HOUSE BILL 1230

Unofficial Copy 2004 Regular Session

F1 4lr2330

CF 4lr2331

____________________________________________________________________________________

By: Delegates Hixson and Edwards (Task Force to Study Public School

Facilities) and Delegates Leopold and Conway

Introduced and read first time: February 13, 2004

Assigned to: Appropriations and Ways and Means

_____________________________________________________________________________________

A BILL ENTITLED

1 AN ACT concerning

2 Public School Facilities Act of 2004

3 FOR the purpose of authorizing counties to finance the construction or renovation of

4 public school facilities, under certain circumstances, using alternative financing

5 methods, engaging in competitive negotiation, accepting unsolicited proposals,

6 and using quality based selection; authorizing a private entity to hold title to

7 property used for a certain public school or school system under certain

8 circumstances; expressing the intent of the General Assembly that the State

9 Department of Education and the Public School Construction Program

10 encourage local education agencies to use recently used school designs under

11 certain circumstances; requiring the Interagency Committee on School

12 Construction to survey the condition of certain school buildings; requiring the

13 Department of General Services to conduct certain inspections; requiring the

14 Interagency Committee to make a certain annual report to the Governor and the

15 General Assembly; requiring the Department of General Services to submit a

16 certain annual report to the State Department of Education and local education

17 agencies; authorizing certain counties to issue certain bonds under certain

18 circumstances; providing for the issuance and administration of the bonds;

19 providing for the repayment of the bonds; authorizing certain counties to impose

20 a sales tax on certain retail sales, subject to certain limits; authorizing certain

21 counties to impose a certain transfer tax on certain instruments, subject to

22 certain limits; repealing a certain exemption from the Administrative Procedure

23 Act; altering the amount of grants provided to counties under the Aging Schools

24 Program; providing an exception to a certain mandatory level of State funds to

25 be granted to Prince George's County and Baltimore City; expressing the intent

26 of the General Assembly that the Board of Public Works establish an emergency

27 repair fund to be used to finance certain renovations and improvements to

28 public schools; specifying that the purchase of relocatable classrooms are eligible

29 for State funding; requiring the Public School Construction Program to provide

30 assistance to Baltimore City, counties, and local education agencies in using

31 alternative financing mechanisms; requiring the State Department of Education

32 to adopt certain regulations; requiring the Board of Public Works to adopt

33 certain regulations; defining certain terms; providing for the effective dates of

34 this Act; and generally relating to the funding and administration of public

2 HOUSE BILL 1230

1 school construction.

2 BY repealing and reenacting, with amendments,

3 Article - Education

4 Section 4-114, 5-206(f), 5-301, and 5-302

5 Annotated Code of Maryland

6 (2001 Replacement Volume and 2003 Supplement)

7 BY adding to

8 Article - Education

9 Section 4-126 and 5-309 through 5-311; and 5-601 through 5-604, inclusive, to

10 be under the new subtitle "Subtitle 6. Authorization to Issue Bonds to

11 Fund Public School Construction"

12 Annotated Code of Maryland

13 (2001 Replacement Volume and 2003 Supplement)

14 BY repealing and reenacting, with amendments,

15 Article - Tax - General

16 Section 11-102(b)

17 Annotated Code of Maryland

18 (1997 Replacement Volume and 2003 Supplement)

19 BY repealing and reenacting, with amendments,

20 Chapter 704 of the Acts of the General Assembly of 1998, as amended by

21 Chapter 420 of the Acts of the General Assembly of 2001 and Chapter 289

22 of the Acts of the General Assembly of 2002

23 Section 3

24 BY repealing and reenacting, with amendments,

25 Chapter 280 of the Acts of the General Assembly of 2001, as amended by

26 Chapter 288 of the Acts of the General Assembly of 2002 and Chapter 388

27 of the Acts of the General Assembly of 2003

28 Section 1

29 SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF

30 MARYLAND, That the Laws of Maryland read as follows:

31 Article - Education

32 4-114.

33 (a) All property granted, conveyed, devised, or bequeathed for the use of a

34 particular public school or school system:

3 HOUSE BILL 1230

1 (1) [Shall] EXCEPT AS PROVIDED IN SUBSECTION (C) OF THIS SECTION,

2 SHALL be held in trust for the benefit of the school or school system by the

3 appropriate county board; and

4 (2) Is exempt from all State and local taxes.

5 (b) Money invested in trust for the benefit of the public schools for any county

6 or city is exempt from all State and local taxes.

7 (C) A PRIVATE ENTITY MAY HOLD TITLE TO PROPERTY USED FOR A

8 PARTICULAR PUBLIC SCHOOL OR LOCAL SCHOOL SYSTEM IF THE PRIVATE ENTITY IS

9 CONTRACTUALLY OBLIGATED TO TRANSFER TITLE TO THE APPROPRIATE COUNTY

10 BOARD ON A SPECIFIED DATE.

11 4-126.

