EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*hb0674*
HOUSE BILL 674
P1 3lr1972
CF SB 425
By: Delegate Watson
Introduced and read first time: February 6, 2023
Assigned to: Appropriations
A BILL ENTITLED
AN ACT concerning 1
Maryland Historic Trust – Historic Preservation Partnership Program and 2
Fund – Established 3
FOR the purpose of establishing the Historic Preservation Partnership Program in the 4
Maryland Historic Trust to implement and encourage the preservation of historic 5
properties in partnership with a qualified cooperating nonprofit organization; 6
establishing the Historic Preservation Partnership Fund as a special, nonlapsing 7
fund; requiring certain funds to be transferred by the Trust to the qualified 8
cooperating nonprofit organization by a certain date each year; requiring the 9
Governor to transfer certain funds to the Partnership Fund by a certain date; 10
transferring the funds of the Historic Preservation Loan Fund to the Partnership 11
Fund and dissolving the Historic Preservation Loan Fund; and generally relating to 12
the Historic Preservation Partnership Program and Fund. 13
BY repealing 14
Article – State Finance and Procurement 15
Section 5A–327 16
Annotated Code of Maryland 17
(2021 Replacement Volume and 2022 Supplement) 18
BY adding to 19
Article – State Finance and Procurement 20
Section 5A–327 21
Annotated Code of Maryland 22
(2021 Replacement Volume and 2022 Supplement) 23
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 24
That the Laws of Maryland read as follows: 25
Article – State Finance and Procurement 26
2 HOUSE BILL 674
[5A–327. 1
(a) (1) In this section the following words have the meanings indicated. 2
(2) “MHT Loan Fund” means the Historic Preservation Loan Fund of the 3
Trust. 4
(3) “MHT Loan Program” means the Historic Preservation Loan Program 5
of the Trust. 6
(b) (1) There is an MHT Loan Program in the Trust. 7
(2) The purpose of the MHT Loan Program is to implement and encourage 8
the preservation of historic properties. 9
(3) The Trust shall administer the MHT Loan Program and coordinate the 10
MHT Loan Program with federal and State programs that complement or facilitate 11
carrying out the MHT Loan Program. 12
(c) There is an MHT Loan Fund in the Trust. 13
(d) The MHT Loan Fund may be used: 14
(1) to pay administrative costs directly related to the MHT Loan Program; 15
(2) to pay for the Trust to acquire historic properties or interests in historic 16
properties for its authorized purposes or for resale or lease subject to appropriate 17
preservation covenants; 18
(3) to pay costs, including preparation costs, to restore or rehabilitate 19
historic properties owned by the Trust for: 20
(i) the Trust’s authorized purposes; or 21
(ii) resale or lease subject to appropriate preservation covenants; or 22
(4) to make loans to nonprofit organizations, political subdivisions, 23
business entities, and individuals to: 24
(i) acquire, rehabilitate, restore, or refinance historic properties; or 25
(ii) provide short–term financing for costs, including preparation 26
costs, directly related to work that the Trust or the State Historic Preservation Officer 27
requires or recommends to be undertaken before a construction project financed with 28
federal or State money is begun or continued. 29
HOUSE BILL 674 3
