84R11602 KJE-F
By: Campbell S.B. No. 1719
A BILL TO BE ENTITLED
AN ACT
relating to the evaluation of an application for a low income
housing tax credit.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 2306.6704(b-1), Government Code, is
amended to read as follows:
(b-1) The preapplication process must require the applicant
to provide the department with evidence that the applicant has
notified the following entities with respect to the filing of the
application:
(1) 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;
(2) the superintendent and the presiding officer of
the board of trustees of the school district containing the
development;
(3) the presiding officer of the governing body of any
municipality containing the development and all elected members of
that body;
(4) the presiding officer of the governing body of the
county containing the development and all elected members of that
body; [and]
(5) all elected members of the board of directors of
any municipal utility district containing the development; and
(6) the state senator and state representative of the
district containing the development.
SECTION 2. Section 2306.6705, Government Code, is amended
to read as follows:
Sec. 2306.6705. GENERAL APPLICATION REQUIREMENTS. An
application must contain at a minimum the following written,
detailed information in a form prescribed by the board:
(1) a description of:
(A) the financing plan for the development,
including any nontraditional financing arrangements;
(B) the use of funds with respect to the
development;
(C) the funding sources for the development,
including:
(i) construction, permanent, and bridge
loans; and
(ii) rents, operating subsidies, and
replacement reserves; and
(D) the commitment status of the funding sources
for the development;
(2) if syndication costs are included in the eligible
basis, a justification of the syndication costs for each cost
category by an attorney or accountant specializing in tax matters;
(3) from a syndicator or a financial consultant of the
applicant, an estimate of the amount of equity dollars expected to
be raised for the development in conjunction with the amount of
housing tax credits requested for allocation to the applicant,
including:
(A) pay-in schedules; and
(B) syndicator consulting fees and other
syndication costs;
(4) if rental assistance, an operating subsidy, or an
annuity is proposed for the development, any related contract or
other agreement securing those funds and an identification of:
(A) the source and annual amount of the funds;
(B) the number of units receiving the funds; and
(C) the term and expiration date of the contract
or other agreement;
(5) if the development is located within the
boundaries of a political subdivision with a zoning ordinance,
evidence in the form of a letter from the chief executive officer of
the political subdivision or from another local official with
jurisdiction over zoning matters that states that:
(A) the development is permitted under the
provisions of the ordinance that apply to the location of the
development; or
(B) the applicant is in the process of seeking
the appropriate zoning and has signed and provided to the political
subdivision a release agreeing to hold the political subdivision
and all other parties harmless in the event that the appropriate
zoning is denied;
(6) if an occupied development is proposed for
rehabilitation:
(A) an explanation of the process used to notify
and consult with the tenants in preparing the application;
(B) a relocation plan outlining:
(i) relocation requirements; and
(ii) a budget with an identified funding
source; and
(C) if applicable, evidence that the relocation
plan has been submitted to the appropriate local agency;
(7) a certification of the applicant's compliance with
appropriate state and federal laws, as required by other state law
or by the board;
(8) any other information required by the board in the
qualified allocation plan; and
(9) evidence that the applicant has notified the
following entities with respect to the filing of the application:
(A) 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;
(B) the superintendent and the presiding officer
of the board of trustees of the school district containing the
development;
(C) the presiding officer of the governing body
of any municipality containing the development and all elected
members of that body;
(D) the presiding officer of the governing body
of the county containing the development and all elected members of
that body; [and]
(E) all elected members of the board of directors
of any municipal utility district containing the development; and
(F) the state senator and state representative of
the district containing the development.
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) 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; or
(iv) the board of directors of a municipal
utility district in which the proposed development site is to be
located;
(C) the income levels of tenants of the
development;
(D) the size and quality of the units;
(E) the commitment of development funding by
local political subdivisions;
(F) the rent levels of the units;
(G) the cost of the development by square foot;
(H) the services to be provided to tenants of the
development;
(I) 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;
(J) 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
(K) the level of community support for the
application, evaluated on the basis of a written statement from:
(i) the state representative who represents
the district containing the proposed development site;
(ii) a member of the commissioners court of
any county containing the proposed development site;
(iii) a member of the governing body of any
municipality containing the proposed development site; or
(iv) an elected member of the board of
directors of a municipal utility 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. 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 begins on or after the effective
date of this Act. An application that is submitted during an
application cycle that began before the effective date of this Act
is governed by the law in effect at the time the application cycle
began, and the former law is continued in effect for that purpose.
SECTION 5. This Act takes effect September 1, 2015.