Texas 2009 - 81st Regular

Texas House Bill HB563 Compare Versions

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1	1	81R30143 JAM-F
2	2	By: Menendez H.B. No. 563
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the evaluation of applications for certain financial
8	8	assistance administered by the Texas Department of Housing and
9	9	Community Affairs.
10	10	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
11	11	SECTION 1. Section 2306.1114(a), Government Code, is
12	12	amended to read as follows:
13	13	(a) Not later than the 14th day after the date an
14	14	application or a proposed application for housing funds described
15	15	by Section 2306.111 has been filed, the department shall provide
16	16	written notice of the filing of the application or proposed
17	17	application to the following persons:
18	18	(1) the United States representative who represents
19	19	the community containing the development described in the
20	20	application;
21	21	(2) members of the legislature who represent the
22	22	community containing the development described in the application;
23	23	(3) the presiding officer of the governing body of the
24	24	political subdivision containing the development described in the
25	25	application;
26	26	(4) any member of the governing body of a political
27	27	subdivision who represents the area containing the development
28	28	described in the application;
29	29	(5) the superintendent and the presiding officer of
30	30	the board of trustees of the school district containing the
31	31	development described in the application; and
32	32	(6) any neighborhood organizations on record with the
33	33	state, municipality, or county in which the development described
34	34	in the application is to be located and whose boundaries contain the
35	35	proposed development site.
36	36	SECTION 2. Section 2306.6703, Government Code, is amended
37	37	to read as follows:
38	38	Sec. 2306.6703. INELIGIBILITY FOR CONSIDERATION. (a) An
39	39	application is ineligible for consideration under the low income
40	40	housing tax credit program if:
41	41	(1) at the time of application or at any time during
42	42	the two-year period preceding the date the application round
43	43	begins, the applicant or a related party is or has been:
44	44	(A) a member of the board; or
45	45	(B) the director, a deputy director, the director
46	46	of housing programs, the director of compliance, the director of
47	47	underwriting, or the low income housing tax credit program manager
48	48	employed by the department;
49	49	(2) the applicant proposes to replace in less than 15
50	50	years any private activity bond financing of the development
51	51	described by the application, unless:
52	52	(A) the applicant proposes to maintain for a
53	53	period of 30 years or more 100 percent of the development units
54	54	supported by housing tax credits as rent-restricted and exclusively
55	55	for occupancy by individuals and families earning not more than 50
56	56	percent of the area median income, adjusted for family size; [and]
57	57	(B) at least one-third of all the units in the
58	58	development are public housing units or Section 8 project-based
59	59	units; or
60	60	(C) the proceeds of the private activity bond
61	61	financing will only be redeemed in an amount consistent with their
62	62	proportionate amortization; or
63	63	(D) the proceeds of the private activity bond
64	64	financing will only be redeemed in an amount necessary to ensure the
65	65	financial feasibility of the proposal described by the application
66	66	and according to underwriting criteria established by the
67	67	department and provided that such redemption to the extent that it
68	68	reduces the bond amount to less than 50 percent of the cost of the
69	69	land plus depreciable basis in the first five years of operation is
70	70	allowed only if the Bond Review Board has determined that there
71	71	remain sufficient funds to fund all other mutlifamily applications
72	72	for such bonds that do not call for such a reduction;
73	73	(3) unless the applicant obtains approval of the
74	74	development from the governing body of the appropriate municipality
75	75	or county containing the development, the applicant proposes to
76	76	develop [construct] a new construction development that is located
77	77	one linear mile or less from a development that:
78	78	(A) serves the same type of household as the new
79	79	development[, regardless of whether the developments serve
80	80	families, elderly individuals, or another type of household];
81	81	(B) has received an allocation of housing tax
82	82	credits for new construction at any time during the three-year
83	83	period preceding the date the application round begins; and
84	84	(C) has not been withdrawn or terminated from the
85	85	low income housing tax credit program; or
86	86	(4) the development is located in a municipality or,
87	87	if located outside a municipality, a county that has more than twice
88	88	the state average of units per capita supported by housing tax
89	89	credits or private activity bonds, unless the applicant:
90	90	(A) obtains [has obtained prior] approval of the
91	91	development from the governing body of the appropriate municipality
92	92	or county containing the development; and
93	93	(B) provides, not later than the 30th day before
94	94	the date the board first meets to consider applications for an
95	95	allocation of housing tax credits, [has included in the
96	96	application] a written statement of support from that governing
97	97	body referencing this section and authorizing an allocation of
98	98	housing tax credits for the development.