(e) (1) The MHT Loan Fund is a continuing, nonlapsing special fund that is 1
not subject to § 7–302 of this article. 2
(2) The State Treasurer shall hold and the Comptroller shall account for 3
the MHT Loan Fund. 4
(f) The MHT Loan Fund consists of: 5
(1) money appropriated in the State budget to the MHT Loan Program; 6
(2) money received as interest or repayment of principal on loans made 7
under the MHT Loan Program or the Capital Revolving Fund for Historic Preservation; 8
(3) the proceeds from the resale or lease of property originally acquired by 9
the Trust with money from the MHT Loan Fund or the Capital Revolving Fund for Historic 10
Preservation; 11
(4) money received from other public or private sources for the benefit of 12
the MHT Loan Fund; and 13
(5) money received from the sale of general obligation bonds. 14
(g) Money in the MHT Loan Fund shall be invested in the same manner as other 15
State money. 16
(h) (1) The Department shall adopt regulations to carry out the purposes of 17
the MHT Loan Program. 18
(2) The regulations shall include: 19
(i) application procedures; 20
(ii) procedures to give adequate notice to the public of assistance 21
available under the MHT Loan Program; 22
(iii) provisions for the review of plans and specifications; 23
(iv) provisions for the inspection of projects during construction; and 24
(v) selection criteria the Trust must consider in evaluating loan 25
applications, including: 26
1. the relative historical or cultural significance of, and the 27
urgency of need for, the project to be financed by the loan; 28
2. any proposed contribution by the appropriate political 29
subdivision to the project; 30 4 HOUSE BILL 674
3. the geographic distribution of loan assistance from the 1
MHT Loan Fund; and 2
4. other relevant factors. 3
(i) (1) With the approval of the Secretary, for each loan the Trust may set: 4
(i) the principal amount; 5
(ii) the maturity; 6
(iii) the repayment terms; and 7
(iv) an interest rate that complies with applicable federal regulations 8
governing State borrowing. 9
(2) A loan from the MHT Loan Fund may be granted at an interest rate 10
lower than rates on other loans from the MHT Loan Fund if: 11
(i) the loan recipient is a nonprofit organization or a political 12
subdivision; or 13
(ii) the Secretary of Housing and Community Development 14
determines under § 4–212 of the Housing and Community Development Article that after 15
restoration or rehabilitation, the historic property will be wholly or partly occupied by 16
individuals or families of limited income. 17
(3) A loan from the MHT Loan Program may be secured by: 18
(i) a mortgage lien, which may be subordinate to other mortgage 19
liens; 20
(ii) a guarantee of repayment; or 21
(iii) another form of collateral acceptable to the Trust. 22
(4) Without approval or execution by the Board of Public Works, the Trust 23
may take title to a mortgaged property by foreclosure or by deed in lieu of foreclosure and: 24
(i) convey title to a buyer; and 25
(ii) obtain and seek enforcement of a deficiency judgment. 26
(5) An individual or business entity may receive a loan only if the recipient 27
can document that private financing is unavailable. 28
HOUSE BILL 674 5
(6) The Trust shall ensure that no loan is made under the MHT Loan 1
