AGENDA ITEM #4
March 20, 2012
Introduction
MEMORANDUM
March 16,2012
TO:
FROM:
SUBJECT:
County Council
Jacob Sesker, Senior Legislative Analyst
({rJ'
Introduction:
Expedited Bill 12-12, Bond Authorization - Stormwater Management
Expedited Bill 12-12, Bond Authorization Stormwater Management, sponsored by the Council
President at the request of the County Executive, is scheduled to be introduced on March 20,2012. A
public hearing is tentatively scheduled for April 10 at 1:30 p.m.
Bill 12-12 authorizes the County to issue special limited obligation bonds for the purposes of
financing the planning, design, acquisition, and construction of stormwater management facilities and
other related projects.
This packet contains
Expedited Bi1l12-12
Legislative Request Report
Memo from County Executive
Circle
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Expedited Bill No. ....!.;12"'---'.1"'-2_ _ _ __
Concerning: Bond Authorization -
Stormwater Management
Revised:
3/9/2012
Draft No._1_
Introduced:
March 20,2012
Expires:
September 20,2013
Enacted: _ _ _ _ _ _ _ _ __
Executive: _ _ _ _ _ _ _ __
Effective: _ _ _ _ _ _ _ _ __
Sunset Date: ....:Nc..:,;o::.:.n""'e:...-_ _ _ _ __
Ch. _ _, Laws of Mont. Co. _ __
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
By: Council President at the Request of the County Executive
AN EXPEDITED ACT
to authorize the County to issue special limited obligation bonds to
finance the planning, design, acquisition, and construction of stormwater management facilities
and related projects.
By adding to the Laws of Montgomery County 2012
Boldface
Underlining
[Single boldface brackets]
Double underlining
[[Double boldface brackets]]
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*
*
Heading or defined term.
Added to existing law by original bill.
Deleted from existing law by original bill.
Added by amendment.
Deleted from existing law or the bill by amendment.
Existing law unaffected by bill.
The County Council for Montgomery County, Maryland approves the following Act:
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EXPEDITED BILL
No. 12-12
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Sec.
1.
The following is added to the Laws of Montgomery County
2012:
(
a)
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The County may at any time and from time to time sell in one or more
series an aggregate principal amount not to exceed $95,000,000 in
special limited obligation bonds (the "Bonds") authorized under the
authority of Section 5(P)(2) of Article 25A of the Maryland Code
Title 4 of the Environmental Article of the Maryland Code ("Title
4"), as amended and Chapter 19 of the County Code, as amended to
finance the planning, design, acquisition, and construction of
stormwater management facilities and related projects as approved in
the County's Capital Improvements Program.
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(b) The Bonds are special limited obligations of the County and must not
constitute a pledge of the full faith and credit and unlimited taxing
power of the County. The Bonds must be payable by the County from
its water quality protection charges authorized to be imposed on
certain real property
in
the County under Title 4 and Section 19-35 of
the County Code (the "Water Quality Protection Charge") and
deposited into the stormwater management fund (the "Fund"). To pay
the interest and redeem and pay the Bonds authorized by this Act as
they respectively mature, the County must impose the Water Quality
Protection Charge in each fiscal year in an amount sufficient to
provide for the payment, when due, of the principal of and interest on
all Bonds maturing in each fiscal year and all other costs and expenses
authorized for payment and determined to be paid by the County from
the Fund in that fiscal year under Chapter 19. If the revenue derived
from the Water Quality Protection Charge imposed in any fiscal year
proves inadequate for the listed purposes, additional charges must be
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EXPEDITED Bill
No. 12-12
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imposed in the next fiscal year to make up any deficiency.
The
County may apply to the payment of the principal of and interest on
the Bonds and such other costs and expenses any other funds legally
available and deposited to the Fund. To the extent such funds are
received or are receivable in any fiscal year, the amount of the Water
Quality Protection Charge required to be imposed may be reduced
accordingly.
(c)
The Bonds may be sold for a price at or above par, plus accrued
interest to the date of delivery. The County Executive may sell the
Bonds through a public sale or through a private (negotiated) sale
without solicitation of competitive bids, as the Comity Executive by
executive order after consulting the Director of Finance finds to be in
the best interests of the County. Any sale of the Bonds by private
negotiation is for the County's best interest.
