§ 31-112. Refunding bonds.

(a)

(1)

The Authority may issue bonds to refund any bonds of the Authority then outstanding, including the payment of any redemption premium and any interest accrued or to accrue to the earliest or any subsequent date of redemption, purchase or maturity of the bonds. Refunding bonds may be issued for the public purposes of realizing savings in the effective costs of debt service, directly or through a debt restructuring, for alleviating impending or actual default and may be issued in one or more series in an amount in excess of that of the bonds to be refunded.

(2)

The proceeds of any bonds issued for the purpose of refunding outstanding bonds my be applied to the purchase or retirement at maturity or redemption of outstanding bonds either on their earliest or any subsequent redemption date or upon the purchase or at the maturity thereof and may, pending application, be placed in escrow to be applied to the purchase or retirement at maturity or redemption on a date determined by the Authority.

(b)

(1)

Any escrowed proceeds, pending use, may be invested and reinvested in direct obligations of the United States of America or in any other obligations permitted by the bond resolution pursuant to which the refunded bonds were issued, maturing at a time or times appropriate to assure the prompt payment of the principal of and interest and redemption premium, if any, on the outstanding bonds to be refunded.

(2)

The interest, income, and profits, if any, earned or realized on any investment may also be applied to the payment of the outstanding bonds to be refunded.

(3)

After the terms of the escrow have been fully satisfied and carried out, any balance of proceeds and interest, income, and profits, if any, earned or realized on the investments shall be returned to the Authority for disposition as provided in the bond resolution pursuant to which the refunded bonds were issued or otherwise in accordance with law.

(c)

Refunding bonds shall be subject to this Subtitle in the same manner and to the same extent as other bonds issued under this Subtitle.

(Chapter 704, Laws of Md., 1986)