12 (A) IN THIS SECTION, "ALTERNATIVE FINANCING METHODS" INCLUDES:

13 (1) SALE-LEASEBACK ARRANGEMENTS, IN WHICH A COUNTY BOARD

14 AGREES TO TRANSFER TITLE TO A PROPERTY, INCLUDING IMPROVEMENTS, TO A

15 PRIVATE ENTITY THAT SIMULTANEOUSLY AGREES TO LEASE THE PROPERTY BACK

16 TO THE COUNTY BOARD AND, ON A SPECIFIED DATE, TRANSFER TITLE BACK TO THE

17 COUNTY BOARD;

18 (2) LEASE-LEASEBACK ARRANGEMENTS, IN WHICH A COUNTY BOARD

19 LEASES A PROPERTY TO A PRIVATE ENTITY THAT IMPROVES THE PROPERTY AND

20 LEASES THE PROPERTY, WITH THE IMPROVEMENTS, BACK TO THE COUNTY BOARD;

21 (3) PUBLIC-PRIVATE PARTNERSHIP AGREEMENTS, IN WHICH A COUNTY

22 BOARD CONTRACTS WITH A PRIVATE ENTITY FOR THE ACQUISITION, DESIGN,

23 CONSTRUCTION, IMPROVEMENT, RENOVATION, EXPANSION, EQUIPPING, OR

24 FINANCING OF A PUBLIC SCHOOL, AND MAY INCLUDE PROVISIONS FOR

25 COOPERATIVE USE OF THE SCHOOL OR AN ADJACENT PROPERTY AND GENERATION

26 OF REVENUE TO OFFSET THE COST OF CONSTRUCTION OR USE OF THE SCHOOL; AND

27 (4) PERFORMANCE-BASED CONTRACTING, IN WHICH A COUNTY BOARD

28 ENTERS INTO AN ENERGY PERFORMANCE CONTRACT TO OBTAIN FUNDING FOR A

29 PROJECT WITH GUARANTEED ENERGY SAVINGS OVER A SPECIFIED TIME PERIOD.

30 (B) EXCEPT WHEN PROHIBITED BY LOCAL LAW, IN ORDER TO FINANCE

31 PUBLIC SCHOOL CONSTRUCTION, A COUNTY MAY:

32 (1) USE ALTERNATIVE FINANCING METHODS;

33 (2) ENGAGE IN COMPETITIVE NEGOTIATION, RATHER THAN

34 COMPETITIVE BIDDING, IN LIMITED CIRCUMSTANCES, AS PROVIDED IN

35 REGULATIONS ADOPTED BY THE BOARD OF PUBLIC WORKS;

4 HOUSE BILL 1230

1 (3) ACCEPT UNSOLICITED PROPOSALS FOR THE DEVELOPMENT OF

2 PUBLIC SCHOOLS IN LIMITED CIRCUMSTANCES, AS PROVIDED IN REGULATIONS

3 ADOPTED BY THE BOARD OF PUBLIC WORKS; AND

4 (4) USE QUALITY-BASED SELECTION, IN WHICH SELECTION IS BASED

5 ON A COMBINATION OF QUALIFICATIONS AND COST FACTORS, TO SELECT

6 DEVELOPERS AND BUILDERS, AS PROVIDED IN REGULATIONS ADOPTED BY THE

7 BOARD OF PUBLIC WORKS.

8 (C) AT THE REQUEST OF THE INTERAGENCY COMMITTEE ON SCHOOL

9 CONSTRUCTION, THE BOARD OF PUBLIC WORKS MAY ADOPT REGULATIONS TO

10 IMPLEMENT THE PROVISIONS OF THIS SECTION, INCLUDING:

11 (1) GUIDELINES FOR THE ACCEPTANCE AND EVALUATION OF

12 UNSOLICITED PROPOSALS;

13 (2) REQUIREMENTS FOR THE EXECUTION OF A COMPREHENSIVE

14 AGREEMENT GOVERNING AN ARRANGEMENT AUTHORIZED UNDER THIS SECTION;

15 AND

16 (3) THE APPLICABILITY OF STATE PROCUREMENT LAWS TO

17 PROCUREMENT OR FINANCING OF PUBLIC SCHOOL CONSTRUCTION AUTHORIZED

18 UNDER THIS SECTION.

19 5-302.

20 (a) (1) The BOARD OF PUBLIC WORKS SHALL ESTABLISH THE Interagency

21 Committee on School Construction [established by the Board of Public Works is] AS

22 a unit within the Department for administrative and budgetary purposes.

23 (2) THE INTERAGENCY COMMITTEE CONSISTS OF THE FOLLOWING

24 MEMBERS:

25 (I) THE STATE SUPERINTENDENT OF SCHOOLS, OR THE

26 SUPERINTENDENT'S DESIGNEE;

27 (II) THE SECRETARY OF THE DEPARTMENT OF PLANNING, OR THE

28 SECRETARY'S DESIGNEE; AND

29 (III) THE SECRETARY OF GENERAL SERVICES, OR THE SECRETARY'S

30 DESIGNEE.

31 (3) THE STATE SUPERINTENDENT OF SCHOOLS, OR THE

32 SUPERINTENDENT'S DESIGNEE, SHALL BE THE CHAIRMAN OF THE INTERAGENCY

33 COMMITTEE.

34 (b) (1) The Department or any other State agency may lend its employees to

35 serve as the staff for the Interagency Committee.

