In this subtitle the following words have the meanings indicated. “Business project” means a project that qualifies under § 4–223 of this subtitle. “Commercial building” means any building that: is used primarily to carry on a business whether or not for profit; is not a residential building; and is not used primarily to manufacture or produce raw materials, products, or agricultural commodities. “Commercial energy audit” means: an energy audit performed for purposes of Title VII of the National Energy Conservation Policy Act, 42 U.S.C. §§ 6201 through 6422; or an onsite inspection of a commercial building that includes a determination of, and provides information on: the type, quantity, and rate of energy consumption of the building; the maintenance and operation procedures to reduce the energy consumption of the building; and the cost of implementing an appropriate energy conservation project, a solar energy project, or both, and the savings in energy costs likely to result from the project. “Community development project” means a project that qualifies under § 4–217 of this subtitle. “Development costs” means the costs that the Department considers reasonable and necessary to carry out: a community development project; an energy conservation project; a home improvement project; an infrastructure project; a public purpose project; a solar energy project; a special housing facility; or a business project. “Development costs” includes: the costs of: studies, surveys, plans and specifications, and architectural, engineering, or other special services; acquisition of land and any buildings on the land; site preparation and development, construction, reconstruction, rehabilitation, and improvement; and acquisition of machinery, equipment, and furnishings; expenses incurred in connection with initial occupancy or operation of the project; an allocable portion of the administrative and operating expenses of the Department; the cost of financing the project, including interest on bonds and notes issued to finance the project from the date issued to the date the Department determines that the project is substantially occupied or substantially in operation; the cost of other items, including indemnity and surety bonds, premiums on insurance, fees, relocation costs, and charges and expenses of trustees, depositories, and paying agents for bonds and notes issued; and operating and expansion costs for business projects. “Director” means the Director of the Administration. “Energy conservation project” means a project that qualifies under § 4–218 of this subtitle. “Family of limited income” means a family or individual whose income does not exceed the upper income limits established by the Secretary under § 4–212 of this subtitle. “Home improvement project” means a project that qualifies under § 4–219 of this subtitle. “Infrastructure project” means a project that qualifies under § 4–220 of this subtitle. “Limited dividend corporation” means a corporation that: qualifies as a limited dividend corporation under the Moderate–Income Rental Program of the National Housing Act, Title 12, Chapter 13 of the United States Code; and is operated only to further a community development project. “Local development agency” means the governmental unit of a political subdivision that the chief executive officer of the political subdivision designates to carry out community development under this subtitle. “Local development entity” means a corporation or foundation, no part of the net earnings of which inures to the benefit of a private shareholder or individual, that is organized and operated primarily to foster, encourage, and assist community development in the State. “Local obligation” means a bond, note, or other obligation of a political subdivision or a governmental unit of a political subdivision. “Public purpose project” means a project that qualifies under § 4–221 of this subtitle. “Residential building” means a single family or multifamily structure that is used primarily for human dwelling and that has a system for heating, cooling, or both. “Residential energy audit” means: an inspection or energy audit of a residential building or a dwelling unit in a residential building performed for purposes of Title II or Title VII of the National Energy Conservation Policy Act, Title 42, Chapter 91 of the United States Code; or an onsite inspection of a residential building or a dwelling unit in a residential building that includes a determination of and provides information on: the type, quantity, and rate of energy consumption of the building or dwelling unit; maintenance and operating procedures to reduce the energy consumption of the residential building or dwelling unit; and the cost of implementing an appropriate energy conservation project, solar energy project, or both, and the savings in energy costs that are likely to result from the project. “Residential mortgage loan” means a loan, including a temporary loan or advance, that is secured by a mortgage of real property in the State that is: improved by a residential building; or unimproved, if the loan proceeds are to be used to construct a residential building. “Solar energy project” means a project that qualifies under § 4–222 of this subtitle. “Special housing facility” means a project or undertaking for the refinancing, acquisition, rehabilitation, improvement, renovation, or construction of a building that: will be occupied in substantial part by families of limited income; will provide common, shared, or independent living, dining, kitchen, sanitary, and sleeping facilities; may include supportive services or supervisory live–in personnel for individuals with specialized housing needs; may include nonresidential facilities to serve individuals with special needs who need not be residents of the project or undertaking; and is not subject to § 4–213(b) of this subtitle. “Sustainable community” has the meaning stated in § 6–201 of this article.

The General Assembly finds that: in this era of rapid population growth and expansion and of increasing urbanization, there is a need in many areas of the State to promote sound community development; the political subdivisions do not have adequate resources to deal effectively with all of the problems of sound community development, and the ordinary operations of private enterprise cannot deal with them without State assistance; there is a need to coordinate and concentrate federal, State, regional, and local public and private community development efforts and resources; there is a shortage of adequate, safe, and sanitary housing for families of limited income, and increasing the housing supply for families of limited income will ease the shortage and promote sound community development; increasing opportunities for homeownership is desirable and promotes sound community development; reducing energy consumption and increasing the use of solar energy by providing financial assistance to encourage energy conservation and solar energy improvements to residential buildings and commercial buildings promote sound community development and the public interest; the public infrastructure maintained by political subdivisions, including streets, sidewalks, curbs, sewer and water systems, bridges, and public buildings, needs rehabilitation and construction; the resources necessary for financing infrastructure projects have become scarcer in recent years; providing an additional, accessible, and uncomplicated mechanism to finance infrastructure projects promotes sound community development, is vital to a strong economy, improves the quality of the environment, and otherwise promotes the health, safety, and welfare of the residents of the State; promoting sound community development is a proper public purpose and State use, for which public money may be spent and property may be acquired; and the functions and responsibilities of the Administration set forth in this subtitle are necessary to achieve the ends listed in this section.

To attract and retain teachers in the State by increasing homeownership opportunities, the General Assembly finds that there is a need to authorize the Department to develop a program to dedicate up to $25,000,000 over 5 years to provide mortgage loans to teachers at interest rates below the prevailing interest rate for similar programs. A mortgage loan under this section shall be available to a teacher who is a first–time home buyer. The loan shall be conditioned on an agreement by the teacher to teach in the State for at least 3 years if work is available for the teacher. The loan shall be used to purchase property in a priority funding area as defined in §§ 5–7B–02 and 5–7B–03 of the State Finance and Procurement Article. The Administration shall develop the program in consultation with: the State Department of Education, to ensure that the program is consistent with the State’s strategy to attract and retain teachers; and local boards of education, to ensure that the program is properly marketed.

There is a Community Development Administration.

The Administration is created to: coordinate activities and programs that contribute to sound community development; encourage and facilitate the development of new and existing communities by reducing the costs of development through grants, loans, and other forms of financial assistance; encourage and facilitate energy conservation and the use of solar energy in residential buildings and commercial buildings through grants, loans, and other forms of financial assistance; make land available for sound community development; and assist the efforts of private enterprise, political subdivisions, local public agencies, local development entities, and nonprofit organizations.

Except as provided in subsection (b) of this section, a grant of land or money may be made only to a political subdivision, a local development entity, a local development agency, or a nonprofit organization. This section does not apply to grants that may be awarded to the Administration under federal law. The Administration may award grants to home buyers for settlement expenses as provided by the Department under this title. The Administration may award grants under § 4–235(b)(1)(ii) of this subtitle.

With the approval of the Governor, the Secretary shall appoint the Director. The Director serves at the pleasure of the Secretary. The position of Director is in the executive service or management service of the State Personnel Management System. The Director shall operate and exercise the powers of the Administration under the direction of the Secretary and in accordance with this subtitle. The Director is entitled to: compensation as provided in the State budget; and reimbursement for expenses under the Standard State Travel Regulations as provided in the State budget. The Director shall have a staff and professional consultants as provided in the State budget.

