EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
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SENATE BILL 24
B1, R2 3lr0696
(PRE–FILED) CF HB 51
By: Senator McCray Senators McCray, Bailey, Benson, Corderman, Elfreth,
Guzzone, Hettleman, Jackson, Jennings, King, Rosapepe, Salling, and
Zucker
Requested: November 4, 2022
Introduced and read first time: January 11, 2023
Assigned to: Budget and Taxation
Committee Report: Favorable with amendments
Senate action: Adopted
Read second time: March 11, 2023
CHAPTER ______
AN ACT concerning 1
Department of Transportation – Consolidated Transportation Program and 2
Debt Limit of Grant Anticipation Revenue Vehicle Bonds Financing and 3
Commission on Transportation Revenue and Infrastructure Needs 4
(State and Federal Transportation Funding Act) 5
FOR the purpose of requiring the financial forecast that supports the Consolidated 6
Transportation Program to include a reserve of a certain amount for changes in 7
certain revenue sources; repealing a requirement that the Capital Debt Affordability 8
Committee include certain debt that is secured by future federal aid within its review 9
of State tax supported debt; altering the calculation of the maximum amount of debt 10
secured by future federal aid that the Department of Transportation may issue; 11
providing that the maximum amount of debt that may be issued is calculated as of a 12
certain date; providing that the proceeds from the issuance of certain debt may be 13
used only for certain purposes; altering the maximum term of certain bonds that are 14
secured by a pledge of future federal aid; repealing the pledge of certain taxes to the 15
payment of certain bonds secured by a pledge of federal aid; establishing the 16
Maryland Commission on Transportation Revenue and Infrastructure Needs; and 17
generally relating to the Consolidated Transportation Program’s financial forecast 18
and the amount of debt that the Department of Transportation may issue debt issued 19
by the Department of Transportation that is secured by future federal aid and 20
transportation revenue and infrastructure needs. 21
2 SENATE BILL 24
BY repealing and reenacting, without amendments, 1
Article – Transportation 2
Section 2–103.1(b) 3
Annotated Code of Maryland 4
(2020 Replacement Volume and 2022 Supplement) 5
BY repealing and reenacting, with amendments, 6
Article – Transportation 7
Section 2–103.1(m) 8
Annotated Code of Maryland 9
(2020 Replacement Volume and 2022 Supplement) 10
BY repealing and reenacting, with amendments, 11
Article – State Finance and Procurement 12
Section 8–104 13
Annotated Code of Maryland 14
(2021 Replacement Volume and 2022 Supplement) 15
BY repealing and reenacting, with amendments, 16
Article – Transportation 17
Section 3–601 18
Annotated Code of Maryland 19
(2020 Replacement Volume and 2022 Supplement) 20
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEM BLY OF MARYLAND, 21
That the Laws of Maryland read as follows: 22
Article – State Finance and Procurement 23
8–104. 24
(a) In this Part II of this subtitle the following words have the meanings 25
indicated. 26
(b) “Committee” means the Capital Debt Affordability Committee. 27
(c) (1) “Tax supported debt” means: 28
(i) State debt; and 29
(ii) other forms of debt, including State agency capital leases 30
supported in whole or part by State tax revenues and debt of the Department of 31
Transportation, the Maryland Stadium Authority, and other units of State government 32
which, in the opinion of the Committee, are supported directly or indirectly by State tax 33
revenues. 34
SENATE BILL 24 3
(2) [“Tax supported debt” includes debt issued by the Department of 1
Transportation under Title 3, Subtitle 6 of the Transportation Article or by the Maryland 2
Transportation Authority under Title 4, Subtitle 3 of the Transportation Article that is 3
secured by a pledge of future federal aid from any source. 4
(3)] “Tax supported debt” does not include capital leases used to finance 5
energy performance contracts entered into under § 12–301 of this article, if, as determined 6
by the Committee, energy savings that are guaranteed by the contractor: 7
(i) equal or exceed the capital lease payments on an annual basis; 8
and 9
(ii) are monitored in accordance with reporting requirements 10
adopted by the Committee. 11
Article – Transportation 12
2–103.1. 13
(b) The State Report on Transportation co nsists of the Consolidated 14
Transportation Program and the Maryland Transportation Plan. 15
(m) (1) (i) Subject to § 2–1257 of the State Government Article: 16
1. On or before September 1 of each year, the Department 17