36 (2) These employees shall be paid by the agency that employs them.

5 HOUSE BILL 1230

1 (c) The Executive Director of the Interagency Committee shall be appointed

2 by the Interagency Committee with the approval of the Board of Public Works.

3 (d) (1) (I) The Interagency Committee [on School Construction] shall

4 prepare projections of school construction and capital improvement needs for

5 submission to the Capital Debt Affordability Committee under § 8-112(c)(3) of the

6 State Finance and Procurement Article.

7 (II) The projections shall be prepared in accordance with the [rules,

8 regulations, and procedures] REGULATIONS adopted by the Board under § 5-301 of

9 this subtitle.

10 (2) (I) The Board of Public Works or the Interagency Committee [on

11 School Construction] shall notify each county board and each local governing body of

12 the annual allocation of school construction funds recommended to the Board of

13 Public Works by the Governor under the consolidated capital debt program of the

14 State Finance and Procurement Article.

15 (II) The notification shall be made immediately after the Governor

16 has recommended the allocations so that each county may structure its respective

17 school construction and capital improvement priorities in accordance with the annual

18 allocation and any amendments.

19 (E) (1) ON OR BEFORE DECEMBER 31 OF EACH YEAR, THE INTERAGENCY

20 COMMITTEE SHALL PROVIDE RECOMMENDATIONS TO THE BOARD OF PUBLIC WORKS

21 FOR PUBLIC SCHOOL CONSTRUCTION PROJECTS THAT COMPRISE AT LEAST 75% OF

22 THE ANTICIPATED SCHOOL CONSTRUCTION ALLOCATION FOR THE FOLLOWING

23 FISCAL YEAR.

24 (2) THE REMAINING PUBLIC SCHOOL CONSTRUCTION ALLOCATION FOR

25 THE FOLLOWING FISCAL YEAR MAY BE ALLOCATED BY THE BOARD OF PUBLIC

26 WORKS AS PROVIDED IN REGULATION.

27 5-309.

28 IT IS THE INTENT OF THE GENERAL ASSEMBLY THAT THE DEPARTMENT AND

29 THE PUBLIC SCHOOL CONSTRUCTION PROGRAM ENCOURAGE LOCAL EDUCATION

30 AGENCIES TO REUSE RECENTLY USED SCHOOL DESIGNS, WHEN EDUCATIONALLY

31 APPROPRIATE AND COST EFFECTIVE OVER THE USEFUL LIFE OF THE PROJECT,

32 WITHIN EACH COUNTY AND ACROSS LOCAL SCHOOL SYSTEM BOUNDARIES.

33 5-310.

34 (A) EACH FISCAL YEAR, THE INTERAGENCY COMMITTEE SHALL SURVEY THE

35 CONDITION OF SCHOOL BUILDINGS IDENTIFIED BY THE DEPARTMENT.

36 (B) THE DEPARTMENT OF GENERAL SERVICES SHALL CONDUCT THE

37 INSPECTIONS OF INDIVIDUAL SCHOOL BUILDINGS THAT THE INTERAGENCY

38 COMMITTEE REQUIRES TO COMPLETE THE SURVEY REQUIRED IN SUBSECTION (A) OF

39 THIS SECTION.

6 HOUSE BILL 1230

1 (C) THE INTERAGENCY COMMITTEE SHALL REPORT TO THE GOVERNOR AND

2 THE GENERAL ASSEMBLY, ON OR BEFORE OCTOBER 1 OF EACH YEAR, IN

3 ACCORDANCE WITH § 2-1246 OF THE STATE GOVERNMENT ARTICLE, ON THE

4 RESULTS OF THE SURVEY FOR THE PRIOR FISCAL YEAR.

5 5-311.

6 ON OR BEFORE JULY 1 OF EACH YEAR, THE DEPARTMENT OF GENERAL

7 SERVICES SHALL PROVIDE A REPORT TO THE DEPARTMENT AND EACH LOCAL

8 EDUCATION AGENCY THAT DESCRIBES EXISTING STATE PURCHASING CONTRACTS

9 THAT LOCAL EDUCATION AGENCIES MAY USE TO PURCHASE SCHOOL FURNITURE,

10 EQUIPMENT, COMMODITIES, AND SERVICES.

11 SUBTITLE 6. AUTHORIZATION TO ISSUE BONDS TO FUND PUBLIC SCHOOL

12 CONSTRUCTION.

13 5-601.

14 EXCEPT AS PROVIDED IN § 5-603(B) AND (C) OF THIS SUBTITLE, THE PROVISIONS

15 OF THIS SUBTITLE DO NOT APPLY TO A COUNTY OTHERWISE AUTHORIZED TO ISSUE

16 BONDS TO FUND PUBLIC SCHOOL CONSTRUCTION UNDER OTHER PROVISIONS OF

17 THE CODE.

18 5-602.