There is a Housing Finance Review Committee. The Housing Finance Review Committee consists of seven members appointed by the Governor on recommendation of the Secretary as follows: three employees of the Department, one of whom may be the Secretary; one employee of the Executive Branch of State government who is not employed by the Department; and three members of the public. The term of a public member is 4 years and begins on July 1. At the end of a term, a public member continues to serve until a successor is appointed and qualifies. A public member who is appointed after a term has begun serves only for the rest of the term and until a successor is appointed and qualifies. The Housing Finance Review Committee shall review and make recommendations to the Secretary about: specific loan requests or categories of loan requests; and the investment and project financing policies of the Administration. The Secretary may approve a specific loan request without a recommendation of the Housing Finance Review Committee if the request requires urgent action.

The Administration shall: assist the Governor in coordinating the activities of governmental units of the State that affect the solution of community development problems and the implementation of community plans; encourage and assist political subdivisions to develop mutual and cooperative solutions to their common problems; serve as a clearinghouse for information and other materials that may be pertinent to sound community development, including information on available federal, State, and private financial and technical assistance; carry out continuing studies and analyses of sound community development in cooperation with the Department of Planning; make recommendations, in cooperation with the Department of Planning, for administrative or legislative action, paying particular attention to the problems of metropolitan, suburban, and other areas; implement model or demonstration programs and projects, contract to administer functions or services in a political subdivision, or otherwise provide a program of practical research in community development; promote community development by giving to political subdivisions, local development agencies, local development entities, or nonprofit organizations: technical assistance and advisory, consultative, training, and educational services; and grants and loans to pay for: the services and technical assistance; and any development costs; contract for and accept from the federal government a grant, contribution, or loan of money, property, or other aid in any form for community development; and do all things necessary to qualify for the grant, contribution, or loan, including those things necessary to qualify for assistance as a local public agency or public housing agency under a federal housing or renewal program; contract for and accept from any governmental unit of the State or other source a gift, grant, contribution, or loan of money, property, or other aid in any form for community development and comply with the terms and conditions of the gift, grant, contribution, or loan; attach to a sale or lease of property or to a loan or grant the terms and conditions that the Director determines and the Secretary approves; enter into agreements to make annual payments instead of assessments, charges, or property taxes to a political subdivision in respect to real property that the Administration owns; and provide money to programs eligible to receive funding from the Neighborhood Business Development Fund under § 6–310 of this article. To implement community development projects and public purpose projects in accordance with Part V of this subtitle, and subject to §§ 4–213(b) and 4–214 of this subtitle, the Administration may: acquire, own, and hold land that is open, mainly open, or undeveloped, or any interest in the land; install access and interior streets and roads and sewer and water lines in or to the land and otherwise improve the land; or transfer, lease, mortgage, or otherwise dispose of or encumber the land; acquire, own, and hold land that is not open, mainly open, or undeveloped, as well as personal or mixed property; manage and operate the property; clear, improve, construct, or rehabilitate the property; transfer, lease, mortgage, or otherwise dispose of or encumber the property; or take assignments of rentals or leases for the property; arrange or contract with a political subdivision or private party in connection with a community development project or public purpose project for: planning, replanning, zoning, or rezoning; opening, grading, or closing streets, roads, alleys, or other places; furnishing facilities; acquiring property or property rights by the political subdivision; or furnishing property or services; and spend Administration money for an undertaking that the Secretary approves. The Administration shall develop and implement a weatherization program to provide money for insulation materials and insulation costs to households that qualify based on income and the program eligibility guidelines that the Secretary establishes. In this subsection the following words have the meanings indicated. “Covered building” has the meaning stated in § 2–1601 of the Environment Article. “Energy conservation project” means a project that qualifies under § 4–218 of this subtitle. For the purpose of reducing direct greenhouse gas emissions from multifamily residential buildings in accordance with the standards adopted under § 2–1602 of the Environment Article, the Administration shall develop and implement a program to provide grants and loans for energy conservation projects and projects to install renewable energy generating systems in covered buildings that house primarily low– to moderate–income households. Grants and loans provided under this subsection may not be used for a project to install new equipment that uses fossil fuels or improve the efficiency of existing equipment that uses fossil fuels. In each of fiscal years 2024 through 2026, the Governor shall include in the annual budget bill an appropriation of $5,000,000 to the Department for the purpose of providing grants and loans under this subsection. On or before December 1, 2023, and each December 1 thereafter, the Administration shall report to the Governor and, in accordance with § 2–1257 of the State Government Article, the General Assembly on the projects funded under this subsection.

In establishing the upper income limits for a family of limited income, the Secretary shall consider factors including: the income of the family available for housing; the size of the family; the cost and condition of available housing; the ability of the family to compete in the private housing market; and standards and definitions established for federal housing programs. The limits established under subsection (a) of this section may vary for different: types of housing; programs of the Administration; and areas of the State. A limit established under subsection (a) of this section may be supplemented for a particular project.

In accordance with regulations that the Secretary adopts, an agreement that the Administration makes to carry out its functions and responsibilities under §§ 4–211, 4–214, and 4–225 through 4–235 of this subtitle shall be approved by: the Secretary; and the Board of Public Works, if its approval is required by law. The Administration shall provide written notice and a reasonable opportunity to comment to the chief executive officer or the equivalent officer and the head or president of the legislative body of the political subdivision in which a proposed community development project or a public purpose project is located. If the proposed project is located in a municipal corporation, the notice required under subsection (b) of this section shall be sent to the chief executive officer and head or president of the legislative body of the municipal corporation and not to the county. A project that the Administration finances is subject to applicable zoning and building codes. This subsection applies notwithstanding any other provision of this subtitle or other State law. In exercising its functions and responsibilities, the Administration may sell or lease for a term not exceeding 99 years all or part of the real, mixed, or personal property constituting a community development project. A sale or lease under this section may be made: without public bidding or public sale; and on terms and conditions that make housing in that development economically feasible for families of limited income. A sale or lease under this section shall conform with a plan for community development that the Secretary approves at a public hearing held after notice is published in at least one newspaper of general circulation in the political subdivision in which the development is located. The plan for community development presented at the hearing shall be in accordance with regulations that the Secretary adopts, requiring: a description of the property; a statement of the identity of the proposed purchaser or lessee and the proposed use or reuse of the property; the price or rental to be paid by the purchaser or lessee; and the conditions of the sale or lease that ensure that the community development purposes of this subtitle will be carried out. In carrying out this subtitle, the Administration shall comply with local laws applicable to the community development project. In carrying out this subtitle, the Administration shall: foster local initiative and participation in community development activities; and consider local and regional goals and policies as expressed in urban renewal, community renewal, and local comprehensive land use plans and regional plans. Wherever possible, the Administration shall carry out community development projects together with and through the use of: private enterprise; limited dividend corporations; local development agencies; and local development entities.

The Administration has the power of eminent domain, but may not exercise it in a political subdivision without the consent of the political subdivision given by ordinance of its governing body for a specific community development project.

