In this subtitle, “program” means a residential mortgage program authorized under this subtitle.

A transaction under this subtitle is not a capital project within the meaning of any statutory or charter provision.

The General Assembly finds that: persons and families in many areas in Cecil County, including areas that contain presently stable neighborhoods and middle class residential housing, are unable to purchase, rehabilitate, and maintain decent, safe, and sanitary housing that provides an opportunity for home ownership either directly or through a condominium or cooperative form of ownership due to continuing increases in the cost of construction and rehabilitation, county taxes, heating and electricity expenses, maintenance and repair expenses, inflation, the cost of land, the cost of energy conservation measures, and the levels of borrowing costs; the inability of families to purchase and maintain housing in the county results in: the decline of new housing; the decay of existing housing and neighborhoods; and increases in costs for welfare, police, and fire protection; the decline in new housing construction, and the decay of existing housing, has produced a critical shortage of adequate housing in the county that harms the economy of the county and the well–being of county residents; without a program, private enterprise cannot construct or rehabilitate adequate housing for persons and families in the county; forcing families to live in substandard housing is undesirable because it tends to decrease the interest of families in their communities, the maintenance of their property, and the preservation of their neighborhoods; the county has a basic public interest in: providing a supplemental source of single–family residential mortgage funds at a cost lower to the borrower than prevailing rates for residential mortgages; and stimulating a steady flow of money for residential housing to help in maintaining a well–balanced society, existing housing, a sound tax base, and established neighborhoods; unless new facilities are constructed and existing housing, where appropriate, is rehabilitated, a large number of county residents have been and will be subject to hardship in finding decent, safe, and sanitary housing; unless the supply of housing and the ability of persons and families to obtain mortgage financing is increased significantly and expeditiously, many county residents may be compelled to live in unsanitary, overcrowded, or unsafe conditions to the detriment of the health and welfare of the residents and of their community; increasing the housing supply of the county and the ability of persons and families to obtain mortgage financing will: aid the clearance, replanning, development, and redevelopment of blighted areas; alleviate the critical shortage of adequate housing; and greatly enhance the ability of the county to preserve and utilize existing housing and neighborhoods; a major cause of the housing crisis is the lack of affordable loans so that persons and families can own and maintain decent, safe, and sanitary housing; an additional major cause of the housing crisis is the lack of money available to finance housing by the private mortgage lending institutions of the State, frustrating the maintenance, sale, and purchase of existing housing in the county; the powers authorized under this subtitle and the expenditure of public money necessary and appropriate to carry out a program are a valid public purpose; and the enactment of this subtitle is in the public interest. The legislative purpose of this subtitle is to expand money available at borrowing costs that are lower than prevailing costs for residential mortgages for persons and families to alleviate the shortage of adequate housing in Cecil County and to preserve existing housing and neighborhoods.

By ordinance or resolution, the governing body of Cecil County shall specify: the program; the amount of bonds to be issued under the program; the interest rate of the bonds, or the manner of determining the rate; and other provisions not inconsistent with this subtitle to effect the financing of the mortgage loans. In the ordinance or resolution adopted under this subtitle, the governing body of Cecil County shall make findings regarding: the need for the financing authorized under this subtitle; the types of housing available and needed in the county; and other factors that the governing body finds appropriate to establish a program. An ordinance or resolution adopted under this subtitle is not subject to: referendum; or other procedures that do not apply to all ordinances or resolutions enacted by Cecil County.

Notwithstanding any other law, Cecil County may issue revenue bonds, notes, or other evidence of indebtedness to accomplish the purposes of this subtitle. The county may use money borrowed under this subtitle to make funds available, directly or through mortgage lending institutions, for residential mortgage loans by: forward commitment mortgage purchases; existing mortgage purchases; loans to lenders; a revolving mortgage fund; or any other manner the county considers appropriate. The county may issue new bonds to provide funds for the payment of any outstanding bonds in accordance with this subtitle and § 19–207 of this title. The new bonds shall be secured to the same extent and have the same source of payment as the refunded bonds. The amount borrowed under this subtitle may not exceed $35,000,000 in the total aggregate amount. Cecil County may collect participation charges to cover loan processing, loan administration, mortgage insurance, and other costs and expenses of a program from a borrower participating in the program. A program may provide for: loan agreements; security agreements; loan servicing agreements; forms of mortgages, notes, and deeds of trust; and other appropriate securities, documents, agreements, and provisions.

A program shall require a down payment of at least 10% of the purchase price of the dwelling. The down payment may be in the form of cash or real property owned by a mortgagor on which a dwelling has been constructed. If the down payment is in the form of real property, the property shall be valued at the lesser of its purchase price or appraised value. An individual mortgage loan authorized under a program may not exceed $90,000.

A bond issued under this subtitle: shall be negotiable; may be issued in coupon form or registrable as to principal or as to both principal and interest; may be issued to bear interest, payable annually, semiannually, or otherwise; and may be executed, issued, or delivered at any time. A bond issued under this subtitle shall be signed by the president of the governing body of Cecil County. The seal of the county shall be affixed to the bond and attested to by the clerk or the officer performing the functions of the clerk. An officer’s signature or countersignature on a bond or coupon remains valid even if the officer ceases to be an officer before the delivery of the bond. The county may not issue a bond under this subtitle that matures later than 40 years from the date of issue. The county shall pay for a mature bond at the place that the county determines. Bonds issued under this subtitle may be secured by a pledge of mortgages or notes secured by deeds of trust on any type of interest in real or other property, including: real property or other interests held by stock cooperatives and condominiums and their unit owners; servicing agreements; condemnation proceeds; proceeds of private mortgage insurance or casualty and special hazard insurance; or any other security that Cecil County determines is appropriate. Bonds issued under this subtitle may provide that the bonds may be redeemed, at the option of Cecil County, before maturity, at the price and under the terms and conditions that the county sets before the bonds are issued. Money received from bonds issued under this subtitle may be used only to: make residential mortgage loans in Cecil County, either directly or through mortgage lending institutions; establish reserve funds; pay necessary financing expenses; or advance the payment of interest on the bonds during the 3 years after the date of the bonds.

Cecil County shall sell bonds authorized under this subtitle at public or private sale and on the terms that the county considers best. Bonds issued under this subtitle are exempt from §§ 19–205 and 19–206 of this title.

A bond issued under this subtitle and the interest on the bond are limited obligations of Cecil County. Cecil County may pay the principal of and interest on a bond issued under this subtitle only from: revenues derived from interest, mortgage insurance proceeds, casualty or special hazard insurance proceeds, other insurance proceeds, or condemnation proceeds; or other revenues derived from or related to loans made under a program. Bonds and interest coupons issued under this subtitle: are not debts or charges against the general credit or taxing powers of Cecil County within the meaning of any constitutional or county code provision or statutory limitation; and do not give rise to any pecuniary liability of the county. On the advice of counsel, Cecil County may state on the face of a bond that the bond: is issued under this subtitle; and is not an indebtedness to which the faith and credit of the county is pledged.

A finding made by Cecil County regarding a program or the qualification of a person or family to participate in a program is conclusive in a proceeding involving the validity or enforceability of a bond, or security for a bond, issued under this subtitle.

The principal amount of the bonds issued under this subtitle, the transfer of the bonds, the interest payable on the bonds, and any income derived from the bonds, including profit realized in the sale or exchange of the bonds, are exempt from State and local taxes.