19 (A) IN THIS SUBTITLE, "CONSTRUCTION OR IMPROVEMENT" MEANS THE

20 PLANNING, DESIGN, ENGINEERING, ALTERATION, CONSTRUCTION,

21 RECONSTRUCTION, ENLARGEMENT, EXPANSION, EXTENSION, IMPROVEMENT,

22 REPLACEMENT, REHABILITATION, RENOVATION, UPGRADING, REPAIR, OR CAPITAL

23 EQUIPPING.

24 (B) A COUNTY MAY ISSUE BONDS TO FINANCE ANY OR ALL OF THE COSTS OF

25 CONSTRUCTION OR IMPROVEMENT OF PUBLIC SCHOOLS IN THE COUNTY.

26 (C) (1) BONDS SHALL BE AUTHORIZED BY A RESOLUTION OF THE

27 GOVERNING BODY OF THE COUNTY.

28 (2) THE RESOLUTION SHALL:

29 (I) GENERALLY DESCRIBE THE PUBLIC SCHOOL CONSTRUCTION

30 OR IMPROVEMENTS TO BE FINANCED THROUGH THE SALE OF THE BONDS;

31 (II) STATE THE MAXIMUM PRINCIPAL AMOUNT OF THE BONDS;

32 (III) DESCRIBE THE SOURCES OF REPAYMENT OF THE BONDS;

33 (IV) STATE THE MAXIMUM TERM OF THE BONDS, WHICH MAY NOT

34 EXCEED 30 YEARS; AND

7 HOUSE BILL 1230

1 (V) DESCRIBE ANY TERMS OR CONDITIONS UNDER WHICH THE

2 BONDS MAY BE REDEEMED BEFORE MATURITY.

3 (D) THE BONDS SHALL:

4 (1) BE DATED AND BEAR INTEREST AT A RATE SPECIFIED IN THE

5 RESOLUTION;

6 (2) MATURE WITHIN 30 YEARS OF THE DATE OF ISSUANCE OF THE

7 BONDS;

8 (3) BE ISSUED AT, ABOVE, OR BELOW PAR VALUE, FOR CASH OR OTHER

9 CONSIDERATION;

10 (4) BE PAYABLE AT A TIME, IN THE DENOMINATION, IN REGISTERED

11 FORM, WITHIN THE MEANING OF ARTICLE 31, § 30 OF THE CODE, AS SPECIFIED IN

12 THE RESOLUTION;

13 (5) CARRY THE REGISTRATION AND PRIVILEGES AS TO CONVERSION

14 AND FOR THE REPLACEMENT OF MUTILATED, LOST, OR DESTROYED BONDS, AS

15 SPECIFIED IN THE RESOLUTION;

16 (6) BE PAYABLE IN LAWFUL MONEY OF THE UNITED STATES OF

17 AMERICA AT A DESIGNATED PLACE;

18 (7) BE SUBJECT TO THE TERMS AND CONDITIONS SPECIFIED IN THE

19 RESOLUTION; AND

20 (8) BE SOLD IN THE MANNER, INCLUDING PRIVATE OR NEGOTIATED

21 SALE, AND UPON THE TERMS, SPECIFIED IN THE RESOLUTION.

22 (E) THE COUNTY MAY ENTER INTO AGREEMENTS WITH AGENTS, BANKS,

23 FIDUCIARIES, INSURERS, OR OTHERS TO:

24 (1) ENHANCE THE MARKETABILITY OF AND SECURITY FOR THE BONDS;

25 OR

26 (2) SECURE ANY TENDER OPTION GRANTED TO THE HOLDERS OF THE

27 BONDS.

28 (F) IF ANY OFFICER WHOSE SIGNATURE APPEARS ON A BOND CEASES TO BE

29 AN OFFICER BEFORE DELIVERY OF THE BONDS, THE SIGNATURE IS VALID AND

30 SUFFICIENT FOR ALL PURPOSES.

31 (G) THE BONDS, THEIR ISSUE, AND THEIR SALE MAY BE EXEMPT FROM THE

32 PROVISIONS OF SECTIONS 9, 10, AND 11 OF ARTICLE 31 OF THE CODE.

33 (H) (1) EXCEPT AS PROVIDED IN PARAGRAPH (2) OF THIS SUBSECTION, THE

34 NET PROCEEDS OF THE SALE OF THE BONDS MAY ONLY BE APPLIED TO THE

35 CONSTRUCTION OR IMPROVEMENT OF PUBLIC SCHOOL FACILITIES, AS DESCRIBED

36 IN THE RESOLUTION AUTHORIZING THE ISSUANCE OF THE BONDS.

8 HOUSE BILL 1230

1 (2) IF THE NET PROCEEDS OF THE SALE OF ANY BONDS EXCEEDS THE

2 AMOUNT NEEDED FOR THE CONSTRUCTION OR IMPROVEMENT OF THE PUBLIC

3 SCHOOL FACILITIES, AS DESCRIBED IN THE RESOLUTION, THE EXCESS FUNDS SHALL

4 BE APPLIED TO:

5 (I) THE PAYMENT OF INTEREST ON THE BONDS;