The Administration shall administer a home buyer assistance program that: assists home buyers to receive low–interest mortgage loans, with down payment and closing cost assistance options, for the purchase of homes near their place of employment; and coordinates with, and matches where appropriate, similar programs offered by private employers and county and municipal governments so as to maximize the total amount that home buyers can receive under the program. With reference to loans under this program, the Administration shall: allow home buyers to utilize the loans for the purchase of newly constructed or existing homes; and require a home purchased under this program to be occupied by the home buyer as a principal residence. The Administration shall facilitate the marketing of the program with private employers and county and municipal governments, and, where appropriate, other units of State government and nonprofit organizations. The Administration shall adopt regulations to implement the program established under this section. The Department shall report to the General Assembly on or before December 31 each year, in accordance with § 2–1257 of the State Government Article, on the program established under this section.

In this section the following words have the meanings indicated. “Current student” means an individual who: attends a public institution of higher education in the State; and is a degree–seeking, full–time equivalent student in an undergraduate level, graduate level, or professional degree program. “Public institution of higher education” has the meaning stated in § 10–101 of the Education Article. “Recent graduate” means an individual who, within 5 years before applying for assistance under this section, graduated from a public institution of higher education in the State with at least: 120 credits in an undergraduate level program; or 30 credits in a graduate level or professional degree program. The Administration may administer a home buyer assistance program that: assists current students and recent graduates to receive low–interest mortgage loans, with down payment and closing cost assistance options, for the purchase of homes near the school attended by the student or graduate; coordinates with, and matches where appropriate, similar programs offered by public institutions of higher education, private employers, and county and municipal governments to maximize the total amount that current students and recent graduates can receive under the program; authorizes a public institution of higher education to provide matching funds to a home buyer who receives assistance under this section; and utilizes available funding sources. With reference to loans under this program, the Administration may: allow home buyers to utilize the loans for the purchase of newly constructed or existing homes; require a home purchased under the program to be occupied by the home buyer as a principal residence; and utilize available funding sources. The Administration may facilitate the marketing of the program with public institutions of higher education, private employers, county and municipal governments, and, where appropriate, other units of State government and nonprofit organizations with existing funding for the marketing of current programs of the Department, if available. The Administration shall adopt regulations to carry out this section. On or before December 31 each year, the Department shall report to the General Assembly, in accordance with § 2–1257 of the State Government Article, on the program established under this section.

For fiscal year 2018 and each fiscal year thereafter, the Governor shall include in the annual budget bill or the capital budget bill an appropriation of $3,000,000 from general funds or the proceeds from the sale of State general obligation bonds for the Shelter and Transitional Housing Facilities Grant Program.

A project, undertaking, or a part of a project or undertaking, including the real, personal, and mixed property involved, qualifies as a community development project if it is planned, acquired, owned, developed, constructed, reconstructed, rehabilitated, repaired, renovated, or improved to promote sound community development. A community development project shall provide for: new or existing housing: that is or will be occupied in substantial part by families of limited income; or at least 20% of which is or will be occupied by families of limited income, if the project is financed with bonds, notes, or other evidences of indebtedness issued by the Administration, the income from which being includable in the holder’s gross income under the Internal Revenue Code as determined by the Administration at the time of issue; any improvements, such as streets, roads, sewer lines, and water lines that are needed to support the housing; and the public or private commercial, educational, cultural, recreational, community, or civic facilities that are needed to support the housing. A community development project may include public or private commercial, educational, cultural, recreational, community, or civic facilities that are not needed to support the housing, if: they are less than a substantial part of the project; or the Secretary finds that they will promote sound community development. The Administration shall administer community development projects that: are in sustainable communities approved under § 6–305 of this article; and provide employees with financial assistance in the form of grants to buy homes near their workplaces. A community development project administered under this subsection is not subject to the provisions of subsection (b)(1) of this section that require part of the housing to be occupied by families of limited income. The community development projects administered under this subsection shall be known as the “Live Near Your Work” program. The Secretary shall adopt regulations to implement the “Live Near Your Work” program established under this subsection. In fiscal year 2007 and fiscal year 2008, the Governor may include in the State budget $250,000 for the “Live Near Your Work” program established under this subsection. In fiscal year 2009 and every fiscal year thereafter, the Governor may include in the State budget no less than $250,000 and no more than $500,000 for the “Live Near Your Work” program established under this subsection. In this subsection the following words have the meanings indicated. “Current student” means an individual who: attends a public institution of higher education in the State; and is a degree–seeking, full–time equivalent student in an undergraduate level, graduate level, or professional degree program. “Public institution of higher education” has the meaning stated in § 10–101 of the Education Article. “Recent graduate” means an individual who, within 5 years before applying for assistance under this section, graduated from a public institution of higher education in the State with at least: 120 credits in an undergraduate level program; or 30 credits in a graduate level or professional degree program. The Administration may administer community development projects that: are in sustainable communities approved under § 6–305 of this article; and provide current students and recent graduates with financial assistance in the form of grants to buy homes near the school of the student or graduate. A community development project administered under this subsection is not subject to the provisions of subsection (b)(1) of this section that require part of the housing to be occupied by families of limited income. The community development projects administered under this subsection shall be known as the Live Near Your School program. The Administration shall adopt regulations to implement the Live Near Your School program established under this subsection.

A project for a residential building qualifies as an energy conservation project if it consists of: the purchase or installation of: caulking or weather stripping; a clock thermostat; ceiling, attic, wall, floor, or duct insulation; water heater insulation; a storm window or door, multiglazed window or door, or heat–absorbing or heat–reflecting window or floor material; a device associated with load management techniques; an automatic energy control system; machinery, equipment, or a facility that uses groundwater as a heat source for a heating system or as a heat sink for an air conditioning system; a furnace efficiency modification, including: a replacement burner, furnace, or boiler or any combination of them that increases the energy efficiency of the heating system; a device for modifying a flue opening that increases the energy efficiency of the heating system; and an electrical or mechanical furnace ignition system that replaces a standing gas pilot light; and any other energy conservation improvement that the Administration determines by regulation to be appropriate and consistent with this subtitle; or a planning or technical service, a residential energy audit, or a conversion from a master utility meter to individual utility meters if the service, audit, or conversion is related to or undertaken with the installation of an item specified in item (1) of this subsection. A project for a commercial building qualifies as an energy conservation project if it consists of: the purchase, installation, or modification of an installation that is designed primarily to reduce the consumption of energy, including: caulking or weather stripping; insulating the building structure or a system in the building; a storm window or door, a multiglazed window or door, a heat–absorbing or heat–reflecting window or door system, glazing, a reduction in glass area, or another window or door system modification; an automatic energy control system; equipment that is associated with an automatic energy control system and that is required to operate a variable steam, hydraulic, or ventilation system; the replacement or modification of a lighting system to increase energy efficiency without increasing the overall illumination, unless the increase in illumination is necessary to conform to State or local law; an energy recovery system; a cogeneration system; machinery, equipment, or a facility that uses groundwater as a heat source for a heating system or as a heat sink for an air conditioning system; a modification of a furnace or utility plant and distribution system including: a replacement burner, furnace, or boiler or any combination of them that increases the energy efficiency of the heating system; a device for modifying a flue opening that increases the energy efficiency of the heating system; and an electrical or mechanical furnace ignition system that replaces a standing gas pilot light; or any other energy conservation improvement that the Administration determines by regulation to be appropriate and consistent with this subtitle; or a planning or technical service or a commercial energy audit, if the service or audit is related to or undertaken with the installation, or the modification of an installation, of an item specified in item (1) of this subsection.

A project or undertaking qualifies as a home improvement project if, by improvement, alteration, addition, or repair, it substantially protects or improves the basic liveability of a residential building that will be occupied in substantial part by families of limited income. A home improvement project for a residential building that contains more than four dwelling units is subject to the provisions of this subtitle that apply to a community development project.