shall submit copies of the proposed Consolidated Transportation Program and the 18
supporting financial forecast to the General Assembly; and 19
2. On submission of the budget bill to the presiding officers 20
of the General Assembly, the Department shall submit copies of the approved Consolidated 21
Transportation Program, including the manner in which each major transportation project 22
was evaluated and ranked under § 2–103.7 of this subtitle, and the supporting financial 23
forecast to the General Assembly. 24
(ii) Notwithstanding § 2–1257(b)(2) of the State Government Article, 25
the Department shall provide to each member of the General Assembly a copy of the 26
proposed Consolidated Transportation Program and the approved Consolidated 27
Transportation Program. 28
(2) (i) The financial forecast supporting the Consolidated 29
Transportation Program to be submitted to the General Assembly under paragraph (1) of 30
this subsection shall include the following components: 31
1. A schedule of operating expenses for each specific modal 32
administration; 33
4 SENATE BILL 24
2. A schedule of revenues, including tax and fee revenues, 1
deductions from revenues for other agencies, Department program and fees, Motor Vehicle 2
Administration cost recovery, deductions for highway user revenues, operating revenues 3
by modal administration, and miscellaneous revenues; and 4
3. A summary schedule for the Transportation Trust Fund 5
that includes the opening and closing Fund balance, revenues, transfers, bond sales, bond 6
premiums, any other revenues, expenditures for debt service, operating expenses, amounts 7
available for capital expenses, bond interest rates, bond coverage ratios, total bonds 8
outstanding, federal capital aid, and the total amount for the Transportation Capital 9
Program. 10
(ii) The financial forecast shall include[, for]: 11
1. FOR each of the components specified in subparagraph (i) 12
of this paragraph: 13
[1.] A. Actual information for the last full fiscal year; and 14
[2.] B. Forecasts of the information for each of the six 15
subsequent fiscal years, including the current fiscal year, the fiscal year for the proposed 16
budget, and the next four subsequent fiscal years; AND 17
2. FOR THE SUMMARY OF RE VENUES AND RECEIPTS 18
COMPONENT , A LINE ITEM OF $30,000,000 FOR A RESERVE FOR CH ANGES IN 19
REVENUE SOURCES FOR EACH FISCAL YEAR INC LUDED IN THE FINANCIAL 20
FORECAST. 21
(iii) 1. For the period beyond the budget request year, the 22
financial forecast: 23
A. Shall maximize the use of funds for the capital program; 24
B. Except as authorized by law, may not withhold or reserve 25
funds for capital transportation grants to counties or municipal corporations; and 26
C. Except as provided in subsubparagraph 2 of this 27
subparagraph, shall increase the operating expenses, net of availability payments paid to 28
public–private partnership concessionaires, each year by at least the 5–year average 29
annual rate of change in the operating expenses of the Department, ending with the most 30
recently completed fiscal year. 31
2. The assumed rate of future operating budget growth 32
under subsubparagraph 1C of this subparagraph may not increase or decrease by more 33
than 0.5 percentage points from the growth rate assumed in the previous forecast. 34
SENATE BILL 24 5
(iv) The Department shall incorporate in the financial forecast the 1
most recent estimates by the Board of Revenue Estimates of the revenues from: 2
1. The corporate income tax and the sales and use tax for 3
each of the six subsequent years, including the current fiscal year and the fiscal year for 4
the proposed budget; and 5
2. Motor fuel taxes and motor vehicle titling taxes for the 6
current fiscal year and the fiscal year for the proposed budget. 7
3–601. 8
(a) In order to utilize to the greatest extent possible the benefits of available 9
financial resources relating to transportation purposes, including federal grants, loans, 10
transportation facility revenue sources, and other programs, the Department from time to 11
time may issue its bonds and otherwise borrow funds, as provided in this subtitle, to finance 12
the costs of transportation facilities. 13
(b) The Department may apply for any financial assistance in support of projects 14
deemed appropriate by the Secretary. 15
(c) The Department may undertake the following actions and do all things 16
necessary and appropriate consistent with such actions to utilize the available resources 17
specified in subsection (a) of this section: 18
(1) Pledge and use existing and anticipated federal funds paid to or 19
expected to be paid to the Department for transportation purposes for the payment of the 20
