In this subtitle the following words have the meanings indicated. “District” means a taxing and assessment district. “District council” means the governing body of a county acting as the district council for a district created under this subtitle. “Project” means an erosion prevention project or erosion control project.

This subtitle supplements the provisions of the Natural Resources Article relating to shore erosion control projects.

The purpose of projects constructed under this subtitle is to prevent erosion of land by any body of water in the State.

Each recorded subdivision that abuts a body of water in the State is a district. Each district established under this section shall be named for the subdivision from which the district is created.

The governing body of a county is the district council for each district in the county. A district council shall: keep a separate record of its proceedings for each district; and deposit all money received for each district to the credit of that district. The district council shall require the depository of money under subsection (b)(2) of this section to give the same security for the repayment of money deposited and pay the same interest on the money as is required for the deposit of county funds. Any interest earnings on money deposited for a district shall be credited to that district.

This section does not apply to: the development and completion of plans and specifications for the construction of a project in a district in Anne Arundel County; the permitting activities associated with the project in Anne Arundel County; the preparation of a cost estimate for the project in Anne Arundel County; or the construction of a project in a district in Anne Arundel County. This section may not be construed as limiting or restricting a district from accessing any money kept for the benefit of the district to pay for an activity identified under paragraph (1) of this subsection. The district council may construct a project in a district if requested by a petition signed by at least 75% of the real property owners in the district. The entity administering a shore erosion control district may use tax funds for the maintenance, repair, or restoration of an existing project without a petition. The entity administering a shore erosion control district shall conduct a public hearing before using tax funds for the maintenance, repair, or restoration of an existing project. This subsection applies to any existing shoreline erosion control project within the district, regardless of the initial source of funding.

This section does not apply to Anne Arundel County. When the plans and specifications for the construction of a project in a district are complete, the district council shall notify each owner of real property in the district: that the plans and specifications for the construction of the project are complete and can be inspected at the office of the governing body of the county; of the probable cost of the project; and of the date and place of a hearing on the petition. The notice shall be: mailed to the last known address of each property owner in the district; and published once each week for 2 successive weeks in a newspaper of general circulation in the county. After holding a hearing, the district council shall decide whether to proceed with the project.

The district council may acquire an easement in any land or structure that is necessary to construct, extend, or maintain a project in the district. If the district council and property owner cannot agree on the acquisition of an easement in the owner’s property, the district council may begin condemnation proceedings in the circuit court of the county, as provided in Title 12 of the Real Property Article. Subject to subparagraph (ii) of this paragraph, the district council may enter and take possession of the condemned property not less than 10 days after the recordation of the award in a condemnation proceeding under this subsection. Notwithstanding an appeal or further proceedings taken by a defendant in the condemnation proceeding, before taking possession of the condemned property, the district council shall: pay the amount of the award and all costs imposed to the clerk of the court; and give its corporate undertaking to abide by and fulfill any judgment on appeal or on further proceedings.

The district council may borrow money, on the full faith and credit of the district, to: acquire by purchase or condemnation an easement under § 21–208 of this subtitle to construct a project in or for the district; and complete the project. The money borrowed by the district council for a project shall: bear interest at a rate set by the district council not exceeding 6% per year; be payable semiannually; and be secured by bonds, notes, or other evidence of indebtedness issued by the district council on the full faith and credit of the district. Subject to § 21–212(e)(2) of this subtitle, the bonds, notes, or other evidence of indebtedness issued under this subsection shall: be exempt from State, county, and municipal taxation; mature serially at the times determined by the district council, not to exceed 30 years; be made payable within 30 years after issuance; and be issued under the seal of the county. Notwithstanding §§ 19–205 and 19–206 of this article, the district council may sell the bonds, notes, or other evidence of indebtedness at public or private sale. The governing body of the county shall guarantee the payment of principal of and interest on any bonds issued by the district council under this section. The guaranty shall be endorsed on each bond in the following language: “The payment of interest when due and the principal at maturity is guaranteed by ….. County, Maryland.” Within 20 days after the bonds are ready for endorsement, the endorsement shall be: signed on each bond by the chair of the governing body or the county executive, as applicable; attested to by the clerk of the governing body of the county; and affixed with the county seal.

Except as otherwise provided in this section, this subtitle applies to any project undertaken and any bonds, notes, or other evidence of indebtedness issued under this section. The purpose of this section is to provide an alternative means to finance projects on a countywide basis, for which the governing body of the county does not sit as a district council. The governing body of a county may pay not more than 25% of the cost of any project in the county through the issuance of bonds, notes, or other evidence of indebtedness. If the governing body pays for a portion of a project under this subsection, the governing body may accept any of the remaining cost of the project from: the State; the federal government; or any unit of the State or federal government. Except as provided in paragraph (2) of this subsection, any bond, note, or other evidence of indebtedness issued under this section shall be issued as provided in this subtitle. Any bond, note, or other evidence of indebtedness issued under this section: is not a district obligation; and shall have its payments of principal and interest met by a countywide tax.

