Bill Text: TX HB2027 | 2021-2022 | 87th Legislature | Comm Sub

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Relating to the allocation of low income housing tax credits.

Spectrum: Partisan Bill (Democrat 5-0)

Status: (Engrossed - Dead) 2021-05-25 - Placed on intent calendar [HB2027 Detail]

Download: Texas-2021-HB2027-Comm_Sub.html

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87R18253 JAM-D
By: Cortez H.B. No. 2027
Substitute the following for H.B. No. 2027:
By: J. Johnson of Harris C.S.H.B. No. 2027

A BILL TO BE ENTITLED
AN ACT
relating to the allocation of low income housing tax credits.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The heading to Section 2306.67071, Government
Code, is amended to read as follows:
Sec. 2306.67071. ADDITIONAL APPLICATION REQUIREMENT:
NOTICE [, HEARING,] AND CERTIFICATION [RESOLUTION] BY CERTAIN
GOVERNING BODIES.
SECTION 2. Section 2306.67071, Government Code, is amended
by amending Subsections (c) and (d) and adding Subsection (c-1) to
read as follows:
(c) Except as provided by Subsection (c-1), the [The] board
may not approve an application for housing tax credits for
developments financed through the private activity bond program
unless each applicable governing body described by Subsection (a)
[the applicant] has submitted to the department a certification
stating [certified copy of a resolution from each applicable
governing body described by Subsection (a). The resolution must
certify] that:
(1) notice has been provided to the [each] governing
body as required by Subsection (a); and
(2) the [each] governing body has had sufficient
opportunity to obtain a response from the applicant regarding any
questions or concerns about the proposed development[;
[(3) each governing body has held a hearing under
Subsection (b); and
[(4) after due consideration of the information
provided by the applicant and public comment, the governing body
does not object to the proposed application].
(c-1) The board may approve an application for housing tax
credits without receiving each certification required by
Subsection (c) if after the 60th day following the date on which all
applicable governing bodies have received notice under Subsection
(a) the applicant submits to the department a certification stating
that the applicant has substantially complied with the requirements
of Subsection (c)(2).
(d) The department by rule may provide for additional
requirements relating to the time and manner of the submission to
the department of a certification [resolution] required by
Subsection (c) or (c-1).
SECTION 3. Section 2306.6710(b), Government Code, is
amended to read as follows:
(b) If an application satisfies the threshold criteria, the
department shall score and rank the application using a point
system that:
(1) considers [prioritizes in descending order]
criteria regarding:
(A) financial feasibility of the development
based on the supporting financial data required in the application
that will include a project underwriting pro forma from the
permanent or construction lender;
(B) quantifiable community participation with
respect to the development, evaluated on the basis of a resolution
concerning the development that is voted on and adopted by the
following, as applicable:
(i) the governing body of a municipality in
which the proposed development site is to be located;
(ii) subject to Subparagraph (iii), the
commissioners court of a county in which the proposed development
site is to be located, if the proposed site is to be located in an
area of a county that is not part of a municipality; or
(iii) the commissioners court of a county
in which the proposed development site is to be located and the
governing body of the applicable municipality, if the proposed site
is to be located in the extraterritorial jurisdiction of a
municipality;
(C) the income levels of tenants of the
development;
(D) the size and quality of the units;
(E) the rent levels of the units;
(F) the cost of the development by square foot;
(G) the services to be provided to tenants of the
development;
(H) whether, at the time the complete application
is submitted or at any time within the two-year period preceding the
date of submission, the proposed development site is located in an
area declared to be a disaster under Section 418.014;
(I) quantifiable community participation with
respect to the development, evaluated on the basis of written
statements from any neighborhood organizations on record with the
state or county in which the development is to be located and whose
boundaries contain the proposed development site; and
(J) the level of community support for the
application, evaluated on the basis of a written statement from the
state representative who represents the district containing the
proposed development site;
(2) uses criteria imposing penalties on applicants or
affiliates who have requested extensions of department deadlines
relating to developments supported by housing tax credit
allocations made in the application round preceding the current
round or a developer or principal of the applicant that has been
removed by the lender, equity provider, or limited partners for its
failure to perform its obligations under the loan documents or
limited partnership agreement; and
(3) encourages applicants to provide free notary
public service to the residents of the developments for which the
allocation of housing tax credits is requested.
SECTION 4. Section 2306.6725(b), Government Code, is
amended to read as follows:
(b) The department shall provide appropriate incentives as
determined through the qualified allocation plan to reward
applicants who agree to:
(1) equip the development that is the basis of the
application with energy saving devices that meet the standards
established by the state energy conservation office; or
(2) provide to a qualified entity, in a land use
restriction agreement in accordance with Section 2306.6726, a right
of first refusal to purchase the development at the minimum price
provided in, and in accordance with the requirements of, Section
42(i)(7), Internal Revenue Code of 1986 (26 U.S.C. Section
42(i)(7))[; and
[(2) locate the development in a census tract in which
there are no other existing developments supported by housing tax
credits].
SECTION 5. Section 2306.67071(b), Government Code, is
repealed.
SECTION 6. The change in law made by this Act applies only
to an application for low income housing tax credits that is
submitted to the Texas Department of Housing and Community Affairs
during an application cycle that is based on the 2022 qualified
allocation plan or a subsequent plan adopted by the governing board
of the department. An application that is submitted during an
application cycle that is based on an earlier qualified allocation
plan is governed by the law in effect on the date the application
cycle began, and the former law is continued in effect for that
purpose.
SECTION 7. This Act takes effect September 1, 2021.