Program to acquire, restore, or rehabilitate a historic property unless the historic property 2
is listed in or eligible to be listed in the Historic Register. 3
(j) (1) The Trust shall require the recipient of a loan from the MHT Loan 4
Program to enter into an agreement to preserve and maintain the property. 5
(2) If the property is real property, the agreement shall be a recordable 6
historic preservation easement. 7
(3) The Secretary may waive the agreement requirement if the Secretary 8
finds that an agreement is impracticable. 9
(k) The trustees shall review and make recommendations to the Secretary about 10
loans and expenditures from the MHT Loan Fund, and the Secretary shall approve each 11
loan and expenditure from the MHT Loan Fund. 12
(l) (1) To the extent required by regulations adopted by the Secretary and 13
approved by the Board of Public Works, the Secretary shall submit to the Board of Public 14
Works for approval a proposed loan or expenditure from the MHT Loan Fund that will be 15
financed through the sale of State general obligation bonds. 16
(2) Except for an expenditure under subsection (d)(2) or (3) of this section, 17
a loan or expenditure from the MHT Loan Fund is not subject to Titles 4 and 5 of this 18
article. 19
(m) On or before December 31 of each year, the Trust shall report to the Governor 20
and, in accordance with § 2–1257 of the State Government Article, to the General Assembly 21
on the financial status and the activities of the MHT Loan Program for the preceding fiscal 22
year. 23
(n) (1) A person may not knowingly make or cause to be made a material false 24
statement of fact, including an understatement or overstatement of financial condition, in 25
a statement or report in or regarding an application for a loan or affecting an existing loan. 26
(2) A person who violates this subsection is guilty of a misdemeanor and 27
on conviction is subject to imprisonment not exceeding 2 years or a fine not exceeding 28
$5,000 or both.] 29
5A–327. 30
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 31
INDICATED. 32
(2) “PARTNERSHIP FUND” MEANS THE HISTORIC PRESERVATION 33
PARTNERSHIP FUND OF THE TRUST. 34 6 HOUSE BILL 674
(3) “PARTNERSHIP PROGRAM” MEANS THE HISTORIC 1
PRESERVATION PARTNERSHIP PROGRAM OF THE TRUST. 2
(4) “QUALIFIED COOPERATING NONPROFIT ORGANIZATI ON” MEANS 3
A NONPROFIT ORGANIZA TION IN GOOD STANDIN G WITH THE STATE DEPARTMENT 4
OF ASSESSMENTS AND TAXATION THAT: 5
(I) IS BASED IN THE STATE; 6
(II) OPERATES STATEWIDE; AND 7
(III) HAS DEMONSTRATED EXP ERIENCE: 8
1. REHABILITATING HISTO RIC STRUCTURES ; 9
2. MANAGING PRESERVATIO N FUNDS; AND 10
3. HOLDING PRESERVATION EASEMENTS. 11
(B) (1) THERE IS A PARTNERSHIP PROGRAM IN THE TRUST. 12
(2) THE PURPOSE OF THE PARTNERSHIP PROGRAM IS TO 13
IMPLEMENT AND ENCOUR AGE THE PRESERVATION OF HISTORIC PROPERTI ES BY 14
PARTNERING WITH A QU ALIFIED COOPERATING NONPROFIT ORGANIZATI ON THAT 15
WILL ADMINISTER FLEX IBLE FINANCIAL ASSIS TANCE FOR COMPLEX PR ESERVATION 16
PROJECTS AROUND T HE STATE. 17
(C) (1) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , THE 18
QUALIFIED COOPERATIN G NONPROFIT ORGANIZA TION MAY USE FUNDS P ROVIDED 19
BY THE TRUST: 20
(I) TO PAY FOR THE QUALI FIED COOPERATING NON PROFIT 21
ORGANIZATION TO ACQU IRE HISTORIC PROPERT IES OR INTERESTS IN HISTORIC 22
PROPERTIES FOR RESAL E OR LEASE; 23