This section does not apply to a facility if a local obligation that finances the facility is a private activity bond under § 141 of the Internal Revenue Code, for which an allocation under § 146 of the Internal Revenue Code is required. A project, undertaking, or facility qualifies as an infrastructure project if it is planned, acquired, owned, developed, constructed, reconstructed, rehabilitated, or improved by or on behalf of a political subdivision to provide the essential physical elements that are the basis of the public service system. Infrastructure projects include streets, sidewalks, curbs, sewer and water systems, bridges, and public buildings that are owned by a political subdivision or a governmental unit of a political subdivision.

A project or undertaking, including the real, personal, and mixed property involved, qualifies as a public purpose project if it is planned, acquired, owned, developed, constructed, reconstructed, rehabilitated, repaired, renovated, or improved with the financial assistance of the Administration or the assistance of federal low-income housing credits authorized by the Internal Revenue Code, and it is: eligible wholly or partly for federal low-income housing credits; or located in a distressed area designated under subsection (e) of this section. Except as provided in subsection (c) of this section, a public purpose project: shall provide in substantial part for existing or new housing; and may include: any improvements, such as streets, roads, sewer lines, and water lines; and public or private commercial, educational, cultural, recreational, community, or civic facilities. A public purpose project may include a greater proportion of public or private facilities if the Secretary determines that to do so would promote sound community development. All or part of the housing portion of a public purpose project shall be occupied by families of limited income. At the request of a political subdivision, the Secretary may designate a distressed area of the political subdivision after considering factors including: the availability, cost, and condition of housing and neighborhood facilities, including the age and number of abandoned and substandard structures; the incomes of residents relative to State or area-wide regional median incomes, including the number of individuals who are welfare recipients, unemployed, or living in poverty; the need to finance housing or public or private facilities to upgrade the social and economic conditions of the distressed area; the plans and financial commitment of the political subdivision to undertake improvements in the distressed area; and other standards and criteria that the Secretary considers relevant, including standards established for other State or federal programs.

A project qualifies as a solar energy project if it: is an addition, alteration, or improvement to a residential building or a commercial building; and is designed to reduce the energy requirements of the building by using: wind energy; energy from a wood-burning appliance; or solar energy of: the active type based on mechanically forced energy transfer; the passive type based on convective, conductive, or radiant energy transfer; or a combination of these types. A solar energy project may include: a solar process heat device; a solar electric device; and an earth–sheltered building in which the sheltering substantially reduces the consumption of energy by the building. A solar energy project may not include a fireplace, unless the fireplace is an integral part of a system designed to use passive solar energy.

A project qualifies as a business project if the project is: located in: an area designated as a priority funding area under § 5–7B–02 of the State Finance and Procurement Article; or a qualified opportunity zone designated under § 1400Z–1 of the Internal Revenue Code in Allegany County, Baltimore City, Baltimore County, Charles County, Garrett County, Howard County, Montgomery County, Prince George’s County, Somerset County, or Wicomico County; and acquired, owned, developed, constructed, reconstructed, rehabilitated, or improved by a person or an entity for the purposes of carrying on a business whether or not for profit; or eligible for funding from the Neighborhood Business Development Fund under § 6–310 of this article. Repayment of principal and interest for a business project may be secured by: real property; personal property; bank accounts; certificates of deposit, stocks, and bonds; credit enhancement, assurance, or guaranty; or any other collateral acceptable to the Administration. Financial assistance for a business project may be provided as: a loan; a reduction in the principal obligation of or interest rate on a loan or portion of a loan; a prepayment of interest on a subordinate or superior loan or portion of a loan; an assurance; a guarantee or other form of credit enhancement; or a promissory note that may be converted to an equity ownership interest and liquidated at the earliest opportunity to realize the highest market value for the Administration.

The Administration shall administer a program of financial assistance for: community development projects; energy conservation projects; home improvement projects; public purpose projects; solar energy projects; special housing facilities; and business projects. The Administration shall provide financial assistance for projects and facilities under this section with money that the Administration can get for them from any source, including: payments under federal law; bonds or notes issued by the Administration; bonds or notes issued by the State; and mortgage-backed securities and proceeds of investments in them. A loan for a home improvement project having a principal balance exceeding $5,000 shall be secured by a mortgage. Subject to an agreement with noteholders or bondholders, the Administration may consent that a loan, loan commitment, or agreement to which the Administration is a party be modified as to: the interest rate; the time of payments of an installment of principal or interest; security; or any other term.

In connection with property on which it holds a mortgage, the Administration may: foreclose on the property; begin an action to protect or enforce a right conferred on the Administration by law or any agreement; bid for and purchase the property at a foreclosure or other sale; and acquire and take possession of the property. In an action under this subsection, the Administration may: complete, administer, and pay the principal of and interest on an obligation incurred in connection with the property; and dispose of and otherwise deal with the property, so as to protect the interests of the Administration. This subsection does not apply to a lien held in connection with a public purpose project. The Administration may not lend money on the security of property unless the lien on the property is superior to all other liens, except for: a lien for taxes owed to the State or a political subdivision; or an earlier mortgage lien. At public or private sale and with or without public bidding, the Administration may sell a mortgage or other obligation that the Administration holds. The Administration may retain the servicing rights and charge servicing fees for any mortgage or other obligation the Administration sells.

The Administration shall coordinate the promotion of its programs of financial assistance for energy conservation projects with the energy conservation promotion programs of the Maryland Energy Office. The Administration shall adopt regulations to establish and implement programs of financial assistance for energy conservation projects and solar energy projects. These regulations shall be consistent with the provisions of this subtitle that generally concern the powers of the Administration to award financial assistance for energy conservation projects and solar energy projects. The regulations shall include provisions about: eligibility and application requirements; interest rates, maximum loan amounts, and the terms of loans; allocations of money among classes of eligible buildings; credit and underwriting requirements; and warranties, representations, forms of security, certifications, inspections, audits, and any other means of ensuring compliance with and enforcing the terms of financial assistance awarded under this subtitle.

To finance infrastructure projects, the Administration may: make, purchase, and participate in making loans; purchase local obligations issued to finance such projects; and provide any other form of financial assistance other than grants. All transactions under subsection (a) of this section shall be evidenced by instruments containing the terms and conditions necessary to secure payment of all obligations and charges due to the Administration. Subject to an agreement with holders of its bonds, notes, or other obligations, the Administration may consent that a loan, local obligation, commitment, instrument, or agreement that the Administration holds or to which it is a party may be modified as to: interest rate; time of payment of any installment of principal or interest; security; or any other term. In connection with any security that it receives or owns, including a local obligation, the Administration may: sue to protect or enforce its rights under any law or agreement; or acquire or take possession of the security. If the Administration begins such an action, it may: administer the security; pay the principal and interest on any obligation incurred in connection with the security; dispose of the security; and otherwise deal with the security so as to protect the Administration’s interests. The Administration may sell a loan, agreement, local obligation, or other obligation that it holds at public or private sale with or without public bidding.