The district council shall publish notice once each week for 2 successive weeks in a newspaper of general circulation in the county or in technical press for bids for the construction of a project. The district council shall award the contract for a project to the lowest responsible bidder. The district council may: reject any and all bids for a contract for a project; and readvertise for bids, in accordance with and subject to this subtitle. Before awarding a contract for a project, the district council shall require from the successful bidder a bond in a form and amount approved by the district council. The bond shall be conditioned on: completing the project in accordance with the plans, specifications, and time limitations specified in the contract; and paying for all supplies and labor provided to the contractor in the construction of the project.

After a project for a district has been completed, either wholly or partly, the district council shall impose a benefit charge on all real property in the district benefiting from the project. Before imposing the benefit charge, the district council shall notify each owner of real property in the district that the district council is proposing to make an assessment of benefit against the owner’s property for the project. The notice shall state the date and place of the hearing. A hearing notice shall be: mailed to the last known address of each property owner in the district; and published once each week for 2 successive weeks in a newspaper of general circulation in the county. After holding a hearing under subsection (b) of this section, the district council shall: determine the extent of the benefit from the project to each lot and parcel of land in the district; and impose the benefit charge on each lot and parcel of land in the district based on the determinations made under item (1) of this subsection. A benefit charge imposed under this section is a lien on the real property against which the benefit charge is imposed. The benefit charge shall be paid: annually as county taxes are required to be paid; and for a period that is coextensive with the period of maturity for the bonds, notes, or other evidence of indebtedness issued to construct the project. This subsection applies only in: Carroll County; Dorchester County; St. Mary’s County; and Somerset County. The annual benefit charge imposed under this section is payable in annual installments over 25 years or any shorter time as directed by the governing body of the county. Each annual installment is a personal obligation of the owner of the benefited property at the time the installment becomes due. An annual installment in default is a first lien on the benefited property, subject only to prior State, county, or municipal real property taxes. The outstanding balance of a benefit charge shall be given normal lien priority. The sale of a benefited property does not extinguish the lien imposed against the property. The purchaser of a benefited property shall: take ownership of the property subject to any outstanding balance of the total benefit charge unpaid at the conclusion of the sale; and be required to pay the same annual installments as the previous owner of the property. For purposes of § 3–104(b) of the Real Property Article, relating to the payment of taxes as a prerequisite to recording a transfer of property, it is sufficient that all current annual installments of any benefit charge imposed under this subtitle have been paid.

Each year, the district council shall impose a tax against all assessable property in each district that has been improved by a project. Each year before the tax is imposed, the district council shall determine the number of cents per $100 necessary to raise the amount of money required under paragraph (3) of this subsection. The amount of tax imposed under this subsection, together with the benefit charges collected under § 21–212 of this subtitle, shall be sufficient to: meet the interest and principal payments due on the bonds, notes, or other evidence of indebtedness issued to finance the construction of projects under this subtitle; pay the entire cost of repairing and maintaining the project in a district; and pay all the expenses of the district necessary to carry out this subtitle, including reimbursing the district council for expenses incurred by members of the district council, not exceeding $200 annually for each member, for: inspecting bulkheads; and performing other duties required in the administration of this subtitle. The district council shall impose the tax required under this subsection until all the bonds, notes, or other evidence of indebtedness and their interest, in addition to other debt incurred in carrying out this subtitle, have been paid. After the requirements of paragraph (4) of this subsection have been satisfied, the district council shall impose a tax sufficient only to maintain the project. The tax imposed under subsection (a) of this section shall: be imposed in the same manner as county taxes; and have the same priority rights, bear the same interest and penalties, and in every respect be treated the same as county taxes. The taxing authority of the county shall: collect the taxes; and remit the amount collected to the district council every 60 days. The district council shall deposit money received under subsection (b) of this section in a bank in the county: to the credit of the district council for the district from which the money was collected; and at the rate of interest paid for county funds. The district council shall pay out the taxes and benefit charges collected from a district in the following order: from the taxes and benefit charges: the interest on the bonds, notes, or other evidence of indebtedness issued for the projects in the district; and the bonds, notes, or other evidence of indebtedness when and as the bonds, notes, or other evidence of indebtedness mature; and from the remaining taxes, all other debt incurred in carrying out this subtitle, including project maintenance. If the receipts from the taxes and benefit charges imposed under this subtitle for any district do not meet the required payments in any year by reason of default or otherwise, the amount of the deficiency shall be added to the next year’s tax imposition for that district. Paragraph (1) of this subsection does not release a county from its obligation to impose ad valorem taxes on assessable property in the county at a rate and of an amount sufficient to pay the maturing principal of and interest on bonds.

A person or agency may not: fail to perform duties required under this subtitle; fail to pay the principal of and interest on any bonds, notes, or other evidence of indebtedness as required by this subtitle; or use the money from bonds, notes, or other evidence of indebtedness for any purpose other than the purpose specified under this subtitle. A person who violates this section is guilty of a misdemeanor and on conviction is subject to imprisonment not exceeding 3 years or a fine not exceeding $1,000 or both.