(II) TO PAY COSTS , INCLUDING PREPARATIO N AND 24
ADMINISTRATIVE COSTS , TO RESTORE OR REHABI LITATE HISTORIC PROP ERTIES 25
OWNED BY THE QUALIFI ED COOPERATING NONPR OFIT ORGANIZATION FO R RESALE 26
OR LEASE; 27
HOUSE BILL 674 7
(III) TO MAKE LOANS TO OTH ER NONPROFIT ORGANIZ ATIONS, 1
POLITICAL SUBDIVISIO NS, AND BUSINESS ENTITIE S TO ACQUIRE, REHABILITATE , 2
RESTORE, OR REFINANCE HISTORI C PROPERTIES; 3
(IV) TO MAKE LOANS TO IND IVIDUALS TO REHABILI TATE OR 4
RESTORE HISTORIC PRO PERTIES RECOG NIZED BY THE NATIONAL PARK SERVICE AS 5
NATIONAL HISTORIC LANDMARKS; OR 6
(V) FOR NECESSARY ADMINI STRATIVE AND PROGRAM MATIC 7
EXPENSES ASSOCIATED WITH CARRYING OUT TH E GOALS OF THE PARTNERSHIP 8
PROGRAM. 9
(2) (I) THE TRUST SHALL DEVELOP A COMPETITIVE PROCESS FOR 10
MAKING AWARDS OF FIN ANCIAL ASSISTANCE UN DER THE PARTNERSHIP PROGRAM. 11
(II) THE QUALIFIED COOPERA TING NONPROFIT ORGAN IZATION 12
SHALL AWARD FINANCIA L ASSISTANCE UNDER T HE PARTNERSHIP PROGRAM IN A 13
MANNER CONSISTENT WI TH THE PROCESS DEVEL OPED BY THE TRUST IN 14
SUBPARAGRAPH (I) OF THIS PARAGRAPH . 15
(D) (1) THERE IS A PARTNERSHIP FUND. 16
(2) THE PURPOSE OF THE PARTNERSHIP FUND IS TO PROVIDE FU NDS 17
IN THE FORM OF A GRA NT OR COOPERATIVE AG REEMENT TO A QUALIFI ED 18
COOPERATING NONPROFI T ORGANIZATION TO AD MINISTER T HE PARTNERSHIP 19
PROGRAM. 20
(3) THE TRUST SHALL ADMINISTE R THE PARTNERSHIP FUND. 21
(4) (I) THE PARTNERSHIP FUND IS A SPECIAL, NONLAPSING FUND 22
THAT IS NOT SUBJECT TO § 7–302 OF THE STATE FINANCE AND PROCUREMENT 23
ARTICLE. 24
(II) THE STATE TREASURER SHALL HOLD THE FUND 25
SEPARATELY, AND THE COMPTROLLER SHALL ACC OUNT FOR THE FUND. 26
(5) THE PARTNERSHIP FUND CONSISTS OF : 27
(I) MONEY RECEIVED AS IN TEREST OR REPAYMENT OF 28
PRINCIPAL ON LOANS M ADE UNDER THE PARTNERSHIP PROGRAM OR THE CAPITAL 29
REVOLVING FUND FOR HISTORIC PRESERVATION ; 30
8 HOUSE BILL 674
(II) THE PROCEEDS FROM TH E RESALE OR LEASE OF PROPERTY 1
ORIGINALLY ACQUIRED BY THE QUALIFIED COO PERATING NONPROFIT 2
ORGANIZATION WITH MO NEY FROM THE PARTNERSHIP FUND OR THE CAPITAL 3
REVOLVING FUND FOR HISTORIC PRESERVATION ; 4
(III) MONEY RECEIVED FROM OTHER PUBLIC OR PRIV ATE 5
SOURCES FOR THE BENE FIT OF THE PARTNERSHIP FUND; AND 6
(IV) MONEY RECEIVED FROM THE SALE OF GENERAL 7
OBLIGATION BONDS . 8
(6) THE PARTNERSHIP FUND MAY BE USED FOR THE PURPOSE 9
IDENTIFIED IN PARAGR APH (2) OF THIS SUBSECTION. 10
(7) THE STATE TREASURER SHALL INVES T THE MONEY OF THE 11
PARTNERSHIP FUND IN THE SAME MANN ER AS OTHER STATE MONEY MAY BE 12
INVESTED. 13
(8) FOR FISCAL YEAR 2025 AND EACH FISCAL YEAR THEREAFTER , 14
THE GOVERNOR SHALL INCLUD E IN THE ANNUAL BUDG ET BILL AN APPROPRIATION 15
TO THE PARTNERSHIP PROGRAM TRANSFERRING THE AMOUNT OF 16
UNENCUMBERED AND UNA PPROPRIATED FUNDS IN THE PARTNERSHIP FUND TO 17
THE QUALIFIED COOPER ATING NONPROFIT ORGA NIZATION FOR THE PUR POSE 18
IDENTIFIED IN PARAGR APH (2) OF THIS SUBSECTION . 19
(E) (1) (I) ON OR BEFORE OCTOBER 1 EACH YEAR, THE TRUST SHALL 20
TRANSFER TO THE QUAL IFIED COOPERATING NO NPROFIT ORGANIZATION THE 21
FUNDS APPROPRIATED T O THE PARTNERSHIP PROGRAM FOR THE CURRE NT FISCAL 22
YEAR. 23
(II) TO THE EXTENT POSSIBL E, THE GOAL WILL BE TO 24
PRESERVE THE CORPUS OF TH E PARTNERSHIP FUND AS A REVOLVING F UND. 25
(2) (I) EXCEPT AS PROVIDED IN SUBPARAGRAPH (II) OF THIS 26