If the Administration purchases a local obligation, the procedures and requirements for the issuance or sale of the local obligation shall be as provided in §§ 4–230 through 4–233 of this subtitle. Notwithstanding any other public general law or public local law, charter, or ordinance, an issuer of a local obligation may sell a local obligation to the Administration to finance an infrastructure project: at private or public sale, with or without public bidding; without limitation on the denomination of the local obligation; and at any interest rate, cost, or price that the issuer considers necessary or desirable. The issuer of a local obligation may pay any fee or charge necessary for the Administration to: sell bonds, notes, or other obligations of the Administration; provide the financial assistance authorized by § 4–228 of this subtitle; provide any other guarantee, credit enhancement, or additional security for a note, bond, or obligation of the Administration; or insure obligations of the issuer or of the Administration. Notwithstanding any other public general law, public local law, charter, or ordinance, to enhance the security or the marketability of the bonds, notes, or obligations of the Administration that are sold to finance an infrastructure project: a political subdivision may agree with the Administration to pledge any money, including a share of income tax, that the political subdivision is entitled to receive from the State; and if a political subdivision is a county, the county may agree with the Administration to pledge, on behalf of a municipal corporation located in the county, any money, including a share of income tax, that the county is entitled to receive from the State. In accordance with a pledge under paragraph (1) of this subsection, the Comptroller and the State Treasurer shall cause the money pledged to be paid to the Administration or a trustee that the Administration designates.

Notwithstanding any other public general law, or public local law, charter, or ordinance, a political subdivision or a governmental unit of a political subdivision may issue a local obligation to be purchased by the Administration for infrastructure projects. A local obligation shall be issued in accordance with this section. Each local obligation must be authorized by resolution or ordinance of the governing body of the issuer. Before a local obligation is issued under this section: the issuer shall publish a notice of the proposed issuance in a newspaper of general circulation in the jurisdiction of the issuer; and the governing body of the issuer shall hold a public hearing on the proposed issuance. The notice shall include the proposed amount of the issue, the nature of the infrastructure project to be financed, the time and place of the public hearing, and the name and address of the governing body where written comments may be sent.

A resolution or ordinance that authorizes a local obligation shall contain: a statement of the public purpose for which the proceeds of the local obligation are to be spent; the form of the local obligation, including: each place and time of payment; each interest rate or maximum interest rate; the titles of the officials whose signatures shall be on it; a reference to this part as the authority for issuing it; and the taxes or special revenues from which the principal and interest will be payable; a provision for the disposition of the proceeds of sale of the local obligation; a provision that the principal and interest shall be payable to the Administration or its designee; a provision for payment of the principal and interest that specifies each source of payment; a provision that the local obligation is a valid and binding obligation of the issuer in accordance with its terms even if an official whose signature appears on the local obligation: ceases to be an official before the local obligation is delivered; or becomes an official after the date of the issue; and any other provision that is not inconsistent with this subsection and that the governing body of the issuer considers appropriate, including a provision that: the chief elected official of the issuer may modify the forms adopted by the resolution or ordinance without altering the substance of the forms; the official signatures and seals to be affixed to a local obligation may be imprinted in facsimile, except for the signature of the clerk or secretary of the issuer, which shall be affixed manually; subject to terms that the Administration specifies, if the local obligation contains a statement of redemption provisions that is acceptable to the Administration all or a portion of a local obligation is redeemable at the option of the issuer at any time before maturity at the price, at or above the par value of the local obligation, that is acceptable to the Administration and set in the enabling resolution or ordinance; and a local obligation may be in any denomination that is acceptable to the Administration and shall be in fully registered form. A provision under subsection (a)(5) of this section is a covenant binding the issuer to provide the money from the specified source or sources when principal and interest become due and payable. A local obligation that an issuer issues under this part shall have all the attributes of a negotiable instrument under § 19–224 of the Local Government Article. The principal of and interest on a local obligation in the hands of its owner are exempt from taxation by the State or a political subdivision.

Each ordinance or resolution enacted under this section: shall be adopted by the governing body of the issuer; shall be approved by the chief executive officer, if any, of the issuer; and shall have the force of law. Except as provided in subsection (b) of this section, an ordinance, a resolution, or the question of the issuance of local obligations authorized by an ordinance or resolution need not be submitted to a referendum of the qualified voters of the issuer. The qualified voters of a political subdivision may petition to referendum an ordinance or resolution that authorizes the issuance of local obligations, if: the charter of the political subdivision authorizes the voters to do so; and the petition is filed not later than 20 days after the ordinance or resolution is adopted by the governing body of the political subdivision. An ordinance or resolution authorizing the issuance of local obligations: may be adopted at the public hearing required under § 4-230(b) of this subtitle or at another regular or special session of the governing body; and shall be effective on the date adopted and approved.

Each issuance by a municipal corporation of a local obligation under § 4–230 of this subtitle may be secured by a pledge from the county in which the municipal corporation is located. To secure a local obligation under § 4–230 of this subtitle, a county may pledge on behalf of a municipal corporation located in the county: the faith and credit of the county; or specific revenue of the county. A pledge by a county under this section shall be authorized by an ordinance or a resolution of the county. Each ordinance or resolution enacted under this section shall: be adopted by the governing body of the county; be approved by the chief executive officer, if any, of the county; and have the force of law. Subject to paragraph (2) of this subsection, if a local obligation is secured under this section by a pledge of the faith and credit of a county to make prompt payment from the tax and other revenues described in the enabling resolution or ordinance: the pledge is a covenant to levy taxes sufficient to pay the principal of and interest on the local obligation when due: on all real and tangible personal property that is within the corporate limits of the county and subject to assessment for unlimited ad valorem taxation; and in each year in which the local obligation is outstanding; and if at the time of issuance of a local obligation there is a charter or statutory limit on the power of the county to levy property taxes, the pledge is a covenant to levy ad valorem taxes, within that limit, sufficient to pay the principal of and interest on the local obligation: on all real and tangible personal property that is within the corporate limits of the county and subject to assessment for ad valorem taxation; and in each year in which the local obligation is outstanding. A county may not make a pledge under this section if the pledge would cause the county to exceed any limit set, by the charter of the county or by statute, on the power of the county to make the pledge. Notwithstanding subparagraph (i) of this paragraph, a limit on the power of a county to make a pledge that is imposed after the issuance of a local obligation that is secured by a pledge under this section does not affect that local obligation. If a local obligation is secured under this section by a pledge of specific revenue of a county, the specific revenue of the county may include: payments to the issuer from the State or federal government; special benefit assessments, taxes, fees, or service charges that the county has authority to impose, levy, or charge; and revenue of the county expected to be generated by the infrastructure project to be financed.

Each issuance of a local obligation under § 4-230 of this subtitle shall be secured by, at the discretion of the Administration, a pledge of the faith and credit of the issuer or a pledge of specific revenue of the issuer or the facility being financed as designated and described in the authorizing ordinance or resolution. If a local obligation is secured by a pledge of the faith and credit of the issuer to make prompt payment from the tax and other revenues described in the enabling resolution or ordinance: the pledge is a covenant to levy taxes sufficient to pay the principal of and interest on the local obligation when due: on all real and tangible personal property that is within the issuer’s corporate limits and subject to assessment for unlimited ad valorem taxation; and in each year in which the local obligation is outstanding; if at the time of issuance of a local obligation there is a charter or statutory limit on the power of the issuer to levy property taxes, the pledge is a covenant to levy ad valorem taxes, within that limit, sufficient to pay the principal of and interest on the local obligation: on all real and tangible personal property that is within the issuer’s corporate limits and subject to assessment for ad valorem taxation; and in each year in which the local obligation is outstanding; a local obligation may not be issued if the issuance would cause the issuer to exceed any limit set by the charter of the issuer or by statute on the power of the issuer to incur indebtedness; and notwithstanding item (3) of this subsection: a limit on the power to incur indebtedness imposed after the issuance of a local obligation does not affect that obligation; and outstanding local obligations of an issuer are not affected by the issuance of a new local obligation if the new obligation is consistent with an increase in or the elimination of a limit on the power to incur indebtedness. An issuer of a local obligation under § 4-230 of this subtitle may secure payment by the pledge of specific revenues of the issuer. If a local obligation issued under § 4-230 of this subtitle is secured by the pledge of specific revenue, the specific revenue may include: payments to the issuer from the State or federal government; special benefit assessments, taxes, fees, or service charges that the issuer has authority to impose, levy, or charge; or revenue expected to be generated by the facility to be financed.