principal of and interest on the Department’s bonds or other debt obligations issued under 21
this subtitle to finance the costs of transportation facilities; and 22
(2) (i) Borrow funds from the federal government or its agencies, and 23
evidence such borrowing with a promissory note or other evidence of obligation; 24
(ii) Borrow funds from a nongovernment lender if the loan is 25
guaranteed by the federal government or its agencies; and 26
(iii) 1. Use the proceeds of the loans described in items (i) and (ii) 27
of this paragraph in connection with transportation facilities including use of the proceeds 28
to pay the costs of financing transportation facilities and the payment of debt service on the 29
Department’s bonds issued in connection with such transportation facilities; 30
2. Repay the loans with revenues attributable to the 31
transportation facilities being financed; and 32
3. Pledge revenues attributable to the transportation 33
facilities being financed in order to secure the Department’s obligations to the federal 34
government or its agencies or a nongovernment lender in connection with the loans. 35 6 SENATE BILL 24
(d) If the Department intends to pledge any future federal aid from any source to 1
support repayment of bonds issued under this subtitle: 2
(1) The aggregate OUTSTANDING AND UNPA ID principal amount of debt 3
issued under this subtitle or Title 4, Subtitle 3 of this article that is secured by a pledge of 4
future federal aid may not exceed $750,000,000 $1,000,000,000 AS OF JUNE 30 OF ANY 5
FISCAL YEAR, PROVIDED THAT THE PR OCEEDS MAY BE USED O NLY FOR: 6
(I) DESIGNING AND CONSTRU CTING THE BALTIMORE RED 7
LINE; 8
(II) PROCURING ELECTRIC BUSES AND C ONSTRUCTING 9
RELATED INFRASTRUCTU RE ZERO–EMISSION BUSES CONSI STENT WITH § 7–406 OF 10
THE TRANSPORTATION ARTICLE AND CONSTRUCT ING RELATED INFRASTR UCTURE, 11
INCLUDING BUS MA INTENANCE FACILITIES ; 12
(III) REHABILITATING OR REP LACING THE SUSQUEHANNA 13
RIVER RAIL BRIDGE; 14
(IV) REPLACING THE BALTIMORE AND POTOMAC TUNNEL WITH 15
THE FREDERICK DOUGLASS TUNNEL; 16
(V) DEVELOPING AND CONSTR UCTING THE SOUTHERN 17
MARYLAND RAPID TRANSIT CORRIDOR; OR 18
(VI) (IV) IMPROVING CAPACITY OR RUN–THROUGH SERVICE 19
ON THE BRUNSWICK, CAMDEN, OR PENN LINES OF THE MARYLAND AREA 20
REGIONAL COMMUTER (MARC) RAIL SYSTEM; DESIGNING AND CONSTRU CTING 21
IMPROVEMENTS TO THE MARYLAND ROUTE 2 AND ROUTE 4 CORRIDOR, INCLUDING 22
THE THOMAS JOHNSON BRIDGE; 23
(V) DESIGNING AND CONSTRU CTING IMPROVEMENTS T O THE 24
MARYLAND ROUTE 90 CORRIDOR; OR 25
(VI) DESIGNING AND CONSTRU CTING IMPROVEMENTS T O THE 26
INTERSTATE 81 CORRIDOR; 27
(2) The date of maturity may not be later than 12 15 years after the date 28
of issue; AND 29
(3) Notwithstanding § 3–215(d) of this title, if future federal aid is 30
insufficient to pay the principal of and interest on the bonds issued under this subtitle when 31
due, the tax levied under § 3–215 of this title, to the extent the proceeds of such tax are not 32
necessary to provide the sinking fund required under § 3–215(c) of this title, is irrevocably 33 SENATE BILL 24 7
pledged to the payment of the principal of and interest on the bonds issued under this 1
subtitle as they become due and payable; 2
(4) The lien of the pledge under item (3) of this subsection shall at all times 3
be subordinate to the lien of the pledge of such tax under § 3–215(d) of this title to the 4
payment of principal of and interest on consolidated transportation bonds; and 5
(5) (3) No part of the tax levied under § 3–215 of this title may be 6
repealed, diminished, or applied to any other purpose until: 7
(i) The bonds issued under this subtitle and interest on them have 8
become due and fully paid; or 9
(ii) Adequate and complete provision for payment of the principal 10
and interest has been made. 11
(e) (1) By resolution of the Secretary, the Department may: 12
(i) Borrow funds to finance the costs of transportation facilities; 13
(ii) Evidence the borrowing by the issuance and sale of 14
revenue–backed bonds; and 15
(iii) Pledge and use a dedicated revenue source, which may include 16
revenues attributable to the transportation facilities being financed, for the payment of the 17
principal of and interest on the Department’s revenue–backed bonds described in this 18
subsection. 19
(2) Payment of the principal of or interest on revenue–backed bonds issued 20
under this subtitle may not be supported directly or indirectly by State tax revenues 21
pledged to meet debt service on Consolidated Transportation Bonds as prescribed under § 22
3–215 of this title. 23
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 24