99	99	(b) Subsections (a)(2), (3), and (4) do [Subsection (a)(3)
100	100	does] not apply to a development:
101	101	(1) that is using:
102	102	(A) federal HOPE VI funds or other similar funds
103	103	received through the United States Department of Housing and Urban
104	104	Development to assist in the preservation, through same-site
105	105	reconstruction or rehabilitation, of distressed federally assisted
106	106	housing;
107	107	(B) locally approved funds received from a public
108	108	improvement district or a tax increment financing district;
109	109	(C) funds provided to the state under the
110	110	Cranston-Gonzalez National Affordable Housing Act (42 U.S.C.
111	111	Section 12701 et seq.); or
112	112	(D) funds provided to the state and participating
113	113	jurisdictions under the Housing and Community Development Act of
114	114	1974 (42 U.S.C. Section 5301 et seq.); or
115	115	(2) that is located in a county with a population of
116	116	less than one million[;
117	117	[(3) that is located outside of a metropolitan
118	118	statistical area; or
119	119	[(4) that a local government where the project is to be
120	120	located has by vote specifically allowed the construction of a new
121	121	development located within one linear mile or less from a
122	122	development under Subsection (a)].
123	123	SECTION 3. Section 2306.6704(b-1), Government Code, is
124	124	amended to read as follows:
125	125	(b-1) The preapplication process must require the applicant
126	126	to provide the department with evidence that the applicant has
127	127	notified the following entities with respect to the filing of the
128	128	application:
129	129	(1) any neighborhood organizations on record with the
130	130	state, municipality, or county in which the development is to be
131	131	located and whose boundaries contain the proposed development site;
132	132	(2) the superintendent and the presiding officer of
133	133	the board of trustees of the school district containing the
134	134	development;
135	135	(3) the presiding officer of the governing body of any
136	136	municipality containing the development and all elected members of
137	137	that body;
138	138	(4) the presiding officer of the governing body of the
139	139	county containing the development and all elected members of that
140	140	body; and
141	141	(5) the state senator and state representative of the
142	142	district containing the development.
143	143	SECTION 4. Section 2306.6705, Government Code, is amended
144	144	to read as follows:
145	145	Sec. 2306.6705. GENERAL APPLICATION REQUIREMENTS. An
146	146	application must contain at a minimum the following written,
147	147	detailed information in a form prescribed by the board:
148	148	(1) a description of:
149	149	(A) the financing plan for the development,
150	150	including any nontraditional financing arrangements;
151	151	(B) the use of funds with respect to the
152	152	development;
153	153	(C) the funding sources for the development,
154	154	including:
155	155	(i) construction, permanent, and bridge
156	156	loans; and
157	157	(ii) rents, operating subsidies, and
158	158	replacement reserves; and
159	159	(D) the commitment status of the funding sources
160	160	for the development;
161	161	(2) if syndication costs are included in the eligible
162	162	basis, a justification of the syndication costs for each cost
163	163	category by an attorney or accountant specializing in tax matters;
164	164	(3) from a syndicator or a financial consultant of the
165	165	applicant, an estimate of the amount of equity dollars expected to
166	166	be raised for the development in conjunction with the amount of
167	167	housing tax credits requested for allocation to the applicant,
168	168	including:
169	169	(A) pay-in schedules; and
170	170	(B) syndicator consulting fees and other
171	171	syndication costs;
172	172	(4) if rental assistance, an operating subsidy, or an
173	173	annuity is proposed for the development, any related contract or
174	174	other agreement securing those funds and an identification of:
175	175	(A) the source and annual amount of the funds;
176	176	(B) the number of units receiving the funds; and
177	177	(C) the term and expiration date of the contract
178	178	or other agreement;
179	179	(5) if the development is located within the
180	180	boundaries of a political subdivision with a zoning ordinance,
181	181	evidence in the form of a letter from the chief executive officer of
182	182	the political subdivision or from another local official with
183	183	jurisdiction over zoning matters that states that:
184	184	(A) the development is permitted under the
185	185	provisions of the ordinance that apply to the location of the
186	186	development; or
187	187	(B) the applicant is in the process of seeking
188	188	the appropriate zoning and has signed and provided to the political
189	189	subdivision a release agreeing to hold the political subdivision
190	190	and all other parties harmless in the event that the appropriate
191	191	zoning is denied;
192	192	(6) if an occupied development is proposed for
193	193	rehabilitation:
194	194	(A) an explanation of the process used to notify
195	195	and consult with the tenants in preparing the application;
196	196	(B) a relocation plan outlining:
197	197	(i) relocation requirements; and
198	198	(ii) a budget with an identified funding
199	199	source; and
200	200	(C) if applicable, evidence that the relocation
201	201	plan has been submitted to the appropriate local agency;
202	202	(7) a certification of the applicant's compliance with
203	203	appropriate state and federal laws, as required by other state law
204	204	or by the board;
205	205	(8) any other information required by the board in the
206	206	qualified allocation plan; and
207	207	(9) evidence that the applicant has notified the
208	208	following entities with respect to the filing of the application:
209	209	(A) any neighborhood organizations on record
210	210	with the state, municipality, or county in which the development is
211	211	to be located and whose boundaries contain the proposed development
212	212	site;
213	213	(B) the superintendent and the presiding officer
214	214	of the board of trustees of the school district containing the
215	215	development;
216	216	(C) the presiding officer of the governing body
217	217	of any municipality containing the development and all elected
218	218	members of that body;
219	219	(D) the presiding officer of the governing body
220	220	of the county containing the development and all elected members of
221	221	that body; and
222	222	(E) the state senator and state representative of
223	223	the district containing the development.
