In this part the following words have the meanings indicated. “Authorizing resolution” means an administrative resolution adopted by the legislative body of a county. “County” includes a combination of two or more counties that have entered into an agreement under this part. “Note” means an evidence of indebtedness of a county issued under this part. “Note” includes: a bond; commercial paper; a refunding bond; a refunding note; and any other obligation. “State share”, with reference to a particular county on a particular date, means the aggregate amount of the anticipated State share of the costs of public school construction and capital improvements under § 5–303 of the Education Article that: has been approved by the Board of Public Works; and has not been advanced to the county.

A county may borrow money and incur indebtedness through the issuance and sale of notes in anticipation of the receipt of any of the county’s State share. The amount borrowed may not exceed at any one time the county’s State share. In calculating the maximum principal amount of notes that may be outstanding, the State share may not be reduced with respect to any outstanding notes except on receipt by the county of money advanced by the State with respect to the State share and payment of notes with the money. A county may enter into an agreement with one or more counties to provide for the issuance and sale of consolidated notes in anticipation of the receipt of any of the aggregate State shares of the participating counties.

A county may expend the net proceeds of the sale of an issue of notes only to: pay the costs of public school construction or capital improvements approved at any time by the Board of Public Works in anticipation of State money for any of the construction or improvements; or refund one or more issues of notes.

The principal of the notes may be paid from: the proceeds of any of the State share for a county; any other revenues that are pledged to the payment of the notes in the authorizing resolution; or money made available to the county to finance the public school construction and capital improvements from: the State or unit of the State; the federal government or a unit of the federal government; or any other source. The interest on the notes may be paid from: any revenues, other than the proceeds of the State share for a county, that are pledged to the payment of the notes in the authorizing resolution; or money made available to the county to finance public school construction and capital improvements from: the State or a unit of the State, except for the State share allocated under this part for public school construction and capital improvements; the federal government or a unit of the federal government; or any other source. A county may pledge its full faith and credit and taxing power to the payment of the principal of and interest on the notes in the authorizing resolution. A county that makes a pledge under paragraph (1) of this subsection shall, in each fiscal year that any of the notes are outstanding, impose ad valorem taxes on all assessable property in the county at a rate and amount sufficient to pay the principal of and interest on the notes maturing in that fiscal year. If the proceeds from the taxes imposed in any fiscal year prove inadequate for the payment, the county shall impose additional taxes in the succeeding fiscal year to make up the deficiency.

The notes shall be authorized by a resolution. The authorizing resolution shall: cite the authority to issue the notes and the amount authorized; and specify: the maturity; the interest rate or manner of determining the rate, which may include a variable rate; the price at which the notes will be sold, which may be at, above, or below the face value of the notes; or the manner of determining the price at which the notes will be sold; the manner of the sale of the notes, which may be by private negotiation by the county with a prospective purchaser, if determined by the county to be in the county’s best interest; the terms or conditions, if any, under which notes may or shall be redeemed prior to their stated maturity; and other terms on the notes. The authorizing resolution may provide for: the issuance of the notes in series, as money is required; and the renewal of the notes at maturity, with or without resale.

If the authorizing resolution provides, notes may be secured by: a trust indenture with a corporate trustee, which may be any trust company or bank having the powers of a trust company in or outside the State; and a letter of credit, line of credit, or other credit or liquidity instrument from or with a bank or other lending institution. A security provided by an authorizing resolution under this section may be secured by the same security given to holders of the notes for the performance by a county of the county’s monetary obligations under the notes.

A note is not subject to §§ 19–205 and 19–206 of this title.

A note is a valid and binding obligation of the issuing county in accordance with the terms of the note even if an official whose signature appears on the note: ceases to be an official before the delivery of the note; or becomes an official after the date of issue of the note.

The notes, the transfer of the notes, the interest payable on the notes, and any income derived from the notes, including profit realized in the sale or exchange of the notes, are exempt from State and local taxes.

The authorizing resolution, and notes and agreements authorized under the authorizing resolution, are not subject to: procedures required for legislative acts; or referendum. The authorizing resolution may include covenants regarding the payment of principal of and interest on the notes, notwithstanding any: limitation in the county charter; other public general law; or public local law. A county may adopt an authorizing resolution without complying with any procedures in: the county charter; any public general law; or a public local law. Public school construction and capital improvements financed by a county under this part are not a capital project of a county for purposes of any constitutional, charter, statutory, or other limitation. Any notes or agreements issued or entered into under this part may not be subject to or included in any constitutional, charter, statutory, or other limitation for the issuance of indebtedness by a county. The provisions of this part are self–executing.

Except as provided in paragraph (2) of this subsection, an agreement entered under § 19–602(b) of this subtitle may include the provisions that the counties adopt in the authorizing resolution. An agreement may not expire before the redemption or maturity of the notes issued under the agreement. By agreement, two or more counties may establish a trust or similar arrangement authorized to sell notes on the same terms and in the same manner as counties may sell notes under this part and loan the proceeds of the notes to the counties.

The authority to borrow money and issue notes granted to counties by this part is: supplemental to any other power granted to a county by any other law; and not in derogation of any other existing power of a county to borrow money.

“New school capacity construction bonds” means 10–year bonds issued under this part.

The County Commissioners of Charles County may issue new school capacity construction bonds at any time on the full faith and credit of the county to fund the costs incurred to construct new capacity for public elementary, middle, and high school facilities in the county, including: costs for land acquisition, architectural and engineering design, infrastructure, new classrooms, equipment, interest on bond principal, and bond issuance; and an amount equal to the total square footage of new public elementary, middle, and high school facilities in the county multiplied by the State square foot construction allowance, less the State funding share. The new school capacity construction bonds shall constitute securities: in which all public officers, public bodies of the State and its political subdivisions, insurance companies, State banks and trust companies, national banking associations, savings banks, savings and loan associations, investment companies, executors, administrators, trustees, and other fiduciaries may properly and legally invest money, including capital in their control or belonging to them; and which may be properly and legally deposited with and received by any State or county officer, State unit, or political subdivision of the State for any purpose for which the deposit of bonds or obligations of the State may be authorized by law. The County Commissioners of Charles County shall hold a public hearing and provide reasonable notice of the hearing before issuing new school capacity construction bonds. The issuance and sale of new school capacity construction bonds under this part is exempt from § 19–205 and § 19–206 of this title. The transfer of, interest on, and any income derived from new school capacity construction bonds are exempt from State and local taxes.