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HB 561

Utilities, Utility Districts - As enacted, authorizes certain utility systems to borrow money in anticipation of revenue collections and to issue negotiable notes to evidence such borrowing to provide emergency cash flow for such systems, with oversight of such actions by the comptroller of the treasury; establishes deadline for the payment of such notes. - Amends TCA Section 7-34-111; Section 7-36-113; Section 7-82-501; Section 7-82-702; Section 68-221-1311 and Section 68-221-611.

114th Regular Session (2025-2026) Introduced by Kip Capley

Authorizes St. Mary's County to issue up to $71M in general obligation bonds to fund public facilities, repaid by property taxes, with up to 30-year maturities.

Comp. became Pub. Ch. 170
#utilities #utilitydistricts
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Bill Summary · HB 561

HB 561 — St. Mary’s County — Public Facilities Bond (Maryland)

Purpose / Intent

Authorize the County Commissioners of St. Mary’s County to borrow up to $71,000,000 through general obligation (GO) bonds to finance acquisition, construction, improvement, renovation and related costs for public buildings, facilities and public works projects in St. Mary’s County.

Key provisions

  • Authorizes St. Mary’s County to issue up to $71,000,000 in GO bonds (aggregate) to finance public facilities and related costs (land, design, engineering, legal, etc.).
  • Bonds may be issued in one or more series; the County determines details (form, denominations, interest rate(s) or method to determine rates, maturities, sale method and price) by County resolution.
  • Maximum maturity for any bond is 30 years from issue date.
  • County may issue refunding bonds to refinance outstanding debt.
  • County must levy ad valorem property taxes annually, at rates and in amounts sufficient to pay principal and interest on the bonds.
  • Bonds and interest are exempt from State, county, municipal and other Maryland taxation; however the County may choose to issue taxable bonds (i.e., interest not federally tax-exempt) if desired.
  • Proceeds may be used for a broad list of public facility categories (highways/bridges, public schools, law enforcement, health, libraries, parks & recreation, community college improvements, airport and marine facilities, refuse disposal, etc.).

Who is affected

  • Directly: St. Mary’s County government (capital projects and debt).
  • Indirectly: County taxpayers, who will fund debt service through property taxes; project beneficiaries (residents, county services, schools, public safety, recreation users).
  • State government: no direct fiscal impact from issuance; the bill is an authorization for a local borrowing (DLS reports “State Effect: None”).

Fiscal impact / numbers

  • County bond proceeds increase up to $71.0 million.
  • Department of Legislative Services (DLS) estimate: annual debt service ≈ $5.0 million over a 20‑year term, based on a 3.72% interest rate (actual cost will vary with interest rates, term, and structure).
  • St. Mary’s County outstanding debt (FY2023): ≈ $238.4 million (about 1.7% of the county’s assessable base; ~$2,077 per capita).
  • DLS notes the county’s planned capital projects total approximately $88.3 million — the $71M authorization would not fully fund the entire planned list.

Procedural / timing notes

  • Bill introduced and first read in the Maryland House (St. Mary’s County Delegation) on January 23, 2025 (filed as HB 561).
  • Assigned to the Appropriations Committee (and other local procedures). A public hearing was scheduled for March 12, 2025 (1:00 p.m.) per provided schedule.
  • Effective date in the version of the fiscal note: June 1, 2025.
  • Authorization is permissive: the County must still adopt resolutions and take steps to actually issue bonds; proceeds are only realized when bonds are sold.

Additional points

  • Because St. Mary’s County operates under the commission form of government, General Assembly authorization is required before the county may sell GO bonds; this bill provides that statutory authorization.
  • The legislation grants broad flexibility to the County in structuring financings (variable rates, private sale, bank/tender options, market enhancements, etc.), and allows for customary covenants needed to comply with federal tax rules and securities laws.

If you want, I can extract the specific projects and dollar amounts from the DLS project list (airport improvements, sheriff’s headquarters, school projects, parks and trails, etc.) and present them in a table.

Compiled from official sources — confirm details with the bill’s official record.

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