2013 Maryland Code
HOUSING AND COMMUNITY DEVELOPMENT
§ 12-702 - Nature of bonds

§12-702.

(a) Bonds of an authority are issued for an essential public and governmental purpose.

(b) (1) Neither a commissioner of an authority nor a person who executes the bond for an authority is personally liable on the bonds.

(2) Neither the State nor a political subdivision is liable on the bonds.

(c) The bonds of an authority:

(1) are not a debt of the State or a political subdivision and shall state so on their face;

(2) are payable only out of money or property of the authority; and

(3) are not an indebtedness for purposes of a constitutional or statutory debt limitation or restriction.

(d) Bonds issued under this Division II and their transfer and the income from them, including any profit made on their sale, shall be free from taxation of every kind by the State and by all political subdivisions.

(e) Bonds issued by an authority are negotiable for the purposes of the Maryland Uniform Commercial Code, subject to the registration provisions of the Code.

(f) (1) Bonds issued by an authority are securities in which money may be invested by:

(i) public officers and governmental units of the State or its political subdivisions;

(ii) banks, trust companies, savings and loan associations, investment companies, and others carrying on a banking business;

(iii) insurance companies, insurance associations, and others carrying on an insurance business;

(iv) personal representatives, guardians, trustees, and other fiduciaries; and

(v) all other persons.

(2) Money that may be invested in the bonds includes capital that an investor owns or controls.

(g) Bonds issued by an authority are securities that may be deposited with or received by any State or municipal officer, governmental unit, or political subdivision of the State for any purpose for which the deposit of bonds of the State is authorized by law.

(h) (1) This subsection:

(i) is intended only for any public approval requirement of the Internal Revenue Code relating to the issuance of tax-exempt obligations; and

(ii) does not determine whether an authority is a governmental unit of the State or of a political subdivision.

(2) Subject to paragraph (1) of this subsection, an authority authorized under a resolution or ordinance of a political subdivision derives its authorization from the resolution or enactment rather than directly from State law.