Sec. 68C-6. Issuing Bonds.
Montgomery County, Md., Code § 68C-6 (2026)
Sec. 68C-6. Issuing Bonds.LinkCopy Citation
(a)
Before the County issues any bond payable from ad valorem taxes levied under Section 68C-3, the Council must adopt a resolution authorizing the issuance of bonds that meets the requirements of this Section.
(b)
Each resolution under this Section must:
(1)
describe the types of transportation infrastructure improvements and related costs to be financed; and
(2)
specify the maximum principal amount of bonds to be issued.
(c)
Each resolution may specify, or authorize the Executive by executive order to specify:
(1)
the actual principal amount of bonds to be issued;
(2)
the actual rate or rates of interest for the bonds;
(3)
how and on what terms the bonds must be sold;
(4)
how, when, and where principal of, and interest on, the bonds must be paid;
(5)
when the bonds may be executed, issued, and delivered;
(6)
the form and tenor of the bonds, and the denominations in which the bonds may be issued;
(7)
how any or all of the bonds may be called for redemption before their stated maturity dates;
(8)
the nature and size of any debt service reserve fund;
(9)
the pledge of other assets in and revenues from the District to pay the principal of and interest on the bonds;
(10)
any bond insurance or any other financial guaranty or credit or liquidity enhancement of the bonds; and
(11)
any other provision consistent with the law that is necessary or desirable to finance any transportation infrastructure improvement that has been identified in a Council resolution approved under Section 68C-4.
(d)
(1)
The County must covenant to levy ad valorem taxes against all assessable real and personal property in the District at a rate and amount sufficient in each year when any bonds are outstanding to:
(A)
provide for the payment of the principal of, interest on, and redemption premium if any, on the bonds;
(B)
replenish any debt service reserve fund established with respect to the bonds; and
(C)
provide for any other purpose related to the ongoing expenses of and security for the bonds.
(2)
The County further must covenant, when any bond is outstanding, to enforce the collection of all ad valorem taxes under this Chapter as provided by applicable law.
(e)
All proceeds received from any issuance of bonds must be applied solely towards costs of the transportation infrastructure improvements listed in the resolution adopted under Section 68C-4, including the cost of issuing bonds and payment of the principal of, interest on, and redemption premium if any, on the bonds.
(f)
The bonds issued under this Chapter:
(1)
are special obligations of the County and do not constitute a general obligation debt of the County or a pledge of the County’s full faith and credit or the County’s general taxing power;
(2)
may be sold in any manner, either at public or private sale, and on terms as the Executive approves;
(3)
are not subject to Sections 10 and 11 of Article 31, Maryland Code; and
(4)
must be treated as securities to the same extent as bonds issued under Section 9-1301 of Article 24, Maryland Code.
(g)
To the extent provided by law, the bonds, their transfer, the interest payable on them, and any income derived from them, including any profit realized on their sale or exchange, must be exempt at all times from every kind and nature of taxation by the State of Maryland and any county or municipality in Maryland.
(h)
The bonds must be payable from the fund required under Section 68C-5 and any other asset or revenue of the District pledged toward their payment. When any bond is outstanding, the monies in the fund are pledged to pay the costs of any transportation infrastructure improvement funded entirely or partly by the proceeds of the bonds, including the costs of issuing the bonds and payment of the principal of, interest on, and redemption premium if any, on the bonds. In addition to ad valorem taxes, the bonds may be secured by any other asset in or revenue generated in the District.
(i)
Any ad valorem tax imposed under this Chapter must not be accelerated because of any bond default.