# Housing and Community Development (GHS)

## Title 12. Provisions of Statewide Applicability

### Subtitle 4. Duties of Authorities

#### Section 12-401

(a) It is State policy that an authority:

  (1) shall manage and operate its housing projects efficiently to enable it to fix the rent for housing units at the lowest rates consistent with its providing decent, safe, and sanitary housing units and meeting the financial needs under subsection (b) of this section; but

  (2) may not operate for profit or as a source of revenue to the political subdivision.

(b) An authority shall fix the rents for housing units in its housing projects at rates no higher than it finds necessary to produce revenues that with all other available money, revenue, income, and receipts will be sufficient to:

  (1) pay the principal and interest on bonds of the authority, as they become due;

  (2) pay and provide for maintaining and operating the housing projects, including the cost of insurance and the administrative expenses of the authority;

  (3)

    (i) create during a period of at least 6 years right after it issues any bonds, a reserve that can meet the largest principal and interest payments that will be due on the bonds in any year thereafter; and

    (ii) maintain the reserve;

  (4) create reserves for operations, emergencies, renovations, replacements, and the repayment of debt; and

  (5) create funds necessary or desirable to:

    (i) subsidize rents;

    (ii) develop or operate housing projects; or

    (iii) operate or provide services located in housing projects or that otherwise benefit their residents.

#### Section 12-402

Except for rental units that may be occupied by others under Sec. 12-503(a)(4) of this title, an authority:

(1) shall rent the housing units in a housing project only:

  (i) to persons of eligible income, except for a reasonable number of housing units that may be occupied by management and security personnel; and

  (ii) at rentals within the financial reach of persons of eligible income;

(2) may not accept a person as a tenant in a housing project if the aggregate annual income of the person or persons who would occupy the housing unit exceeds the maximum income level established for persons of eligible income; and

(3) shall prohibit subletting by tenants.

#### Section 12-403

Except as provided in Sec. 12-506(b)(9) of this title, all housing projects of an authority are subject to the planning, zoning, sanitary, health, fire, housing, subdivision, and building laws, ordinances, codes, rules, and regulations that apply where the housing project is located.

#### Section 12-404

(a) At least annually, an authority shall file with the custodian of records a financial report of its activities for the preceding year and recommend any further action by the political subdivision that it considers necessary or useful to carry out the purpose of this Division II.

(b) The political subdivision may require an authority to provide it with an annual operating budget and program reports that the political subdivision designates.

(c) The political subdivision or its designee may at any time:

  (1) examine the books and records of the authority; or

  (2) conduct an audit of the authority.

#### Section 12-405

This subtitle does not limit the power of an authority to vest in an obligee the right, if the authority defaults, to:

(1) take possession of a housing project;

(2) have a receiver of a housing project appointed; or

(3) acquire title to a housing project, through foreclosure or otherwise, free from all restrictions of this subtitle.

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Md. Code Ann., Hous. & Cmty. Dev. (as displayed at mgaleg.maryland.gov, October 16, 2026)