(d)
In accordance with this Act, the County Executive may determine by
Executive Order, for each Bond or series of Bonds issued under this
Act, all matters relating to the sale, issuance, delivery and payment of
the Bonds, including the purposes for which the Bonds are issued, the
date or dates of sale of the Bonds, the designation of the Bonds, the
date of delivery of the Bonds, the authorized denominations for the
Bonds, the redemption provisions, if any, pertaining to the Bonds, the
manner of authentication and numbering of the Bonds, the date from
which interest on the Bonds accrues, the rate or rates of interest borne
by the Bonds or the method of determining the rates, the interest
payment and maturity dates of the Bonds, including provisions for
mandatory sinking fund redemption of any term bonds, the forms of
the Bonds, whether the Bonds are to be issued in book-entry form and
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EXPEDITED BILL No.
12-12
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all matters incident to the issuance of Bonds in book-entry form, and
the provisions for the registration of Bonds.
The execution and
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delivery of Bonds is conclusive evidence of the approval of all terms
and provisions of the Bonds on behalf of the County.
(e)
Except as otherwise provided in an Executive Order, the Bonds must
be executed in the name of the County and on its behalf by the County
Executive, whose signature may be by facsimile; an original or
facsimile of the official seal of the County must be imprinted or
otherwise reproduced thereon, attested by the manual or facsimile
signature of the Director of Finance, and authenticated by the manual
or facsimile signature of the Paying AgentlRegistrar or any designated
sIgner.
(f)
The County hereby covenants that if the County Executive decides to
issue the Bonds as tax-exempt bonds or bonds that must comply with
regulations regarding tax -exempt bonds, the County will take, or
refrain from taking, all actions necessary to comply with Section 103
and Sections 141 through 150 of the Internal Revenue Code,
applicable to the Bonds issued as tax-exempt bonds to preserve the
status of the interest on the Bonds as excluded from gross income for
Federal income tax purposes. Without limiting the generality of the
covenant in the preceding sentence: (1) the County must not use or
permit the use of any proceeds of the Bonds issued as tax-exempt
bonds or any funds of the County in a manner as would cause the
interest on the Bonds to be included in gross income for Federal
income tax purposes; (2) the County must regulate the investment of
the proceeds of the Bonds so as not to cause any of the Bonds to be an
"arbitrage bond" within the meaning of Section 148 of the Internal
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ExPEDITED BILL
No. 12-12
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Revenue Code and the Income Tax Regulations thereunder; (3) the
County must, if and to the extent necessary, make periodic
determinations of the rebate amount and timely pay any rebate
amount, or installment thereof, to the United States of America; (4)
the County must prepare and timely file Internal Revenue Service
Form 8038-G and 8038-B, Information Return for Tax-Exempt
Governmental Obligations; and (5) the County Executive or the
Executive designee must prepare and execute and certify any other
document required to assure compliance with the applicable
prOVISIons of Section 103 and Sections 141 through 150 of the
Internal Revenue Code, and the Income Tax Regulations thereunder.
The County Executive may take any actions necessary or desirable to
assure that any Bonds authorized by this Act are allowed a tax credit,
that the County is entitled to a subsidy from the United States or any
agency or instrumentality thereof with respect to such Bonds or the
interest payable thereon, or the interest thereon is entitled to any other
available benefits under the Internal Revenue Code, as amended.
(g)
In connection with the issuance of any Bonds under this Act, the
County may enter into one or more agreements as the County
Executive finds necessary or appropriate for the issuance, sale,
delivery or security of the Bonds, which may include:
(1)
underwriting, purchase or placement agreements for Bonds sold at
private (negotiated) sale in accordance with this Act; (2) trust
agreements with commercial banks or trust companies for the
issuance and security of the Bonds; (3) any dealer, remarketing or
similar agreements for the placement or remarketing of the Bonds; (4)
agreements for any credit or liquidity facilities supporting any Bonds;
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EXPEDITED BILL NO.
12-12
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(5) agreements with commercial banks or trust companies for the
deposit of proceeds of any Bonds; (6) agreements with fiscal agents
for the issuance of Bonds, their authentication, registration or payment
or other similar services; and (7) continuing disclosure agreements,
including any agreement required to enable the underwriters of any
Bonds to meet the requirements of paragraph (b)( 5) of Rule 15c2-12
issued by the Securities and Exchange Commission.
Each such
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agreement must take the form determined by the County Executive by
Executive Order.
