Texas 2009 - 81st Regular

Texas Senate Bill SB1205 Compare Versions

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1	1	By: West S.B. No. 1205
2	2
3	3
4	4	A BILL TO BE ENTITLED
5	5	AN ACT
6	6	relating to community land trusts.
7	7	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
8	8	SECTION 1. Subtitle A, Title 12, Local Government Code, is
9	9	amended by adding Chapter 373B to read as follows:
10	10	CHAPTER 373B. COMMUNITY LAND TRUSTS
11	11	Sec. 373B.001. DEFINITION. In this chapter, "community
12	12	housing development organization" has the meaning assigned by 42
13	13	U.S.C. Section 12704.
14	14	Sec. 373B.002. CREATION OR DESIGNATION. The governing body
15	15	of a municipality or county by ordinance or order may create or
16	16	designate one or more community land trusts, including a housing
17	17	finance corporation established under Chapter 394 or a land trust
18	18	operated by a community housing development organization certified
19	19	by the municipality or county, to operate in the municipality or
20	20	county.
21	21	Sec. 373B.003. NATURE OF TRUST. A community land trust
22	22	created or designated under Section 373B.002 must be a nonprofit
23	23	organization that is:
24	24	(1) created to acquire and hold land for the benefit of
25	25	developing and preserving long-term affordable housing in the
26	26	municipality or county; and
27	27	(2) exempt from federal income taxation under Section
28	28	501(a), Internal Revenue Code of 1986, by being certified as an
29	29	exempt organization under Section 501(c)(3) of that code.
30	30	Sec. 373B.004. PURPOSES OF TRUST. The purposes of a trust
31	31	are to:
32	32	(1) provide affordable housing for low-income and
33	33	moderate-income residents in the community;
34	34	(2) promote resident ownership of housing;
35	35	(3) keep housing affordable for future residents; and
36	36	(4) capture the value of public investment for
37	37	long-term community benefit.
38	38	Sec. 373B.005. OWNERSHIP OF LAND AND HOUSING UNITS. A
39	39	community land trust may retain title to land it acquires and may:
40	40	(1) sell housing units located on the land and lease
41	41	the land under ground leases with terms of at least 50 years; or
42	42	(2) lease housing units located on the land.
43	43	Sec. 373B.006. QUALIFICATIONS OF PURCHASERS OR LESSEES OF
44	44	HOUSING UNITS. (a) A community land trust may sell housing units
45	45	only to families with a yearly income at the time of sale at or below
46	46	80 percent of the area median family income, adjusted for family
47	47	size.
48	48	(b) Notwithstanding Subsection (a), if the housing units
49	49	are located on tracts of land owned by the community land trust that
50	50	constitute a contiguous geographic area, the trust may sell not
51	51	more than 20 percent of the housing units to families with a yearly
52	52	income at the time of sale at or below 120 percent of the area median
53	53	family income, adjusted for family size.
54	54	(c) At least 25 percent of the housing units sold by the
55	55	trust must be sold to families with a yearly income at the time of
56	56	sale at or below 60 percent of the area median family income,
57	57	adjusted for family size.
58	58	(d) A community land trust may lease housing units only to
59	59	families with a yearly income at the time of lease at or below 60
60	60	percent of the area median family income, adjusted for family size.
61	61	Sec. 373B.007. RELATION TO OTHER LAW. This chapter does not
62	62	preclude the creation of a land trust by a nonprofit organization,
63	63	including a community housing development organization, under
64	64	other statutory or common law or the operation of that land trust
65	65	inside or outside a municipality or county that has created or
66	66	designated a trust under Section 373B.002.
67	67	Sec. 373B.008. APPLICABILITY OF CHAPTER TO TRUST OPERATED
68	68	BY HOUSING FINANCE CORPORATION. Section 373B.003 does not apply to
69	69	a community land trust operated in the municipality or county by a
70	70	housing finance corporation established under Chapter 394.
71	71	SECTION 2. Subchapter B, Chapter 11, Tax Code, is amended by
72	72	adding Sections 11.1827 and 11.1828 to read as follows:
73	73	Sec. 11.1827. COMMUNITY LAND TRUST. (a) In this section,
74	74	"community land trust" means a community land trust created or
75	75	designated under Section 373B.002, Local Government Code.
