Texas 2015 - 84th Regular

Texas House Bill HB4015 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1		84R22717 JAM-F
2	2		By: Martinez Fischer H.B. No. 4015
3		-	Substitute the following for H.B. No. 4015:
4		-	By: Wu C.S.H.B. No. 4015
5	3
6	4
7	5		A BILL TO BE ENTITLED
8	6		AN ACT
9	7		relating to land bank demonstration programs.
10	8		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
11	9		SECTION 1. Chapter 379C, Local Government Code, is amended
12	10		by adding Section 379C.015 to read as follows:
13	11		Sec. 379C.015. PARTICIPATION IN COUNTY LAND BANK PROGRAM.
14	12		(a) A land bank established or approved by the governing body of a
15	13		municipality under this chapter may participate in a land bank
16	14		program established or approved by a county under Chapter 388 if the
17	15		participation of the municipality in the county land bank program
18	16		is incorporated into each entity's land bank demonstration plan
19	17		under Sections 379C.006 and 388.005, as applicable.
20	18		(b) The authority of a municipally established land bank
21	19		participating in a program established under Chapter 388 is limited
22	20		to the powers granted under this chapter.
23	21		SECTION 2. Subtitle B, Title 12, Local Government Code, is
24	22		amended by adding Chapter 388 to read as follows:
25	23		CHAPTER 388. LAND BANK DEMONSTRATION PROGRAM
26	24		Sec. 388.001. APPLICABILITY. This chapter applies only to
27	25		a county that:
28	26		(1) contains a majority of the territory of a
29	27		home-rule municipality that has a population of 1.18 million or
30	28		more; and
31	29		(2) has a total area of less than 1,300 square miles.
32	30		Sec. 388.002. DEFINITIONS. In this chapter:
33	31		(1) "Community housing development organization" or
34	32		"organization" means an organization that:
35	33		(A) meets the definition of a community housing
36	34		development organization in 24 C.F.R. Section 92.2; and
37	35		(B) is certified by the county as a community
38	36		housing development organization.
39	37		(2) "Land bank" means an entity established or
40	38		approved by the governing body of a county for the purpose of
41	39		acquiring, holding, and transferring unimproved real property
42	40		under this chapter.
43	41		(3) "Land bank demonstration plan" or "plan" means a
44	42		plan adopted by the governing body of a county as provided by
45	43		Section 388.005.
46	44		(4) "Land bank demonstration program" or "program"
47	45		means a program adopted under Section 388.003.
48	46		(5) "Low income household" means a household with a
49	47		gross income of not greater than 115 percent of the area median
50	48		family income, adjusted for household size, for the county, as
51	49		determined annually by the United States Department of Housing and
52	50		Urban Development.
53	51		(6) "Qualified participating developer" means a
54	52		developer who meets the requirements of Section 388.004 and
55	53		includes a qualified organization under Section 388.013.
56	54		Sec. 388.003. LAND BANK DEMONSTRATION PROGRAM. (a) The
57	55		governing body of a county may adopt a land bank demonstration
58	56		program in which the officer charged with selling real property
59	57		ordered sold pursuant to foreclosure of a tax lien may sell certain
60	58		eligible real property by private sale for purposes of affordable
61	59		housing development as provided by this chapter.
62	60		(b) The governing body of a county that adopts a land bank
63	61		demonstration program shall establish or approve a land bank for
64	62		the purpose of acquiring, holding, and transferring unimproved real
65	63		property under this chapter.
66	64		Sec. 388.004. QUALIFIED PARTICIPATING DEVELOPER. To
67	65		qualify to participate in a land bank demonstration program, a
68	66		developer must:
69	67		(1) have built one or more housing units within the
70	68		three-year period preceding the submission of a proposal to the
71	69		land bank seeking to acquire real property from the land bank;
72	70		(2) have a development plan approved by the county for
73	71		the land bank property; and
74	72		(3) meet any other requirements adopted by the county
75	73		in the land bank demonstration plan.