6 (II) THE PAYMENT OF THE NEXT PRINCIPAL MATURITY OF THE

7 BONDS;

8 (III) THE REDEMPTION OF ANY PART OF THE BONDS THAT ARE

9 REDEEMABLE BEFORE MATURITY; OR

10 (IV) IF AUTHORIZED BY A RESOLUTION ISSUED BY THE GOVERNING

11 BODY OF THE COUNTY, THE CONSTRUCTION OR IMPROVEMENT OF OTHER PUBLIC

12 SCHOOL FACILITIES.

13 (I) BONDS ISSUED UNDER THIS SUBTITLE ARE NEGOTIABLE INSTRUMENTS

14 UNDER THE LAWS OF THIS STATE.

15 (J) BEFORE THE PREPARATION OF BONDS, THE COUNTY MAY ISSUE BOND

16 ANTICIPATION NOTES IN ACCORDANCE WITH ARTICLE 31, § 12 OF THE CODE.

17 5-603.

18 (A) BONDS ISSUED UNDER THIS SUBTITLE CONSTITUTE AN IRREVOCABLE

19 PLEDGE OF THE FULL FAITH AND CREDIT AND UNLIMITED TAXING POWER OF THE

20 COUNTY TO THE PAYMENT OF THE PRINCIPAL OF AND INTEREST ON THE BONDS

21 WHEN THE BONDS BECOME PAYABLE.

22 (B) (1) EXCEPT AS PROVIDED IN PARAGRAPH (3) OF THIS SUBSECTION, THE

23 GOVERNING BODY OF A COUNTY MAY IMPOSE A TRANSFER TAX ON AN INSTRUMENT

24 OF WRITING, AS DEFINED IN § 13-101(C) OF THE TAX - PROPERTY ARTICLE:

25 (I) RECORDED WITH THE CLERK OF THE CIRCUIT COURT FOR THE

26 COUNTY; OR

27 (II) FILED WITH THE STATE DEPARTMENT OF ASSESSMENTS AND

28 TAXATION.

29 (2) A TRANSFER TAX IMPOSED UNDER THIS SUBSECTION:

30 (I) MAY NOT EXCEED THE AMOUNT REQUIRED TO MAKE

31 PAYMENTS, WHEN DUE, ON THE PRINCIPAL OF AND INTEREST ON BONDS ISSUED TO

32 FUND PUBLIC SCHOOL CONSTRUCTION; AND

33 (II) DOES NOT APPLY TO AN INSTRUMENT OF WRITING EXEMPT

34 FROM THE STATE TRANSFER TAX UNDER § 13-207 OF THE TAX - PROPERTY ARTICLE.

35 (3) THIS SUBSECTION DOES NOT APPLY TO A COUNTY OTHERWISE

36 AUTHORIZED TO IMPOSE A TRANSFER TAX ON JUNE 30, 2004.

9 HOUSE BILL 1230

1 (C) (1) IN THIS SUBSECTION, "RETAIL SALE", "SALE", AND "TAXABLE PRICE"

2 HAVE THE MEANINGS STATED IN § 11-101 OF THE TAX - GENERAL ARTICLE.

3 (2) EXCEPT AS OTHERWISE PROVIDED IN THIS SUBSECTION, THE

4 GOVERNING BODY OF A COUNTY MAY IMPOSE, BY ORDINANCE, AND COLLECT A

5 SALES TAX ON A RETAIL SALE WITHIN THE COUNTY.

6 (3) A TAX IMPOSED UNDER THIS SECTION DOES NOT APPLY TO A SALE

7 THAT IS EXEMPT FROM THE STATE SALES AND USE TAX UNDER TITLE 11 OF THE TAX

8 - GENERAL ARTICLE.

9 (4) A TAX IMPOSED UNDER THIS SECTION MAY NOT EXCEED THE

10 AMOUNT REQUIRED TO MAKE PAYMENTS, WHEN DUE, ON THE PRINCIPAL OF AND

11 INTEREST ON BONDS ISSUED TO FUND PUBLIC SCHOOL CONSTRUCTION.

12 (D) (1) EXCEPT AS PROVIDED IN PARAGRAPH (2) OF THIS SUBSECTION, IN

13 EVERY FISCAL YEAR IN WHICH ANY OF THE BONDS ARE OUTSTANDING, THE COUNTY

14 SHALL LEVY AD VALOREM TAXES ON ALL ASSESSABLE PROPERTY WITHIN THE

15 CORPORATE LIMITS OF THE COUNTY IN AN AMOUNT SUFFICIENT TO MAKE

16 PAYMENTS, WHEN DUE, ON THE PRINCIPAL OF AND INTEREST ON THE BONDS.

17 (2) IF OTHER FUNDS ARE AVAILABLE TO PAY THE PRINCIPAL OF AND

18 INTEREST ON THE BONDS, THE COUNTY MAY REDUCE THE TAXES THAT WOULD

19 OTHERWISE NEED TO BE LEVIED UNDER THIS SECTION.

20 (E) THE COUNTY MAY APPLY FUNDS RECEIVED FROM ANY SOURCE TO THE

21 PAYMENT OF PRINCIPAL OF AND INTEREST ON THE BONDS.

22 5-604.

