(a) (1) For the purpose of paying the principal of and interest on consolidated
transportation bonds as they become due and payable, there is hereby
levied and imposed an annual tax that consists of the taxes specified
in this section and, to the extent necessary and except as otherwise
provided in this subsection, that shall be used and applied exclusively
for that purpose.
(2) The required use and application of the tax under paragraph (1) of this
subsection is subject only to the prior use and application of one or
all or any combination of the taxes specified in this section to meet
the debt service on all of the following bonds while they are
outstanding and unpaid and to the payment of which any part of those
taxes has been pledged:
(i) Bonds of prior issues;
(ii) Bonds of any series of county highway construction bonds or county
transportation bonds issued under § 211 or § 211G-1 of Article 89B
of the Code of 1957; and
(iii) Bonds of any series of county transportation bonds issued under
Subtitle 3 of this title.
(b) The tax levied and imposed by this section consists of that part of the
following taxes that are retained to the credit of the Department after
distributions to the political subdivisions:
(1) The motor fuel tax revenue distributed under §§ 2-1103(2) and
2-1104(4) of the Tax - General Article;
(2) The income tax revenue distributed under § 2-614 of the Tax -
General Article;
(3) The excise tax imposed on vehicles by Part II of Title 13, Subtitle 8
of this article; and
(4) The sales and use tax revenues distributed under § 2-1302.1 of the
Tax - General Article.
(c) As long as any consolidated transportation bonds are outstanding and
unpaid, and except as provided in § 3-104 of this title, there shall
be deposited and maintained in a sinking fund to be maintained by the
State Treasurer to secure the payment of the principal of and interest
on the bonds, annually or more often, as received, so much of the
proceeds of the tax levied and imposed under this section, together
with all other funds received by the Department and credited to the
Transportation Trust Fund, as are necessary to maintain in the sinking
fund a sum equal to the amount required to pay the principal of and
interest on the outstanding and unpaid bonds that will become due and
payable in the current calendar year and the next succeeding calendar
year.
(d) The tax levied and imposed by this section is irrevocably pledged to
the payment of the principal of and interest on consolidated
transportation bonds as they become due and payable, and no part of the
tax or other funds applicable to debt service on the bonds may be
repealed, diminished, or applied to any other purpose until:
(1) The bonds and the interest on them have become due and fully paid; or
(2) Adequate and complete provision for payment of the principal and
interest has been made.
(e) (1) In this subsection "government obligations" means direct
obligations of, or obligations the principal of and interest on which
are unconditionally guaranteed by the United States of America.
(2) Adequate and complete provision for payment of the principal and
interest of any issue or series of consolidated transportation bonds
may be made by the Secretary and the State Treasurer by making a
transfer of government obligations from the Transportation Trust Fund
to the State Treasurer or to a bank or trust company as escrow fund
agent in an amount which, together with the income due thereon, will be
sufficient to pay in full when due the maturing principal of and
interest on the consolidated transportation bonds.
(3) To the extent that adequate and complete provision has been made for
the payment of consolidated transportation bonds under this title those
bonds shall no longer be deemed to be outstanding and unpaid under this
title.
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