In this section the following words have the meanings indicated. “Capital reserve fund” means a reserve fund created under this section. “Minimum capital reserve requirement” means the minimum capital reserve amount established by the Administration for a capital reserve fund in connection with the issuance of bonds, notes, or other obligations of the Administration in connection with the financing of one or more infrastructure projects. The Administration may establish one or more capital reserve funds in connection with the financing of one or more infrastructure projects. Money in a capital reserve fund shall be used solely to pay the principal of, and premium and interest on, the bonds, notes, or other obligations of the Administration: secured by the capital reserve fund; and issued in connection with financing infrastructure projects. A capital reserve fund may consist of: money appropriated in the State budget for the purposes of the capital reserve fund; proceeds of a sale of bonds, notes, or other obligations of the Administration or the State; investment earnings of the capital reserve fund; and any other money from any other source accepted for the benefit of a capital reserve fund. If the balance of a capital reserve fund is less than the minimum capital reserve requirement established by the Administration for that fund, the Administration: may not use money from the fund for the optional purchase or redemption of a bond, note, or other obligation of the Administration; and shall replenish the fund from available operating revenue generated by infrastructure projects or funds provided by the State. If available operating revenue generated by infrastructure projects and funds provided by the State are insufficient to replenish a capital reserve fund as required under paragraph (1) of this subsection, the Administration shall request that the Comptroller advance the contingent funding to replenish the capital reserve fund as provided in the Local Government Infrastructure Financing Program Capital Reserve Fund Loan of 2009 (Chapter 719 (S.B. 932/H.B. 1330) of the Acts of the General Assembly of 2009) or any other bond bill enabling act for this purpose. Except as provided in paragraph (2) of this subsection, the Administration may not issue bonds, notes, or other obligations secured in whole or in part by a capital reserve fund if on issuance the amount in the capital reserve fund will be less than the minimum capital reserve requirement. The limitation under paragraph (1) of this subsection does not apply if at the time of issuance an amount is deposited in the capital reserve fund so that on issuance the total amount in the capital reserve fund will be at least equal to the minimum capital reserve requirement.

In this section, “government–sponsored enterprise” means the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, the Federal Home Loan Bank, or other agency or instrumentality of or chartered by the federal government that has similar powers. To finance community development projects, public purpose projects, or residential mortgage loans, the Administration may purchase or issue securities that are backed by mortgage loans and guaranteed by the Government National Mortgage Association or a government–sponsored enterprise. To finance business projects, the Administration may purchase or issue securities that are backed by loans or other obligations. Notwithstanding inconsistent provisions of this subtitle relating to bonds or notes that the Administration purchases or issues, the issuance, terms, and conditions of a security that the Administration issues under this section may be as the Administration finds necessary or desirable for guaranty by: the Government National Mortgage Association or a government–sponsored enterprise, for projects or loans described under subsection (b)(1) of this section; or the Maryland Housing Fund, a private entity, or a government–sponsored enterprise, for projects described under subsection (b)(2) of this section. Except as provided by paragraph (1) of this subsection, the provisions of this subtitle that relate to bonds or notes issued by the Administration apply to securities purchased or issued under this section.

In this section the following words have the meanings indicated. “Mortgage loan” includes a loan to: finance or refinance the purchase of stock or membership in a cooperative ownership housing corporation; or rehabilitate units in a cooperative ownership housing corporation. “Reverse equity mortgage loan” includes a loan that uses the equity in a home as collateral. The Administration may make, participate in making, and undertake a commitment for: a residential mortgage loan to a family of limited income: for a family that has a disabled family member who will reside in the dwelling; for an emergency housing need as determined by the Secretary; for settlement and down payment costs; or that is made in conjunction with a loan funded with State appropriated funds if the State appropriated funded loan comprises at least 20% of the total amount loaned; financial assistance to a family of limited income: for maintaining or modifying its existing residential mortgage loan; or that is made in conjunction with a new residential mortgage loan to enable a homeowner to refinance an existing residential mortgage loan; the refinancing of a residential mortgage loan of a homeowner if the loan was made by the Department or Administration; and financial assistance to a homeowner for: purchasing the homeowner’s primary residence and making payments on the homeowner’s student loan debt; or making payments on the homeowner’s student loan debt in conjunction with the homeowner obtaining separate financial assistance from a source other than the Administration for purchasing the homeowner’s primary residence. The Secretary shall determine the terms and qualifications for financial assistance under paragraph (1) of this subsection. In accordance with § 4–213 of this subtitle, the Administration may make, participate in making, purchase, and undertake a commitment for: a mortgage loan or other financial assistance secured by a mortgage lien for a community development project or public purpose project; and a reverse equity mortgage loan secured by a mortgage lien that is for housing related expenses of an elderly household that qualifies as a family of limited income. Financial assistance to purchase a dwelling unit in a community development project or public purpose project under paragraph (1)(i) of this subsection may include a temporary loan or advance and a permanent direct mortgage loan to a family of limited income, if otherwise required by law. Housing related expenses under paragraph (1)(ii) of this subsection include personal expenses that enable the owner to continue to occupy the owner’s home. A commitment, mortgage, bond, or secured note shall contain terms and conditions necessary to secure repayment of its loan, the interest on it, and other charges in connection with the loan. Except as provided in subparagraph (ii) of this paragraph, a mortgage loan for a community development project or a public purpose project and a reverse equity mortgage loan may bear interest at a rate or rates that the Administration finds will make the project economically feasible. The Administration may not increase the interest rate originally charged on a permanent direct mortgage loan to a family for the purchase of a dwelling unit in a community development project or a public purpose project. Subject to any agreement with noteholders or bondholders, the Administration may consent to the modification of the interest rate, time of payment of any installment of principal or interest, security, or any other term, of a mortgage, mortgage loan, reverse equity mortgage loan, mortgage loan commitment, or reverse equity mortgage loan commitment, contract, or agreement to which the Administration is a party. In connection with property on which it holds a mortgage loan or reverse equity mortgage loan: the Administration may: foreclose on the property or begin an action to protect or enforce a right that is conferred on the Administration by law, a mortgage contract, or other agreement; bid for and purchase the property at a foreclosure or other sale; or acquire or take possession of the property; and in a manner to protect the interests of the Administration, the Administration may: complete, administer, and pay the principal of and interest on an obligation incurred in connection with the property; dispose of the property; and otherwise deal with the property. This subsection does not apply to a lien held in connection with a public purpose project. The Administration may not lend money on the security of property unless the lien on the property is superior to all other liens, except for: liens for taxes owed to the State or a political subdivision; or earlier mortgage liens. The Administration may: sell any mortgage or other obligation that it holds, at public or private sale, with or without public bidding; and retain the servicing rights and charge servicing fees for any mortgage or other obligation the Administration sells. The Administration may purchase securities backed by mortgages to provide financial assistance to community development projects and public purpose projects and to finance residential mortgage loans with the proceeds of the securities or with investment earnings on the securities.

