written direction
was received.

(3)     If a taxpayer provides written direction to an escrow account servicer
less than 60 days prior to the beginning of the tax year, property taxes may be paid on
an annual payment basis on behalf of that taxpayer by the escrow account servicer in
the tax year that begins immediately following the year in which the written direction
was received.

SECTION 2. AND BE IT FURTHER ENACTED, That on or before September
30, 2004, the Department of Assessments and Taxation may accept applications for
the taxable year beginning July 1, 2004.

SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take
effect June 1, 2004, and shall be applicable to all taxable years beginning after June
30, 2004.

Approved May 26, 2004.

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