1, 2023. 25
SECTION 2. AND BE IT FURTHER ENACTED, That: 26
(a) There is a Maryland Commission on Transportation Revenue and 27
Infrastructure Needs. 28
(b) The Commission consists of: 29
(1) three members of the Senate of Maryland, appointed by the President 30
of the Senate; 31
8 SENATE BILL 24
(2) three members of the House of Delegates, appointed by the Speaker of 1
the House; and 2
(3) the following members appointed by the Governor: 3
(i) the Secretary of Transportation; 4
(ii) the Secretary of Budget and Management; 5
(iii) the Secretary of Commerce; 6
(iv) the Secretary of Planning; 7
(v) a representative of the Washington Metropolitan Transit 8
Authority; 9
(vi) two modal administrators from the Department of 10
Transportation, selected by the Secretary of Transportation; 11
(vii) three representatives from the business community, including 12
two representatives of statewide or regional organizations; 13
(viii) two representatives of the transit community; 14
(ix) two representatives of the environmental community; 15
(x) a representative of the American Automobile Association; 16
(xi) a representative of the freight rail industry; 17
(xii) a representative of the motor carrier industry; 18
(xiii) a representative of the Maryland Association of Counties; 19
(xiv) a representative of the transportation construction industry; 20
(xv) a representative of the Maryland Municipal League; 21
(xvi) a representative of the cycling advocacy community; 22
(xvii) two representatives of labor unions; and 23
(xviii) two individuals representing rural areas in the State. 24
(c) The Governor shall designate the chair of the Commission after consultation 25
with the President of the Senate and the Speaker of the House. 26
SENATE BILL 24 9
(d) To the extent practicable, the President of the Senate, the Speaker of the 1
House, and the Governor shall attempt to ensure regional, economic, ethnic, and gender 2
diversity on the Commission. 3
(e) A member of the Commission: 4
(1) may not receive compensation as a member of the Commission; but 5
(2) is entitled to reimbursement of expenses under the Standard State 6
Travel Regulations, as provided in the State budget. 7
(f) The Department of Transportation and the Department of Legislative 8
Services shall provide staff support to the Commission. 9
(g) The Commission shall review, evaluate, and make recommendations 10
concerning: 11
(1) the current State funding sources and structure of the Maryland 12
Transportation Trust Fund, including: 13
(i) revenue trends that demonstrate weaknesses in the stability of 14
the Trust Fund; and 15
(ii) trends in operating and capital expenditures, and how existing 16
resources have constrained programming; 17
(2) the methods that other states are employing to fund state 18
transportation operating and capital programs; 19
(3) short– and long–term construction and maintenance funding needs for 20
transit, highway, pedestrian, bicycle, heavy rail, shipping, air travel, and other 21
transportation needs; 22
(4) options for public–private partnerships, including partnerships with 23
local governments, to meet transportation funding needs; 24
(5) changes in transportation technology and trends that will impact 25
transportation infrastructure needs and costs to the State; 26
(6) existing practices for prioritizing project funding and options to better 27
prioritize needs, including local and legislative priorities; 28
(7) the structure of regional transportation authorities and the ability of 29
these authorities to meet transportation needs in various regions of the State; and 30
(8) options for sustainable, long–term revenue sources for transportation. 31
10 SENATE BILL 24
(h) On or before January 1, 2024, the Commission shall submit an interim report 1
of its findings and recommendations to the Governor and, in accordance with § 2–1257 of 2
the State Government Article, the General Assembly. 3
(i) On or before January 1, 2025, the Commission shall submit a final report of 4
its findings and recommendations to the Governor and, in accordance with § 2–1257 of the 5
State Government Article, the General Assembly. 6
SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take effect July 7
1, 2023. Section 2 of this Act shall remain effective for a period of 2 years and, at the end of 8
June 30, 2025, Section 2 of this Act, with no further action required by the General 9
Assembly, shall be abrogated and of no further force and effect. 10
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
President of the Senate.
________________________________________________________________________________
Speaker of the House of Delegates.