76	76	(b) In addition to any other exemption to which the trust
77	77	may be entitled, a community land trust is entitled to an exemption
78	78	from taxation by a taxing unit of land owned by the trust, together
79	79	with the housing units located on the land if they are owned by the
80	80	trust, if:
81	81	(1) the trust:
82	82	(A) meets the requirements of a charitable
83	83	organization provided by Sections 11.18(e) and (f);
84	84	(B) owns the land for the purpose of leasing the
85	85	land and selling or leasing the housing units located on the land as
86	86	provided by Chapter 373B, Local Government Code; and
87	87	(C) engages exclusively in the sale or lease of
88	88	housing as described by Paragraph (B) and related activities; and
89	89	(2) the exemption is adopted by the governing body of
90	90	the taxing unit before July 1 in the manner provided by law for
91	91	official action by the body.
92	92	(c) Property owned by a community land trust may not be
93	93	exempted under Subsection (b) after the third anniversary of the
94	94	date the trust acquires the property unless the trust is offering to
95	95	sell or lease or is leasing the property as provided by Chapter
96	96	373B, Local Government Code.
97	97	(d) A community land trust entitled to an exemption from
98	98	taxation by a taxing unit under Subsection (b) is also entitled to
99	99	an exemption from taxation by the taxing unit of any building or
100	100	tangible personal property the trust owns and uses in the
101	101	administration of its acquisition, construction, repair, sale, or
102	102	leasing of property. To qualify for an exemption under this
103	103	subsection, property must be used exclusively by the organization,
104	104	except that another person may use the property for activities
105	105	incidental to the trust's use that benefit the beneficiaries of the
106	106	trust.
107	107	Sec. 11.1828. MONITORING OF COMPLIANCE BY COMMUNITY LAND
108	108	TRUST WITH AFFORDABLE HOUSING EXEMPTION. (a) To receive an
109	109	exemption under Section 11.1827, a community land trust must
110	110	annually have an audit prepared by an independent auditor. The
111	111	audit must include:
112	112	(1) a detailed report on the trust's sources and uses
113	113	of funds; and
114	114	(2) any other information required by the governing
115	115	body of the municipality or county that created or designated the
116	116	trust under Section 373B.002, Local Government Code.
117	117	(b) A copy of the audit must be delivered to:
118	118	(1) the governing body of the municipality or county
119	119	or an entity designated by the governing body; and
120	120	(2) the chief appraiser of the appraisal district in
121	121	which the property subject to the exemption is located.
122	122	SECTION 3. Subsection (c), Section 11.43, Tax Code, is
123	123	amended to read as follows:
124	124	(c) An exemption provided by Section 11.13, 11.17, 11.18,
125	125	11.182, 11.1827, 11.183, 11.19, 11.20, 11.21, 11.22, 11.23(h), (j),
126	126	or (j-1), 11.29, 11.30, or 11.31, once allowed, need not be claimed
127	127	in subsequent years, and except as otherwise provided by Subsection
128	128	(e), the exemption applies to the property until it changes
129	129	ownership or the person's qualification for the exemption changes.
130	130	However, the chief appraiser may require a person allowed one of the
131	131	exemptions in a prior year to file a new application to confirm the
132	132	person's current qualification for the exemption by delivering a
133	133	written notice that a new application is required, accompanied by
134	134	an appropriate application form, to the person previously allowed
135	135	the exemption.
136	136	SECTION 4. Section 23.21, Tax Code, is amended by adding
137	137	Subsections (c) and (d) to read as follows:
138	138	(c) In appraising land or a housing unit that is leased by a
139	139	community land trust created or designated under Section 373B.002,
140	140	Local Government Code, to a family meeting the income-eligibility
141	141	standards established by Section 373B.006 of that code under
142	142	regulations or restrictions limiting the amount that the family may
143	143	be required to pay for the rental or lease of the property, the
144	144	chief appraiser shall take into account the extent to which that use
145	145	and limitation reduce the market value of the property.
146	146	(d) In appraising a housing unit that the owner or a
147	147	predecessor of the owner acquired from a community land trust
148	148	created or designated under Section 373B.002, Local Government
149	149	Code, and that is located on land owned by the trust and leased by
150	150	the owner of the housing unit, the chief appraiser shall take into
151	151	account the extent to which any regulations or restrictions
152	152	limiting the right of the owner of the housing unit to sell the
153	153	housing unit, including any limitation on the price for which the
154	154	housing unit may be sold, reduce the market value of the housing
155	155	unit.
156	156	SECTION 5. This Act applies only to ad valorem taxes imposed
157	157	for a tax year beginning on or after the effective date of this Act.
158	158	SECTION 6. This Act takes effect January 1, 2010.