In carrying out this section and §§ 4-237 through 4-241 of this subtitle, the Administration may not make a loan to a mortgage lender or purchase a mortgage loan from a mortgage lender unless the mortgage lender is: a bank, trust company, savings institution, savings and loan association, national bank association, mortgage banker, or other financial institution that: has an office in the State; and makes or originates residential mortgage loans; an insurance company authorized to do business in the State; or the Maryland Home Financing Program.

The Administration may: purchase or commit to purchase, from a mortgage lender that is eligible under § 4–236 of this subtitle, a note, mortgage, or partial interest in a note or mortgage that evidences: a residential mortgage loan to a family of limited income; a mortgage loan to a sponsor of a community development project or a public purpose project; a residential mortgage loan to a homeowner for the purchase or rehabilitation of the homeowner’s primary residence if the primary residence is located in a sustainable community; a residential mortgage loan for the refinancing of a residential mortgage loan made by the Department or Administration; or a residential mortgage loan to a homeowner for: purchasing the homeowner’s primary residence and making payments on the homeowner’s student loan debt; or purchasing the homeowner’s primary residence in conjunction with the homeowner obtaining separate financial assistance from the Administration for making payments on the homeowner’s student loan debt; make a loan to an eligible mortgage lender in accordance with this subtitle; finance, with proceeds of its revenue bonds or notes, all or part of a mortgage purchase program or a loan to a mortgage lenders program; and take any action necessary or convenient to carry out this subsection, including: settling or compromising an obligation or debt to the Administration, subject to any agreement with bondholders; acquiring an interest in real or personal property by gift, purchase, foreclosure, or otherwise, and selling or otherwise disposing of the property; obtaining insurance against loss in connection with its property and other assets, including mortgage loans, in the amount and from the insurer that the Administration considers desirable; contracting for servicing of a mortgage loan or an interest in a mortgage loan that the Administration holds or takes as collateral; and making a contract or commitment that relates to the exercise of any of the powers listed in this subsection. The Administration may adopt regulations or program directives, as appropriate, to carry out this section, including: procedures to submit requests for the purchase or sale of mortgage loans or for loans to the eligible mortgage lenders; restrictions as to the number of family units, locations, or other qualifications or characteristics of dwellings to be financed by residential mortgage loans; restrictions as to: the interest rates on loans made from the proceeds of purchases of mortgage loans or from the proceeds of loans to eligible mortgage lenders; or returns realized by eligible mortgage lenders; restrictions on maturities and other terms of loans made from the proceeds of purchases of mortgage loans or from the proceeds of loans to eligible mortgage lenders; requirements as to the application by eligible mortgage lenders of the proceeds of the purchases or loans; schedules of fees and charges necessary to provide for expenses and reserves of the Administration; standards for allocating money among areas of the State and among eligible mortgage lenders; and provisions on warranties, representations, certifications, rights of inspection and audit, program sanctions, and other methods of ensuring compliance with the terms of purchase commitments and loans.

New mortgage loans that the Administration purchases shall be loans to: families of limited income; sponsors of community development projects; or homeowners: with primary residences located in sustainable communities; who refinance a residential mortgage loan made by the Department or Administration; or who use the loan proceeds to: purchase the homeowner’s primary residence and make payments on the homeowner’s student loan debt; or purchase the homeowner’s primary residence in conjunction with the homeowner obtaining separate financial assistance from the Administration for making payments on the homeowner’s student loan debt. A commitment that the Administration makes to purchase new mortgage loans shall specify: the interest rate on loans eligible for purchase, which may not exceed the prevailing interest rate on comparable mortgage loans available in the State, independent of public assistance or purchase; and the numbers or volumes of loans under the commitment to be made in specific geographic areas. For any residential mortgage loans to be used to acquire homes for families of limited income, the commitment shall be limited to loans of a specified amount per dwelling unit, based on the current average sale price of new homes in the area, as determined by the Administration. A commitment that the Administration makes to purchase existing mortgages shall require that the proceeds of the purchase be: reinvested, within specified time limits, in new mortgage loans to: families of limited income; or sponsors of community development projects; or invested in short-term obligations pending the purchase or making of the mortgages.

A loan from the Administration to an eligible mortgage lender shall require the eligible mortgage lender to make mortgage loans in principal amounts that add up to at least the amount of the loan from the Administration to: families of limited income; or sponsors of community development projects. After receiving the loan from the Administration, the eligible mortgage lender shall commit the amount of the mortgage loans required by paragraph (1) of this subsection within the time the Administration sets. A loan from the Administration to a mortgage lender is a general obligation of the mortgage lender as to repayment of principal and interest. Repayment of principal and interest shall be secured by a pledge of and lien on collateral security in an amount that the Administration by regulation determines to be necessary to secure the loan. The collateral security shall consist of: obligations of or guaranteed by the United States, the State, or a political subdivision; obligations issued by a unit of the federal government that are satisfactory to the Administration; certificates of deposit, time deposits, or similar banking arrangements secured by obligations of or guaranteed by the United States or the State; mortgages insured or guaranteed entirely or partly by the Maryland Housing Fund, a unit of the federal government, or a private insurer that the Administration approves; or other mortgages that the Administration finds to be of reasonably comparable security. The Administration shall require that: the collateral be held by a bank or trust company as independent custodian; or the mortgage lender enter into a security agreement containing provisions that the Administration considers necessary to identify, maintain, and service the collateral. The security agreement shall: provide that the mortgage lender: holds the collateral as an agent for the Administration; and is accountable as the trustee of an express trust for the application and disposition of the collateral; and require that the income from the collateral be applied only in accordance with the agreement. A copy of each security agreement shall be filed with the Secretary of State. Further filing or other action under the Commercial Law Article or any other law of the State is not required to perfect the security interest of the Administration in the collateral or its proceeds or in any addition to or substitution for the collateral or its proceeds. Once filed, liens and trusts created for the benefit of the Administration under this subsection are binding against each person with a claim against the mortgage lender. The Administration may establish additional requirements for pledging, assigning, setting aside, or holding the collateral, and making substitutions for or additions to it, and disposing of interest and income from it. Notwithstanding any other law, a loan to a mortgage lender and the collateral for it are not subject to §§ 17–101 and 17–102 of the Local Government Article or to § 6–202, § 6–205, § 6–206, § 6–209, or § 6–210 of the State Finance and Procurement Article.

Except as provided in subsection (c) of this section, a mortgage lender shall make a certificate under this section for every residential mortgage loan that the lender makes under a purchase commitment by the Administration with: the proceeds of purchase of a mortgage loan by the Administration; or the proceeds of a loan from the Administration. The certificate shall state that in the mortgage lender’s opinion, based on information given by the mortgagor and on the lender’s knowledge of the prevailing terms and standards of mortgage lending in the area, the mortgagor could not get a mortgage loan on the property in the unassisted private lending market. The Secretary may waive the requirement for the mortgage lender’s certificate for a residential mortgage loan to a homeowner: if the homeowner’s primary residence is located in a sustainable community, for the purchase or rehabilitation of the homeowner’s primary residence; for the refinancing of a residential mortgage loan of the homeowner if the loan was made by the Department or Administration; or for either of the purposes specified in § 4–237(a)(1)(v) of this subtitle.

Except as required to qualify for insurance or guaranty by the federal government, a residential mortgage loan may not be assigned to or assumed by a person not qualified under the appropriate Administration program if the residential mortgage loan is: a new loan that the Administration purchases or in which the Administration purchases an interest; a loan made with the proceeds of purchase by the Administration of a residential mortgage; or a loan made with the proceeds of a loan from the Administration to a mortgage lender.

In providing financial assistance to a homeowner that includes the purchase of the homeowner’s primary residence and payments on the homeowner’s student loan debt, the Administration shall give priority to selling residential property that is owned by the Administration.