76	74		Sec. 388.005. LAND BANK DEMONSTRATION PLAN. (a) A county
77	75		that adopts a land bank demonstration program shall operate the
78	76		program in conformance with a land bank demonstration plan.
79	77		(b) The governing body of a county that adopts a land bank
80	78		demonstration program shall adopt a plan annually. The plan may be
81	79		amended from time to time.
82	80		(c) In developing the plan, the county shall consider any
83	81		other housing plans adopted by the county, including any fair
84	82		housing plans and policies adopted or agreed to by the county.
85	83		(d) The plan must include the following:
86	84		(1) a list of community housing development
87	85		organizations eligible to participate in the right of first refusal
88	86		provided by Section 388.013;
89	87		(2) a list of the parcels of real property that may
90	88		become eligible for sale to the land bank during the upcoming year;
91	89		(3) the county's plan for affordable housing
92	90		development on those parcels of real property; and
93	91		(4) the sources and amounts of funding anticipated to
94	92		be available from the county for subsidies for development of
95	93		affordable housing in the county, including any money specifically
96	94		available for housing developed under the program, as approved by
97	95		the governing body of the county at the time the plan is adopted.
98	96		Sec. 388.006. PUBLIC HEARING ON PROPOSED PLAN. (a) Before
99	97		adopting a plan, a county shall hold a public hearing on the
100	98		proposed plan.
101	99		(b) The county clerk or the county clerk's designee shall
102	100		provide notice of the hearing to all community housing development
103	101		organizations and to neighborhood associations identified by the
104	102		county as serving the neighborhoods in which properties anticipated
105	103		to be available for sale to the land bank under this chapter are
106	104		located.
107	105		(c) The county clerk or the county clerk's designee shall
108	106		make copies of the proposed plan available to the public not later
109	107		than the 60th day before the date of the public hearing.
110	108		Sec. 388.007. PRIVATE SALE TO LAND BANK. (a)
111	109		Notwithstanding any other law and except as provided by Subsection
112	110		(g), property that is ordered sold pursuant to foreclosure of a tax
113	111		lien may be sold in a private sale to a land bank by the officer
114	112		charged with the sale of the property without first offering the
115	113		property for sale as otherwise provided by Section 34.01, Tax Code,
116	114		if:
117	115		(1) the market value of the property as specified in
118	116		the judgment of foreclosure is less than the total amount due under
119	117		the judgment, including all taxes, penalties, and interest, plus
120	118		the value of nontax liens held by a taxing unit and awarded by the
121	119		judgment, court costs, and the cost of the sale;
122	120		(2) the property is not improved with a habitable
123	121		building or buildings or an uninhabitable building or buildings
124	122		that are occupied as a residence by an owner or tenant who is
125	123		legally entitled to occupy the building or buildings;
126	124		(3) there are delinquent taxes on the property for a
127	125		total of at least five years; and
128	126		(4) the county has executed with the other taxing
129	127		units that are parties to the tax suit an interlocal agreement that
130	128		enables those units to agree to participate in the program while
131	129		retaining the right to withhold consent to the sale of specific
132	130		properties to the land bank.
133	131		(b) The property may be sold to a land bank, regardless of
134	132		current zoning, and on development may be zoned for more than one
135	133		use that must include residential housing in accordance with this
136	134		chapter, provided that the requirements of Subsection (a) are
137	135		satisfied.
138	136		(c) A sale of property for use in connection with the
139	137		program is a sale for a public purpose.
140	138		(d) If the person being sued in a suit for foreclosure of a
141	139		tax lien does not contest the market value of the property in the
142	140		suit, the person waives the right to challenge the amount of the
143	141		market value determined by the court for purposes of the sale of the
144	142		property under Section 33.50, Tax Code.
145	143		(e) For any sale of property under this chapter, each person
146	144		who was a defendant to the judgment, or that person's attorney,
147	145		shall be given, not later than the 90th day before the date of sale,
148	146		written notice of the proposed method of sale of the property by the
149	147		officer charged with the sale of the property. Notice shall be
150	148		given in the manner prescribed by Rule 21a, Texas Rules of Civil
151	149		Procedure.