224	224	SECTION 5. Section 2306.6710(b), Government Code, is
225	225	amended to read as follows:
226	226	(b) If an application satisfies the threshold criteria, the
227	227	department shall score and rank the application using a point
228	228	system that:
229	229	(1) prioritizes in descending order criteria
230	230	regarding:
231	231	(A) financial feasibility of the development
232	232	based on the supporting financial data required in the application
233	233	that will include a project underwriting pro forma from the
234	234	permanent or construction lender;
235	235	(B) quantifiable community participation with
236	236	respect to the development, evaluated on the basis of written
237	237	statements from any neighborhood organizations on record with the
238	238	state, municipality, or county in which the development is to be
239	239	located and whose boundaries contain the proposed development site;
240	240	(C) the income levels of tenants of the
241	241	development;
242	242	(D) the size and quality of the units;
243	243	(E) the commitment of development funding by
244	244	local political subdivisions;
245	245	(F) the level of community support for the
246	246	application, evaluated on the basis of written statements from the
247	247	state representative or the state senator that represents the
248	248	district containing the proposed development site;
249	249	(G) the rent levels of the units;
250	250	(H) the cost of the development by square foot;
251	251	(I) the services to be provided to tenants of the
252	252	development; and
253	253	(J) whether, at the time the complete application
254	254	is submitted or at any time within the two-year period preceding the
255	255	date of submission, the proposed development site is located in an
256	256	area declared to be a disaster under Section 418.014;
257	257	(2) uses criteria imposing penalties on applicants or
258	258	affiliates who have requested extensions of department deadlines
259	259	relating to developments supported by housing tax credit
260	260	allocations made in the application round preceding the current
261	261	round or a developer or principal of the applicant that has been
262	262	removed by the lender, equity provider, or limited partners for its
263	263	failure to perform its obligations under the loan documents or
264	264	limited partnership agreement; and
265	265	(3) encourages applicants to provide free notary
266	266	public service to the residents of the developments for which the
267	267	allocation of housing tax credits is requested.
268	268	SECTION 6. Section 2306.6711(f), Government Code, is
269	269	amended to read as follows:
270	270	(f) The board may allocate housing tax credits to
271	271	developments [more than one development] in a single community that
272	272	are or will be located one linear mile or less from each other, as
273	273	defined by department rule, in the same calendar year [only] if:
274	274	(1) the community is located in a county with a
275	275	population of one million or less;
276	276	(2) one or more of the allocations involves the
277	277	rehabilitation of existing developments and not more than one of
278	278	the allocations involves new construction; or
279	279	(3) the developments each serve a different type of
280	280	household from the other [the developments are or will be located
281	281	more than one linear mile apart]. [This subsection applies only to
282	282	communities contained within counties with populations exceeding
283	283	one million.]
284	284	SECTION 7. The changes in law made by this Act relating to
285	285	applications for financial assistance administered by the Texas
286	286	Department of Housing and Community Affairs apply only to an
287	287	application filed on or after the effective date of this Act. An
288	288	application filed before the effective date of this Act is governed
289	289	by the law in effect on the date the application was filed, and the
290	290	former law is continued in effect for that purpose.
291	291	SECTION 8. This Act takes effect September 1, 2009.