(h)
The County Executive, the Chief Administrative Officer, the County
Attorney, the Director of Finance and the Clerk of the Council, on
behalf of the County, may execute all instruments and otherwise take
any action necessary to carry out the authority conferred by this Act.
(i)
The issuance and sale of any bonds under this Act are exempt from
the provisions of Article 31, Sections 9, 10, and 11 of the Maryland
Code.
Sec. 2.
Expedited Effective Date.
The Council declares that this legislation is necessary for the immediate
protection of the public interest. This Act takes effect on the date on which it
becomes law.
Approved:
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Roger Berliner, President, County Council
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Date
Approved:
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Isiah Leggett, County Executive
Date
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LEGISLATIVE REQUEST REPORT
Expedited Bill 12-12
Bond Authorization
-
Stormwater Management
DESCRIPTION:
Legislation to authorize the issuance of special obligation bonds in an
amount not to exceed $95,000,000. The Bonds will be Special
Limited Obligations of the County secured by the Water Quality
Protection Charge and will not constitute a pledge of the full faith
and credit and unlimited taxing power of the County.
An Ordinance is necessary to establish the level of debt that may be
secured by the Water Quality Protection Charge authorized under
Section 19-35 of Chapter 19 of the County Code and to authorize
actions by the County Executive to execute documents related to the
issuance and delivery of Water Quality Protection Charge Revenue
Bonds (the "Bonds").
The goal is to provide new bond authorization for the planning,
design, acquisition and construction of stonnwater management
facilities and other related projects. The bonds will be sold in one or
more series in an aggregate amount not to exceed $95,000,000 as
currently approved for projects in the FY11-16 Amended Capital
Improvements Program to be funded by Water Quality Protection
Charge bonds.
This bill is new legislation that does not duplicate or overlap existing
law.
Future annual debt service costs are incurred at the time the bonds are
actually sold, and are included in the Approved Operating Budget
and Annual Appropriations for Debt Service.
To be requested.
To be requested.
To be researched.
Jacob Sesker, Senior Legislative Analyst, 240-777-7942
To be researched.
PROBLEM:
GOALS AND
OBJECTIVES:
COORDINATION:
FISCAL IMP ACT:
ECONOMIC
IMPACT:
EVALUATION:
EXPERIEN CE
ELSEWHERE:
SOURCE OF
INFORMATION:
APPLICATION
WITHIN
MUNICIPALITIES:
PENALTIES:
Not applicable
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OFFICE OFTHE COUNTY EXECUTIVE
ROCKVlLLG, MARYLAND 20850
lsiah Leggett
County Executive
MEMORANDUM
March 2, 2012
TO:
Roger Berliner, President
Montgomery County Council
IsiahLeggett
County Executive
~
FROM:
~~
-0'
6" -. .
SUBJECT:
Legislation Related to Special Limited Obligation Bonds Financed by the Water Quality
Protection Charge
I
am transnlitting the attached bill to authorize the C.ounty to issue Special Limited
Obligati.on Bonds for the purpose of fmancing the planning, design, acquisition and construction of
stormwater management facilities and other related projects, The bill was prepared by the County's bond
cOWlsel, McKennon Shelton
&
Henn LLP, approved by the County Attorney for legal sufficiency and
reviewed by the Department of Finance.
An
Ordinance is necessary to establish the level of debt that
may
be secured by the Water Quality Protection Charge authorized under Section 19-35 of Chapter 19 of
the County Code and to authorize actions by the County Executive
to
execute docUments related to the
issuance and delivery of Water Quality Protection Charge Revenue Bonds (the "Bonds").
The Bonds will be sold in one .or more series in an aggregate amount not to exceed
$95,000,000 as currently approved for projects in the FYl1-16 Amended Capital Improvements Program
to
be
funded by Water Quality Protection Charge (WQPC) Revenue Bonds. The Bonds will be special
limited obligations of the County secured by the WQPC and will not constitute
a
pledge ofthe
full
faith
and credit and Wllimited
taxing
power of the County. The Water Quality Protection Charge will
be
set
annually at a rate to provide for payment of debt service on the Bonds and other costs of the stormwater
management program authorized to be paid from the Charge.
I
recommend that this bill be enacted on an expedited basis in order to comply with the
need for a late spring 2012 bond issue.
!fyou have any questions please contact Joseph F. Beach at extension 7-8870.
IL:jc
Attachments
cc: Robert Hoyt, Director, DEP
Jennifer Hughes, Director, OMB