152	150		(f) After receipt of the notice required by Subsection (e)
153	151		and before the date of the proposed sale, the owner of the property
154	152		subject to sale may file with the officer charged with the sale a
155	153		written request that the property not be sold in the manner provided
156	154		by this chapter.
157	155		(g) If the officer charged with the sale receives a written
158	156		request as provided by Subsection (f), the officer shall sell the
159	157		property as otherwise provided in Section 34.01, Tax Code.
160	158		(h) The owner of the property subject to sale may not
161	159		receive any proceeds of a sale under this chapter. However, the
162	160		owner does not have any personal liability for a deficiency of the
163	161		judgment as a result of a sale under this chapter.
164	162		(i) Notwithstanding any other law, if consent is given by
165	163		the taxing units that are a party to the judgment, property may be
166	164		sold to the land bank for less than the market value of the property
167	165		as specified in the judgment or less than the total of all taxes,
168	166		penalties, and interest, plus the value of nontax liens held by a
169	167		taxing unit and awarded by the judgment, court costs, and the cost
170	168		of the sale.
171	169		(j) The deed of conveyance of the property sold to a land
172	170		bank under this section conveys to the land bank the right, title,
173	171		and interest acquired or held by each taxing unit that was a party
174	172		to the judgment, subject to the right of redemption.
175	173		Sec. 388.008. SUBSEQUENT RESALE BY LAND BANK. (a) Except
176	174		as provided by Subsection (b), each subsequent resale of property
177	175		acquired by a land bank under this chapter must comply with the
178	176		conditions of this section.
179	177		(b) Notwithstanding any other law, this section does not
180	178		apply to property sold to an eligible adjacent property owner under
181	179		Section 388.011.
182	180		(c) Except as provided by Subsection (d), the land bank must
183	181		sell a property to a qualified participating developer within the
184	182		four-year period following the date of acquisition for the purpose
185	183		of construction of affordable housing for sale or rent to low income
186	184		households.
187	185		(d) Before the completion of the four-year period described
188	186		by Subsection (c), the land bank may, subject to Section 388.011:
189	187		(1) transfer property that the land bank determines is
190	188		not appropriate for residential development to the taxing units
191	189		described by Subsection (c); or
192	190		(2) sell property described by Subdivision (1) to a
193	191		political subdivision or a nonprofit organization.
194	192		(e) If after four years a qualified participating developer
195	193		has not purchased the property, the property shall be transferred
196	194		from the land bank to the taxing units who were parties to the
197	195		judgment for disposition as otherwise allowed under the law.
198	196		(f) Unless the county increases the amount in its plan, the
199	197		number of properties acquired by a qualified participating
200	198		developer under this section on which development has not been
201	199		completed may not at any given time exceed three times the annual
202	200		average residential production completed by the qualified
203	201		participating developer during the preceding two-year period as
204	202		determined by the county.
205	203		(g) The deed conveying a property sold by the land bank must
206	204		include a right of reverter so that if the qualified participating
207	205		developer does not apply for a construction permit and close on any
208	206		construction financing within the three-year period following the
209	207		date of the conveyance of the property from the land bank to the
210	208		qualified participating developer, the property will revert to the
211	209		land bank for subsequent resale in accordance with this chapter or
212	210		conveyance to the taxing units who were parties to the judgment for
213	211		disposition as otherwise allowed under the law. If the property is
214	212		replatted under Section 388.012, the right of reverter applies to
215	213		the entire property as replatted.
216	214		Sec. 388.009. RESTRICTIONS ON OCCUPANCY AND USE OF
217	215		PROPERTY. (a) The land bank shall impose deed restrictions on
218	216		property sold to qualified participating developers requiring the
219	217		development and sale, rental, or lease-purchase of the property to
220	218		low income households.