23 BONDS ISSUED UNDER THIS SUBTITLE ARE EXEMPT FROM STATE, COUNTY,

24 AND MUNICIPAL TAXATION.

25 Article - Tax - General

26 11-102.

27 (b) (1) A county, municipal corporation, special taxing district, or other

28 political subdivision of the State may not impose any retail sales or use tax except:

29 (i) a sales tax or use tax that was in effect on January 1, 1971;

30 (ii) a tax on the sale or use of:

31 1. fuels;

32 2. utilities;

33 3. space rentals; or

10 HOUSE BILL 1230

1 4. any controlled dangerous substance, as defined in § 5-101

2 of the Criminal Law Article, unless the sale is made by a person who registers under

3 and complies with Title 5, Subtitle 3 of the Criminal Law Article; [or]

4 (iii) a tax imposed by a code county on the sale or use of food and

5 beverages authorized under Article 25B, § 13H of the Code; OR

6 (IV) A SALES TAX IMPOSED BY A COUNTY AUTHORIZED TO IMPOSE A

7 SALES TAX UNDER § 5-603(C) OF THE EDUCATION ARTICLE.

8 (2) Paragraph (1) of this subsection may not be construed as conferring

9 authority to impose a sales and use tax.

10 SECTION 2. AND BE IT FURTHER ENACTED, That the Laws of Maryland

11 read as follows:

12 Article - Education

13 5-301.

14 (a) IN THIS SUBTITLE, "INTERAGENCY COMMITTEE" MEANS THE

15 INTERAGENCY COMMITTEE ON SCHOOL CONSTRUCTION ESTABLISHED UNDER §

16 5-302 OF THIS SUBTITLE.

17 (B) (1) For the purposes of this section other than subsection (c), the Board

18 of Public Works shall define by regulation what constitutes an [approved] ELIGIBLE

19 AND INELIGIBLE public school construction or capital improvement cost.

20 (2) (I) THE PURCHASE OF RELOCATABLE CLASSROOMS SHALL BE AN

21 ELIGIBLE PUBLIC SCHOOL CONSTRUCTION OR CAPITAL COST.

22 (II) THE BOARD OF PUBLIC WORKS SHALL ADOPT REGULATIONS

23 THAT DEFINE RELOCATABLE CLASSROOMS AND ESTABLISH THE MINIMUM

24 SPECIFICATIONS FOR RELOCATABLE CLASSROOMS WHICH MAY BE PURCHASED

25 USING STATE FUNDS.

26 (III) IN THE BUDGETS FOR FISCAL YEARS 2006 THROUGH 2008, THE

27 GOVERNOR SHALL INCLUDE $1,000,000 FOR PUBLIC SCHOOL CONSTRUCTION, IN

28 EXCESS OF THE ESTIMATES OF FUNDING FOR PUBLIC SCHOOL CONSTRUCTION

29 CONTAINED IN THE FISCAL YEAR 2005 THROUGH FISCAL YEAR 2009 CAPITAL

30 IMPROVEMENT PLAN, TO BE USED TO FUND THE STATE SHARE OF THE COST OF

31 PURCHASING RELOCATABLE CLASSROOMS.

32 (3) The cost of acquiring land may not be considered a construction or

33 capital improvement cost and may not be paid by the State.

34 [(b)] (C) The State shall pay the costs in excess of available federal funds of

35 [all] THE STATE SHARE OF public school construction projects and public school

36 capital improvements in each county if:

11 HOUSE BILL 1230

1 (1) The projects or improvements have been approved by the Board of

2 Public Works; and

3 (2) Contracts have been executed on or after July 1, 1971 for the projects

4 or improvements.

5 [(c) (1) In this subsection, "local debt for school construction" includes any

6 debt incurred as the result of money made available to a county under a bond issue

7 that obligates the credit of the State.

8 (2) Except for general public school construction loan debt outstanding

9 or obligated as of June 30, 1967 for which repayment by a county is no longer

10 required, the State shall reimburse each county for the full costs of principal and

11 interest payments on any local debt for school construction outstanding or obligated

12 as of June 30, 1967.

13 (d) The State shall pay all of the annual cost of debt service on school

14 construction debt incurred by each county that was outstanding or obligated on or

15 after June 30, 1967 for contracts let before June 30, 1967.]

16 [(e)] (D) (1) The Board of Public Works may adopt [rules, regulations, and

17 procedures] REGULATIONS for the administration of the programs provided for [by

18 subsections (b) and (d) of] IN this section.

