2016 Maryland Code
Transportation
Title 3 - Financing by Department
Subtitle 6 - Special Bonds and Borrowings
§ 3-606. Trust agreement

(a) In general. --

(1) Bonds issued under this subtitle may be secured by a trust agreement between the Department and a corporate trustee, which may be any trust company or bank having trust powers within or without the State.

(2) The trust agreement may pledge or assign:

(i) All or any part of the existing and anticipated federal funds paid to or expected to be paid to the Department for transportation purposes; or

(ii) Revenue from a dedicated revenue source, which may include revenues attributable to the transportation facilities being financed.

(3) The trust agreement may not pledge or assign any State tax revenues pledged to meet debt service on Consolidated Transportation Bonds as prescribed under § 3-215 of this title.

(b) Contents. -- Any trust agreement or bond authorizing resolution may:

(1) Contain provisions for the protection and enforcement of the rights and remedies of bondholders as are considered reasonable and proper, including covenants setting forth the duties of the Department as to the financing or development of any transportation facility, the extension, enlargement, improvement, maintenance, operation, repair, and insurance of the transportation facility, and the custody, safeguarding, and application of money;

(2) Provide for the employment of consulting engineers in connection with the construction or operation of any transportation facility;

(3) Set forth the rights and remedies of the bondholders and of the trustee;

(4) Restrict the individual right of action by bondholders; and

(5) Contain any other provisions that the Department considers reasonable and proper for the security of the bondholders.

(c) Expenses incurred. -- All expenses incurred in carrying out the trust agreement may be treated as a part of the cost of the operation of the transportation facility in connection with which the bonds have been issued.

(d) Proceeds from sale. -- The proceeds of the sale of bonds shall be paid to the trustee under the trust agreement securing the bonds and shall be disbursed in the manner and under the restrictions, if any, provided in the trust agreement.

(e) Indemnifying bonds or pledge issued by a bank or trust company. -- Any bank or trust company incorporated under the laws of this State that acts as depositary of the proceeds of the bonds or of revenues may furnish any indemnifying bonds or pledge any securities that the Department requires.