By: West S.B. No. 1895
A BILL TO BE ENTITLED
AN ACT
relating to certain programs established by a municipality to
provide affordable housing.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 374.003, Local Government Code, is
amended by adding Subdivision (1-a) and amending Subdivision (25)
to read as follows:
(1-a) "Affordable housing" means housing that is
affordable to households earning 70 percent or less of the area
median family income, adjusted for household size, as determined
annually by the United States Department of Housing and Urban
Development.
(25) "Urban renewal activities" includes slum
clearance, redevelopment, rehabilitation, and conservation
activities to prevent further deterioration of an area that is
tending to become a blighted or slum area. The term includes:
(A) the acquisition of all or part of a slum area
or blighted area or the acquisition of land that is predominantly
open and that, because of obsolete platting, diversity of
ownership, deterioration of structures or site improvements, or for
other reasons, substantially impairs or arrests the sound growth of
the community;
(B) the demolition and removal of buildings and
improvements;
(C) the installation, construction, or
reconstruction of streets, utilities, parks, playgrounds, and
other improvements necessary to fulfill urban renewal objectives in
accordance with an urban renewal plan;
(D) the disposition by the municipality of
property acquired in an urban renewal area for use in accordance
with an urban renewal plan, including:
(i) the sale or initial lease of the
property at its fair value;
(ii) [or] the retention of the property;
and
(iii) the transfer of the property to a
nonprofit corporation or foundation to be operated exclusively as
affordable housing;
(E) the implementation of plans for a program of
voluntary repair and rehabilitation of buildings or improvements in
accordance with an urban renewal plan; and
(F) the acquisition of real property in an urban
renewal area as necessary to remove or prevent the spread of blight
or deterioration or to provide land for needed public facilities.
SECTION 2. Section 374.017, Local Government Code, is
amended by amending Subsections (c) and (d) and adding Subsection
(d-1) to read as follows:
(c) The purchaser, [or] lessee, or transferee of property
transferred under this section, and a successor in interest to such
a person, including an assignee, must devote the property to the
uses specified in the urban renewal plan and may be obligated to
comply with conditions specified in the deed of conveyance,
including the requirement to begin any improvements required by the
urban renewal plan within a reasonable time.
(d) Except as provided by Subsection (d-1), real [Real]
property or an interest in real property subject to this section may
only be sold, leased, or otherwise transferred or retained at not
less than the fair value of the property for uses in accordance with
the urban renewal plan. In determining the fair value, the
municipality shall consider:
(1) the uses provided in the urban renewal plan;
(2) any restrictions on and any covenants, conditions,
and obligations assumed by the purchaser, lessee, or municipality
in retaining the property;
(3) the objectives of the plan for the prevention of
the recurrence of slums or blighted areas; and
(4) any other matters that the municipality specifies
as appropriate.
(d-1) A municipality may transfer to a public or private
nonprofit corporation or foundation real property or an interest in
real property subject to this section for less than fair market
value, but only if the deed of conveyance includes a right of
reverter so that the property will revert to the municipality if the
property is not used exclusively for the provision of affordable
housing.
SECTION 3. Section 380.001(a), Local Government Code, is
amended to read as follows:
(a) The governing body of a municipality may establish and
provide for the administration of one or more programs, including
programs for making loans and grants of public money or real
property and providing personnel and services of the municipality,
to promote state or local economic development, [and] to stimulate
business and commercial activity in the municipality, and to
provide affordable housing in the municipality. For purposes of
this subsection, a municipality includes an area that:
(1) has been annexed by the municipality for limited
purposes; or
(2) is in the extraterritorial jurisdiction of the
municipality.
SECTION 4. Section 380.002(a), Local Government Code, is
amended to read as follows:
(a) A home-rule municipality with a population of more than
100,000 may create programs for the grant of public money to any
organization exempt from taxation under Section 501(a) of the
Internal Revenue Code of 1986 as an organization described in
Section 501(c)(3) of that code for the public purposes of
development and diversification of the economy of the state,
elimination of unemployment or underemployment in the state, and
development or expansion of commerce in the state. The
municipality may also create programs for the grant of real
property owned by the municipality to such an organization for the
public purpose of providing affordable housing in the municipality.
The grants must be in furtherance of those public purposes and shall
be used by the recipient as determined by the recipient's governing
board for programs found by the municipality to be in furtherance of
this section and under conditions prescribed by the municipality.
SECTION 5. This Act takes effect September 1, 2015.