19 (2) The [rules, regulations, and procedures] REGULATIONS adopted by

20 the Board of Public Works may contain requirements for:

21 (i) The development and submission of long range plans;

22 (ii) The submission of annual plans and plans for specific projects;

23 (iii) The submission of other data or information that is relevant to

24 school construction or capital improvement;

25 (iv) The approval of sites, plans, and specifications for the

26 construction of new school buildings or the improvement of existing buildings;

27 (v) Site improvements;

28 (vi) Competitive bidding;

29 (vii) The hiring of personnel in connection with school construction

30 or capital improvements;

31 (viii) The actual construction of school buildings or their

32 improvements;

33 (ix) The relative roles of different State and local governmental

34 agencies in the planning and construction of school buildings or school capital

35 improvements; [and]

12 HOUSE BILL 1230

1 (x) School construction and capital improvements necessary or

2 appropriate for the proper implementation of this section;

3 (XI) AT THE RECOMMENDATION OF THE INTERAGENCY

4 COMMITTEE, THE ESTABLISHMENT OF PRIORITY PUBLIC SCHOOL CONSTRUCTION

5 PROGRAMS;

6 (XII) DEVELOPMENT OF COOPERATIVE ARRANGEMENTS THAT

7 PERMIT THE SHARING OF FACILITIES AMONG TWO OR MORE SCHOOL SYSTEMS;

8 (XIII) THE SELECTION OF ARCHITECTS AND ENGINEERS BY SCHOOL

9 SYSTEMS;

10 (XIV) THE AWARD OF CONTRACTS BY SCHOOL SYSTEMS; AND

11 (XV) METHOD OF PAYMENTS MADE BY THE STATE UNDER THE

12 PUBLIC SCHOOL CONSTRUCTION PROGRAM.

13 (3) THE REGULATIONS ADOPTED BY THE BOARD OF PUBLIC WORKS

14 SHALL CONTAIN PROVISIONS:

15 (I) ESTABLISHING A STATE AND LOCAL COST-SHARE FORMULA

16 FOR EACH COUNTY THAT IDENTIFIES THE FACTORS USED IN ESTABLISHING THE

17 FORMULAS;

18 (II) REQUIRING LOCAL EDUCATION AGENCIES TO ADOPT

19 EDUCATIONAL FACILITIES MASTER PLANS AND ANNUAL CAPITAL IMPROVEMENT

20 PROGRAMS;

21 (III) PROVIDING A METHOD FOR ESTABLISHING A MAXIMUM STATE

22 CONSTRUCTION ALLOCATION FOR EACH PROJECT APPROVED FOR STATE FUNDING;

23 (IV) REFERENCING THE POLICIES STATED IN § 5-7B-07 OF THE

24 STATE FINANCE AND PROCUREMENT ARTICLE;

25 (V) REQUIRING LOCAL SCHOOL SYSTEMS TO ADOPT PROCEDURES

26 CONSISTENT WITH THE MINORITY BUSINESS ENTERPRISE POLICIES OF THE STATE

27 AS REQUIRED UNDER THE CODE OF MARYLAND REGULATIONS;

28 (VI) ESTABLISHING A PROCESS FOR THE APPEAL OF DECISIONS BY

29 THE INTERAGENCY COMMITTEE TO THE BOARD OF PUBLIC WORKS;

30 (VII) REQUIRING LOCAL EDUCATION AGENCIES TO ADOPT,

31 IMPLEMENT, AND PERIODICALLY UPDATE COMPREHENSIVE MAINTENANCE PLANS;

32 AND

33 (VIII) AUTHORIZING THE BOARD OF PUBLIC WORKS TO WITHHOLD

34 STATE PUBLIC SCHOOL CONSTRUCTION FUNDS FROM A LOCAL EDUCATION AGENCY

35 THAT FAILS TO COMPLY WITH THE REQUIREMENTS OF ITEM (VII) OF THIS

36 PARAGRAPH.

13 HOUSE BILL 1230

1 (4) In adopting any of these requirements, the State Board and the

2 Board of Public Works shall provide for the maximum exercise of initiative by school

3 personnel in each county to insure that the school buildings and improvements meet

4 both the needs of the local communities and the rules and regulations necessary to

5 insure the proper operation of this section and the prudent expenditure of State

6 funds.

7 [(f)] (E) [(1)] The Board of Public Works shall develop the rules, regulations,

8 and procedures authorized by this section in consultation with representatives of the

9 county boards and the county governing bodies.

10 [(2) Before the adoption, amendment, or repeal of any rule, regulation, or

11 procedure under this section, the Board of Public Works shall give notice of its

12 intended action to the county boards and to the county governing bodies.

13 (3) The Board of Public Works shall permit each county board and

14 county governing body to submit its views with respect to the intended action.]

15 [(g)] (F) The [rules, regulations, and procedures] REGULATIONS AND

16 PROCEDURES of the Board of Public Works adopted under this section and their

17 promulgation are exempt from [§§ 10-101 through 10-305 of the State Government

18 Article and] § 8-127(b) of the State Finance and Procurement Article of the Code.

19 [(h)] (G) (1) With respect to public school construction or public school

20 capital improvements, including sites for school buildings, the authority,

21 responsibilities, powers, and duties of the following are subject to the [rules,

22 regulations, and procedures] REGULATIONS adopted by the Board of Public Works

23 under this section:

24 (i) The State Board;

25 (ii) The State Superintendent;

26 (iii) The county governments;

27 (iv) The county boards; and

28 (v) All other State or local governmental agencies under this

29 article.