The Administration may provide financial assistance, meet any development cost, or carry out any other of its purposes by spending: money appropriated by the General Assembly; the proceeds of a State loan to the extent provided by the General Assembly or a governmental unit authorized to issue bonds; the proceeds of the bonds, notes, or other evidences of indebtedness that the Administration issues, payable solely from revenues of the Administration as provided in this part; or any other money available to the Administration for community development under this subtitle: from its own operations; from investment of the proceeds of its bonds, notes, or other indebtedness; or from any other public or private source. Except as otherwise provided in a determination made under this section, the Administration shall deposit with the State Treasurer any money that it does not need to meet current expenses and obligations. The State Treasurer shall: credit the money to the Administration; invest the money as provided by statute; and credit earnings from the money to the Administration.

The Administration may: borrow money and issue bonds or notes; and use the proceeds or the earnings from the investment of the proceeds to provide money to: make, purchase, or participate in making mortgage loans or other loans; purchase securities backed by mortgage loans or other loans; purchase local obligations; meet any development cost; or achieve any other purpose of the Administration. Bonds or notes may be issued only if: the Director, or a person that the Secretary designates, determines that the issuance is necessary to achieve one or more purposes of the Administration; and the Secretary approves the determination. Without any other proceeding, action, or approval, the determination is effective when approved by the Secretary and is conclusive. For bonds or notes of any issue, the Administration has absolute discretion to determine: the date, amount, and manner of issue, including private sale; the date of maturity, which: for a bond, may not be more than 50 years after the bond is issued; and for a note, including renewals, may not be more than 5 years after the note is originally issued; the price to be paid, whether above, at, or below par, the interest rate to be paid, and the dates of payment; the form, denomination, and manner of execution, which may be by facsimile; the place of payment, which may be any bank or trust company in or out of the State; whether they are redeemable before maturity and, if so, the terms, conditions, and prices of the redemption; and any other matter relating to the form, terms, conditions, security, issuance, sale, delivery, replacement, and indemnification in connection with replacement or payment. A bond or note issued under this section is a negotiable instrument under State law notwithstanding any other provision of the Code or any recital in the bond or note. The manual or facsimile signature of an officer or employee of the Administration that appears on a bond, note, or coupon is valid even if the individual leaves office or employment before delivery of the bond, note, or coupon. The Administration may: issue its bonds or notes in coupon or registered form or both; and provide for: registration of coupon bonds or notes as to principal only or as to both principal and interest; reconversion into coupon form of bonds or notes registered as to both principal and interest; and interchange of coupon and registered bonds or notes. A bond or note issued under this section is exempt from §§ 8-206, 8-208, and 8-213 through 8-221 of the State Finance and Procurement Article. The Administration may issue a bond or note without: the consent of another governmental unit of the State; or a proceeding, or the occurrence of a condition, other than those that this section expressly requires. The Secretary and any other person executing a bond or note under this section are not personally liable or accountable because the bond or note is issued.

By written determination, the Administration may provide for the issuance of notes to renew its notes, and bonds to pay its notes or to fund or refund its bonds, whether or not the bonds to be refunded have matured, including the payment of any redemption premium and any interest accrued or to accrue on the notes or bonds to be renewed, paid, or refunded. The issuance and incidents of renewal notes and refunding bonds are governed by applicable provisions of this part.

Bonds or notes that the Administration issues may be secured by a trust agreement between the Administration and a trustee that is in or out of the State. A trustee shall be a trust company or a bank with trust powers. A trust agreement or a determination authorizing the issuance of bonds or notes may contain: subject to then–existing agreements with bondholders or noteholders, provisions to secure payment of bonds or notes by pledging or assigning: any of the revenues of the Administration; a mortgage that the Administration holds, a loan that the Administration has made, or security for the mortgage or loan; the proceeds of a bond or note of the Administration; or any combination of these and other assets of the Administration; provisions to protect and enforce rights and remedies of bondholders or noteholders, and covenants stating the duties of or restrictions on the Administration; provisions restricting the rights of bondholders or noteholders; provisions that appoint one or more trust companies or banks with trust powers to act as depositaries of the proceeds of bonds or notes or of any revenues or money of the Administration, with any indemnifying bonds or securities required by the Administration allowed to be given or pledged by any depositary bank or trust company incorporated in the State; provisions on the custody, safeguarding, and application of money of the Administration; provisions on investments of money of the Administration as the Administration provides, notwithstanding §§ 17–101 and 17–102 of the Local Government Article and §§ 6–202, 6–205, 6–206, 6–209, and 6–210 of the State Finance and Procurement Article; provisions that establish and control all aspects of reserves, including debt service reserves; provisions for funding or refunding bonds or notes, including redemption premiums and interest; and any other provisions that are reasonable and proper for the security of bondholders or noteholders.

The interest rate or rates on and the terms of any loans and the revenues from the terms of any other assets that are financed from the proceeds of bonds or notes of the Administration, any fees that the Administration charges, and any other available revenues shall be at least sufficient to ensure repayment in full of the principal of and interest on the bonds or notes as and when due. Any pledge that the Administration makes is valid and binding from the time the pledge is made. The lien of the pledge: immediately attaches, without any physical delivery or further act, to revenues or property so pledged and later received by the Administration; and is valid and binding against each person having a claim against the Administration whether or not: the person has notice of the lien of the pledge; or the determination or any other instrument has been recorded or filed.

Subject to agreements with noteholders or bondholders, the Administration may purchase its notes or bonds with any money available for the purchase. The purchase price may not exceed: the redemption price at the time of the purchase, plus accrued interest to the next interest payment date, if the note or bond is redeemable, at the time of the purchase; or the redemption price on the first date after the purchase on which the note or bond becomes redeemable, plus accrued interest to that date, if the note or bond is not redeemable at the time of the purchase. When the Administration purchases its note or bond, the note or bond shall be canceled.

A bond or note issued by the Administration under this part is a legal and proper investment for: a public officer, a political subdivision, or a governmental unit; a bank, trust company, savings and loan association, investment company, or other person doing a banking business; an insurance company, insurance association, or other person doing an insurance business; a personal representative, guardian, trustee, or other fiduciary; or any other person. For any purpose for which the deposit of a bond or other obligation of the State is authorized by law, a bond issued by the Administration under this part is a security that may legally and properly be deposited with and received by a public officer, a political subdivision, or a governmental unit.

A bond or note issued under this part: is not a debt of and does not pledge the faith, credit, or taxing power of the State, the Administration, or a political subdivision; but is payable only from the revenues and property provided for in this subtitle. Each bond or note shall state on its face the provisions of subsection (a) of this section.

The following are exempt at all times from taxation of every kind and nature whatsoever by the State, a political subdivision, or a governmental unit of any kind: a bond or note that the Administration issues under this part; the transfer of, interest payable on, or income derived from the bond or note; and profit realized by the sale or exchange of the bond or note.

To improve the management of debt issued under the provisions of this part or to reduce the cost of servicing the debt, the Administration may enter into interest rate exchange agreements or contracts providing for payments based on levels of or changes in interest rates.

A person may not knowingly make or cause to be made a false statement or report in a document required to be submitted to the Administration by an agreement relating to a loan. A person applying for a loan may not knowingly make or cause to be made a false statement or report to influence the action of the Administration on a loan application or to influence an action of the Administration affecting a loan already made. A person who violates this section is guilty of a misdemeanor and on conviction is subject to imprisonment not exceeding 5 years or a fine not exceeding $50,000 or both.