221	219		(b) Each land bank property sold during any given fiscal
222	220		year to be developed for sale must be deed restricted for sale to
223	221		low income households, and:
224	222		(1) at least 25 percent of those land bank properties
225	223		must be deed restricted for sale to households with gross household
226	224		incomes not greater than 60 percent of the area median family
227	225		income, adjusted for household size; and
228	226		(2) not more than 30 percent of those land bank
229	227		properties may be deed restricted for sale to households with gross
230	228		household incomes greater than 80 percent of the area median family
231	229		income, adjusted for household size.
232	230		(c) If property is developed for rental housing, the deed
233	231		restrictions must be for a period of not less than 15 years and must
234	232		require that:
235	233		(1) 100 percent of the rental units be occupied by
236	234		households with incomes not greater than 60 percent of area median
237	235		family income, based on gross household income, adjusted for
238	236		household size, for the county, as determined annually by the
239	237		United States Department of Housing and Urban Development;
240	238		(2) 40 percent of the units be occupied by households
241	239		with incomes not greater than 50 percent of area median family
242	240		income, based on gross household income, adjusted for household
243	241		size, for the county, as determined annually by the United States
244	242		Department of Housing and Urban Development; or
245	243		(3) 20 percent of the units be occupied by households
246	244		with incomes not greater than 30 percent of area median family
247	245		income, based on gross household income, adjusted for household
248	246		size, for the county, as determined annually by the United States
249	247		Department of Housing and Urban Development.
250	248		(d) The deed restrictions under Subsection (c) must require
251	249		the owner to file an annual occupancy report with the county on a
252	250		reporting form provided by the county. The deed restrictions must
253	251		also prohibit any exclusion of an individual or family from
254	252		admission to the development based solely on the participation of
255	253		the individual or family in the housing choice voucher program
256	254		under Section 8, United States Housing Act of 1937 (42 U.S.C.
257	255		Section 1437f), as amended.
258	256		(e) Except as otherwise provided by this section, if the
259	257		deed restrictions imposed under this section are for a term of
260	258		years, the deed restrictions shall renew automatically.
261	259		(f) The land bank or the governing body of the county may
262	260		modify or add to the deed restrictions imposed under this section.
263	261		Any modifications or additions made by the governing body of the
264	262		county must be adopted by the county as part of its plan and must
265	263		comply with the restrictions set forth in Subsections (b), (c), and
266	264		(d).
267	265		Sec. 388.010. LOT EXCHANGE PERMITTED. (a) Notwithstanding
268	266		Section 388.009, the land bank may permit a qualified participating
269	267		developer to exchange a property purchased from the land bank with
270	268		any other property owned by the developer if:
271	269		(1) the developer agrees to construct on the other
272	270		property affordable housing for low income households as provided
273	271		by this chapter; and
274	272		(2) the other property will be located in:
275	273		(A) a planned development incorporating the
276	274		property originally purchased from the land bank; or
277	275		(B) another location as approved by the land
278	276		bank.
279	277		(b) The land bank shall adjust the deed restrictions under
280	278		Section 388.009 for each of the properties exchanged by the
281	279		developer under this section.
282	280		Sec. 388.011. PROPERTY DETERMINED TO BE INAPPROPRIATE FOR
283	281		RESIDENTIAL DEVELOPMENT: RIGHT OF FIRST REFUSAL. (a) In this
284	282		section, "eligible adjacent property owner" means a person who:
285	283		(1) owns property located adjacent to property owned
286	284		by the land bank; and
287	285		(2) satisfies eligibility requirements adopted by the
288	286		land bank.
289	287		(b) Notwithstanding any other right of first refusal
290	288		granted under this chapter, if the land bank determines that a
291	289		property owned by the land bank is not appropriate for residential
292	290		development, the land bank first shall offer the property for sale
293	291		to an eligible adjacent property owner according to terms and
294	292		conditions developed by the land bank that are consistent with this
295	293		chapter.