30 (2) If, as to public school construction or public school capital

31 improvements, there is any conflict between the [rules, regulations, and procedures]

32 REGULATIONS AND PROCEDURES of the Board of Public Works and the authority,

33 responsibilities, powers, and duties of the individuals and agencies specified in

34 paragraph (1) of this subsection, the[ rules, regulations, and procedures]

35 REGULATIONS AND PROCEDURES of the Board of Public Works shall prevail.

36 [(i)] (H) The obligation of the State to pay the costs of public school

37 construction and public school capital improvements extends only to those projects or

14 HOUSE BILL 1230

1 parts of projects that comply with the [rules, regulations, and procedures]

2 REGULATIONS AND PROCEDURES of the Board of Public Works.

3 [(j)] (I) (1) This subsection does not apply to the proceeds from the sale,

4 lease, or disposition of public school buildings constructed under contracts executed

5 before February 1, 1971.

6 (2) [By rule or regulation] CONSISTENT WITH § 4-115 OF THIS ARTICLE

7 AND REGULATIONS ADOPTED BY THE BOARD OF PUBLIC WORKS TO IMPLEMENT §

8 4-126 OF THIS ARTICLE, the Board of Public Works may require BY REGULATION that

9 the proceeds received by a county from the sale, lease, or disposal of any public school

10 building shall be used solely as part of the State funding of the construction of future

11 public school buildings in the county in which the sale, lease, or disposal occurred, if

12 the public school building was:

13 (i) Constructed under a contract executed on or after February 1,

14 1971; and

15 (ii) Paid for primarily with State funds under this section.

16 (3) The part of the proceeds from the sale, lease, or disposal of a public

17 school building that fairly represents the appraised value of land and that part of the

18 cost of the public school building that was funded by the county shall remain as the

19 funds of the county.

20 [(k)] (J) (1) Whether by budget bill or supplementary appropriation bill, all

21 money appropriated to carry out the purposes of this section is a separate fund that

22 shall be administered by the State Comptroller in accordance with the [rules and]

23 regulations adopted by the Board of Public Works.

24 (2) (I) EXCEPT AS PROVIDED IN SUBPARAGRAPH (II) OF THIS

25 PARAGRAPH, NOTWITHSTANDING ANY OTHER CONTRARY PROVISION OF THE

26 ANNOTATED CODE, ANY FUNDS APPROVED FOR A PROJECT THAT HAS NOT BEEN

27 CONTRACTED FOR WITHIN 2 YEARS OF THE APPROVAL OF THE PROJECT SHALL

28 REVERT TO THE FUND ESTABLISHED UNDER PARAGRAPH (1) OF THIS SUBSECTION.

29 (II) THE INTERAGENCY COMMITTEE, WITH THE APPROVAL OF THE

30 BOARD OF PUBLIC WORKS, MAY EXTEND THE TIME PERIOD UNDER SUBPARAGRAPH

31 (I) OF THIS PARAGRAPH IF THE INTERAGENCY COMMITTEE DETERMINES THAT

32 UNUSUAL CIRCUMSTANCES EXIST.

33 (3) ANY UNEXPENDED ALLOCATIONS OF FUNDS FOR PREVIOUSLY

34 APPROVED PROJECTS SHALL BE TRANSFERRED TO THE FUND ESTABLISHED UNDER

35 PARAGRAPH (1) OF THIS SUBSECTION.

36 (4) ON OR BEFORE JUNE 1 AND DECEMBER 1 OF EACH YEAR, THE

37 INTERAGENCY COMMITTEE SHALL REPORT TO THE GENERAL ASSEMBLY, IN

38 ACCORDANCE WITH § 2-1246 OF THE STATE GOVERNMENT ARTICLE, ON THE

39 BALANCE IN THE FUND AS THE RESULT OF TRANSFERS OR REVERSIONS REQUIRED

40 UNDER THIS SUBSECTION.

15 HOUSE BILL 1230

1 SECTION 3. AND BE IT FURTHER ENACTED, That the Laws of Maryland

2 read as follows:

3 Article - Education

4 5-301.

5 (a) IN THIS SUBTITLE, "INTERAGENCY COMMITTEE" MEANS THE

6 INTERAGENCY COMMITTEE ON SCHOOL CONSTRUCTION ESTABLISHED UNDER §

7 5-302 OF THIS SUBTITLE.

8 (B) (1) For the purposes of this section other than subsection (c), the Board

9 of Public Works shall define by regulation what constitutes an [approved] ELIGIBLE

10 AND INELIGIBLE public school construction or capital improvement cost.

11 (2) The cost of acquiring land may not be considered a construction or

12 capital improvement cost and may not be paid by the State.

13 [(b)] (C) The State shall pay the costs in excess of available federal funds of

14 [all] THE STATE SHARE OF public school construction projects and public school

15 capital improvements in each county if:

16 (1) The projects or improvements have been approved by the Board of

17 Public Works; and

18 (2) Contracts have been executed on or after July 1, 1971 for the projects

19 or improvements.

20 [(c) (1) In this subsection, "local debt for school construction" includes any

21 debt incurred as the result of money made available to a county under a bond issue

22 that obligates the credit of the State.

23 (2) Except for general public school construction loan debt outstanding