Md. Code Regs. 14.39.02.27

Current through Register Vol. 51, No. 24, December 2, 2024

Section 14.39.02.27 - Assumption of State Debt, Capital Lease Financing Balances, and Disposition Proceeds

A. Pursuant to Education Article, § 5-308, Annotated Code of Maryland, the IAC:

(1) Shall require reimbursement of debt service from a county for a school property that:

(a) Is sold by the county government; or

(b) Meets all the following:

(i) Was initially constructed or substantially altered by additions, alterations, or renovations, and the cost of the construction at the time of execution exceeded $100,000, and the work was accomplished after February 1, 1971;

(ii) Is no longer used for school purposes;

(iii) Has had title transferred to county government;

(iv) Is being used for local governmental purposes by the State or county, or by any instrumentality of the State or county other than public education; and

(v) Has outstanding debt that exceeds $5,000;

(2) May require reimbursement of debt service or capital lease financing balances, or both, from a county for a school property that:

(a) Has remaining State debt for bonds or capital lease financing balances;

(b) Is no longer used for school purposes;

(c) Has had title transferred to county government; and

(d) Is not being used for local governmental purposes by the State or county, or by any instrumentality of the State or county.

B. Reimbursement for Transferred School Building.

(1) A county government is not required to reimburse the State for outstanding debt service for a school building that is transferred to the county government in accordance with §A of this regulation until 2 years after the school building is transferred.

(2) After the 2-year period ends, the county government shall reimburse the State for outstanding debt service for a school building in the amount that the county government would have been required to pay when the school building was transferred to the county.

C. The IAC may require the county to pay the State a proportional share of the disposition proceeds based on the proportion of the State's investment in the school property.

D. The IAC may establish any method of payment of the bond debt or the disposition proceeds including a lump sum payment or an assumption or re-assumption of existing bond debt.

Md. Code Regs. 14.39.02.27

Regulation .27 amended and recodified from 23.03.02.28 effective 46:22 Md. R. 976, eff. 11/4/2019; recodified from .26 effective 48:13 Md. R. 509, eff. 6/28/2021; recodified from .26 effective 51:15 Md. R. 711, eff. 8/5/2024.