PARAGRAPH , THE QUALIFIED COOPER ATING NONPROFIT ORGA NIZATION SHALL 27
MAINTAIN A SEPARATE INTERNAL ACCOUNT FOR FUNDS PROVIDED FROM THE 28
PARTNERSHIP FUND. 29
(II) SUBJECT TO THE APPROV AL OF THE QUALIFIED 30
COOPERATING NONPROFI T ORGANIZATION ’S INVESTMENT POLICY BY THE BOARD 31
OF DIRECTORS OF THE QUALIFIED COOPERATIN G NONPROFIT ORGANIZA TION, 32
FUNDS MAY BE COMMING LED WITH OTHER FUNDS OF THE ORGANIZATION IF THE 33
FUNDS CAN BE ACCOUNTED FOR INDEPE NDENTLY OF OTHER FUN DS. 34 HOUSE BILL 674 9
(3) ON THE TRANSFER OF FU NDS TO THE PARTNERSHIP FUND, THE 1
USE OF FUNDS IS NO L ONGER SUBJECT TO § 5A–325 OF THIS SUBTITLE. 2
(F) THE QUALIFIED COOPERA TING NONPROFIT ORGAN IZATION SELECTED 3
TO ADMINISTER THE PARTNERSHIP PROGRAM, IN COORDINATION WITH THE 4
DIRECTOR, SHALL ADOPT APPROPRI ATE GUIDELINES TO CA RRY OUT THE 5
PURPOSES OF THE PARTNERSHIP PROGRAM. 6
(G) THE QUALIFIED COOPERA TING NONPROFIT ORGAN IZATION SHALL 7
MAKE THE FOLLOWING I NFORMATION AVAILABLE ON ITS WEBSITE: 8
(1) THE GUIDELINES ESTAB LISHED UNDER SUBSECT ION (F) OF THIS 9
SECTION; 10
(2) THE AVAILABILITY OF PARTNERSHIP PROGRAM FUNDS ; AND 11
(3) INFORMATION ON PROJE CTS RECEIVING FINANC IAL ASSISTANCE 12
FROM THE PARTNERSHIP FUND. 13
(H) (1) ON OR BEFORE JUNE 30 EACH YEAR, THE QUALIFIED 14
COOPERATING NONPROFI T ORGANIZATION SHALL PROVIDE AN ANNUAL RE PORT TO 15
THE TRUST OUTLINING THE U SE, ACCOUNTING , AND SUCCESS OF THE 16
PARTNERSHIP FUND. 17
(2) THE ANNUAL FINANCIAL REVIEW OR AUDIT OF T HE 18
ORGANIZATION SHALL B E PROVIDED AT THE REQUEST OF THE TRUST TO CONFIRM 19
THE INTENDED USE OF THE PARTNERSHIP FUND. 20
SECTION 2. AND BE IT FURTHER ENACTED, That, notwithstanding any other 21
provision of law, on or before July 31, 2023, the Governor shall transfer the funds 22
appropriated in fiscal year 2024 for the Historic Preservation Loan Program established 23
under § 5A–327 of the State Finance and Procurement Article to the Historic Preservation 24
Partnership Program established under § 5A–327 of the State Finance and Procurement 25
Article, as enacted by Section 1 of this Act. 26
SECTION 3. AND BE IT FURTHER ENACTED, That: 27
(a) After June 30, 2023, the State Treasurer shall credit any funds received for 28
the benefit of the Historic Preservation Loan Fund established under § 5A–327 of the State 29
Finance and Procurement Article to the Historic Preservation Partnership Fund 30
established under § 5A–327 of the State Finance and Procurement Article, as enacted by 31
Section 1 of this Act. 32
10 HOUSE BILL 674
(b) On or before July 31, 2023, all funds remaining in the Historic Preservation 1
Loan Fund established under § 5A–327 of the State Finance and Procurement Article shall 2
be transferred to the Historic Preservation Partnership Fund established under § 5A–327 3
of the State Finance and Procurement Article, as enacted by Section 1 of this Act, and shall 4
be used only in accordance with the provisions of § 5A–327 of the State Finance and 5
Procurement Article, as enacted by Section 1 of this Act. 6
(c) After July 31, 2023, the Historic Preservation Loan Fund established under § 7
5A–327 of the State Finance and Procurement Article shall be dissolved and no new 8
appropriations shall be made to the Historic Preservation Loan Fund. 9
SECTION 4. AND BE IT FURTHER ENACTED, That this Act shall take effect July 10
1, 2023. 11