296	294		(c) The land bank shall sell the property to an eligible
297	295		adjacent property owner, at whichever value is lower:
298	296		(1) the fair market value for the property as
299	297		determined by the appraisal district in which the property is
300	298		located; or
301	299		(2) the sales price recorded in the annual plan.
302	300		(d) Except as provided by Subsection (e), an adjacent
303	301		property owner that purchases property under this section may not
304	302		lease, sell, or transfer that property to another person before the
305	303		third anniversary of the date the adjacent property owner purchased
306	304		that property from the land bank.
307	305		(e) Subsection (d) does not apply to the transfer of
308	306		property purchased under this section if the transfer:
309	307		(1) is made according to a policy adopted by the land
310	308		bank; and
311	309		(2) is made to a family member of the eligible adjacent
312	310		property owner or occurs as a result of the death of the eligible
313	311		adjacent property owner.
314	312		Sec. 388.012. REPLATTING BY QUALIFIED PARTICIPATING
315	313		DEVELOPER. The land bank may sell two adjacent properties that are
316	314		owned by the land bank to a qualified participating developer if:
317	315		(1) at least one of the properties is appropriate for
318	316		residential development; and
319	317		(2) the developer agrees to replat the two adjacent
320	318		properties as one property that is appropriate for residential
321	319		development.
322	320		Sec. 388.013. RIGHT OF FIRST REFUSAL TO QUALIFIED
323	321		ORGANIZATIONS. (a) In this section, "qualified organization"
324	322		means a community housing development organization that:
325	323		(1) contains within its designated geographical
326	324		boundaries of operation, as set forth in its application for
327	325		certification filed with and approved by the county, a portion of
328	326		the property that the land bank is offering for sale;
329	327		(2) has built at least three single-family homes or
330	328		duplexes or one multifamily residential dwelling of four or more
331	329		units in compliance with all applicable building codes within the
332	330		preceding two-year period and within the organization's designated
333	331		geographical boundaries of operation; and
334	332		(3) within the preceding two-year period has built or
335	333		rehabilitated housing units within a one-half mile radius of the
336	334		property that the land bank is offering for sale.
337	335		(b) Except as provided by Section 388.011, the land bank
338	336		shall first offer a property for sale to qualified organizations.
339	337		(c) Notice must be provided to the qualified organizations
340	338		by certified mail, return receipt requested.
341	339		(d) The county shall specify in its plan that the period
342	340		during which the right of first refusal provided by this section may
343	341		be exercised by a qualified organization is six months from the date
344	342		of the deed of conveyance of the property to the land bank.
345	343		(e) During the specified period, the land bank may not sell
346	344		the property to a qualified participating developer other than a
347	345		qualified organization. If all qualified organizations notify the
348	346		land bank that they are declining to exercise their right of first
349	347		refusal during the specified period, or if an offer to purchase the
350	348		property is not received from a qualified organization during that
351	349		period, the land bank may sell the property to any other qualified
352	350		participating developer at the same price that the land bank
353	351		offered the property to the qualified organizations.
354	352		(f) In its plan, the county shall establish the amount of
355	353		additional time, if any, that a property may be held in the land
356	354		bank once an offer has been received and accepted from a qualified
357	355		organization or other qualified participating developer.
358	356		(g) If more than one qualified organization expresses an
359	357		interest in exercising its right of first refusal, the organization
360	358		that has designated the most geographically compact area
361	359		encompassing a portion of the property shall be given priority.
362	360		(h) In its plan, the county may provide for other rights of
363	361		first refusal for any other nonprofit corporation exempted from
364	362		federal income tax under Section 501(c)(3), Internal Revenue Code
365	363		of 1986, as amended, provided that the preeminent right of first
366	364		refusal is provided to qualified organizations as provided by this
367	365		section.
368	366		(i) The land bank is not required to provide a right of first
369	367		refusal to qualified organizations under this section if the land
370	368		bank is selling property that reverted to the land bank under
371	369		Section 388.008(g).
372	370		Sec. 388.014. OPEN RECORDS AND MEETINGS. The land bank
373	371		shall comply with the requirements of Chapters 551 and 552,
374	372		Government Code.
