2023 District of Columbia Code › Title 47 - Taxation, Licensing, Permits, Assessments, and Fees. [Enacted title] › Chapter 3 - Budget and Financial Management; Borrowing; Deposit of Funds › Subchapter II-D - Income Tax Secured Bonds › § 47–340.27. Creation of the Income Tax Secured Bond Fund

§ 47–340.27. Creation of the Income Tax Secured Bond Fund.
(a) There is established separate and apart from the General Fund of the District of Columbia as a nonlapsing fund the Income Tax Secured Bond Fund.
(b) The Chief Financial Officer may direct every taxpayer that is required to pay either the Business Franchise Tax or the Income Tax, or both, every employer that pays withholding taxes for employees, and every taxpayer that is required to pay estimated taxes, to send the payments directly to the Collection Agent for collection and disbursement in accordance with the collection instructions of the Chief Financial Officer. Tax payments or collections received pursuant to enforcement actions, received from bankruptcy trustees or through the Bankruptcy Courts, received as a result of garnished wages, received as collections of tax levies, including the release of liens at real estate closings, received as a result of closures of estates, received as a result of the sales of businesses or involving business licenses, and other collection activities shall be collected by the Chief Financial Officer and forwarded to the Collection Agent or deposited in the Income Tax Secured Bond Fund upon reconciliation of accounts.
(c) The Collection Agent may collect, receive, hold, and invest Available Tax Revenues, and shall promptly deposit all receipts into the Income Tax Secured Bond Fund, along with any other taxes or fees specifically designated by law for deposit in the Income Tax Secured Bond Fund.
(d) The Mayor, through the Chief Financial Officer, shall pledge, assign, and create a security interest in the Available Tax Revenues and all other funds in the Income Tax Secured Bond Fund, or any sub-account within the Income Tax Secured Bond Fund, for the payment of the costs of carrying out any of the purposes described in subsection (g) of this section without further action by the Council as permitted by § 1-204.90. If bonds are issued, the payment shall be made in accordance with the provisions of the Financing Documents entered into by the District in connection with the issuance of the bonds. If the District pays or makes provision to pay, pursuant to the terms of the Financing Documents, to the owners of bonds the principal or redemption price, and the interest due or to become due, at the time and in the manner stipulated, such that the bonds are no longer considered outstanding within the meaning of the Financing Documents, the security interest in the Available Tax Revenues shall be terminated with respect to the defeased bonds.
(e) Although payment of debt service on the bonds does not require an appropriation for that purpose pursuant to § 1-204.90, the Council may, in establishing the annual budget of the District, include in each annual budget for a fiscal year of the District sufficient funds to pay the principal of, and interest on, the bonds becoming due and payable for any reason during that fiscal year.
(f) When deposited in the Income Tax Secured Bond Fund, the funds in the Fund and all investments or earnings on these funds shall be irrevocably dedicated and pledged to the payment of the principal of, and interest on, the bonds and costs as provided in subsection (g) of this section. Any escrow or other agreement entered into by the Chief Financial Officer providing for holding funds for the benefit of the holders of the bonds shall be maintained so long as any of the bonds are outstanding under the Financing Documents.
(g) The funds deposited in the Income Tax Secured Bond Fund may be used to pay:
(1) The costs of the Collection Agent and the trustee; and
(2) Debt service on the bonds and such other applications as may be set forth in the Financing Documents.
(h) If, at the end of any period determined in the Financing Documents, the balance of cash and investments in the Income Tax Secured Bond Fund exceeds the amount required to be held in the Income Tax Secured Bond Fund pursuant to the Financing Documents, the excess shall be transferred to the unrestricted fund balance of the General Fund of the District of Columbia in accordance with the Financing Documents.
(Oct. 22, 2008, D.C. Law 17-254, § 2(b), 55 DCR 9275.)
Section References
This section is referenced in § 47-340.26.