375	373		Sec. 388.015. RECORDS; AUDIT; REPORT. (a) The land bank
376	374		shall keep accurate minutes of its meetings and shall keep accurate
377	375		records and books of account that conform with generally accepted
378	376		principles of accounting and that clearly reflect the income and
379	377		expenses of the land bank and all transactions in relation to its
380	378		property.
381	379		(b) The land bank shall file with the county not later than
382	380		the 90th day after the close of the fiscal year annual audited
383	381		financial statements prepared by a certified public accountant.
384	382		The financial transactions of the land bank are subject to audit by
385	383		the county.
386	384		(c) For purposes of evaluating the effectiveness of the
387	385		program, the land bank shall submit an annual performance report to
388	386		the county not later than November 1 of each year in which the land
389	387		bank acquires or sells property under this chapter. The
390	388		performance report must include:
391	389		(1) a complete and detailed written accounting of all
392	390		money and properties received and disbursed by the land bank during
393	391		the preceding fiscal year;
394	392		(2) for each property acquired by the land bank during
395	393		the preceding fiscal year:
396	394		(A) the street address of the property;
397	395		(B) the legal description of the property;
398	396		(C) the date the land bank took title to the
399	397		property;
400	398		(D) the name and address of the property owner of
401	399		record at the time of the foreclosure;
402	400		(E) the amount of taxes and other costs owed at
403	401		the time of the foreclosure; and
404	402		(F) the assessed value of the property on the tax
405	403		roll at the time of the foreclosure;
406	404		(3) for each property sold by the land bank during the
407	405		preceding fiscal year to a qualified participating developer or
408	406		eligible adjacent property owner:
409	407		(A) the street address of the property;
410	408		(B) the legal description of the property;
411	409		(C) the name and mailing address of the
412	410		purchaser;
413	411		(D) the purchase price paid; and
414	412		(E) if sold to a qualified participating
415	413		developer:
416	414		(i) the maximum incomes allowed for the
417	415		households by the terms of the sale; and
418	416		(ii) the source and amount of any public
419	417		subsidy provided by the county to facilitate the sale or rental of
420	418		the property to a household within the targeted income levels;
421	419		(4) for each property sold by a qualified
422	420		participating developer during the preceding fiscal year, the
423	421		buyer's household income and a description of all use and sale
424	422		restrictions; and
425	423		(5) for each property developed for rental housing
426	424		with an active deed restriction, a copy of the most recent annual
427	425		report filed by the owner with the land bank.
428	426		(d) The land bank shall maintain in its records for
429	427		inspection a copy of the sale settlement statement for each
430	428		property sold by a qualified participating developer and a copy of
431	429		the first page of the mortgage note with the interest rate and
432	430		indicating the volume and page number of the instrument as filed
433	431		with the county clerk.
434	432		(e) The land bank shall provide copies of the performance
435	433		report to the taxing units who were parties to the judgment of
436	434		foreclosure and shall provide notice of the availability of the
437	435		performance report for review to the organizations and neighborhood
438	436		associations identified by the county as serving the neighborhoods
439	437		in which properties sold to the land bank under this chapter are
440	438		located.
441	439		(f) The land bank and the county shall maintain copies of
442	440		the performance report available for public review.
443	441		Sec. 388.016. PARTICIPATION IN MUNICIPAL LAND BANK PROGRAM.
444	442		(a) A land bank established or approved by the governing body of a
445	443		county under this chapter may participate in a land bank program
446	444		established or approved by a municipality under Chapter 379C if the
447	445		participation of the county in the municipal land bank program is
448	446		incorporated into each entity's land bank demonstration plan under
449	447		Sections 379C.006 and 388.005, as applicable.
450	448		(b) The authority of a county-established land bank
451	449		participating in a program established under Chapter 379C is
452	450		limited to the powers granted under this chapter.
453	451		SECTION 3. This Act takes effect September 1, 2015.