Texas 2019 - 86th Regular

Texas House Bill HB3732 Compare Versions

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Old	New	Differences
1	1	86R9117 JG-F
2	2	By: Thompson of Harris H.B. No. 3732
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the creation of an urban land bank by certain
8	8	municipalities; granting authority to issue bonds.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Subtitle A, Title 12, Local Government Code, is
11	11	amended by adding Chapter 379F to read as follows:
12	12	CHAPTER 379F. URBAN LAND BANK PROGRAM IN MUNICIPALITY WITH
13	13	POPULATION OF TWO MILLION OR MORE
14	14	SUBCHAPTER A. GENERAL PROVISIONS
15	15	Sec. 379F.001. SHORT TITLE. This chapter may be cited as
16	16	the Urban Land Bank Program for a Municipality with a Population of
17	17	Two Million or More.
18	18	Sec. 379F.002. APPLICABILITY OF CHAPTER. This chapter
19	19	applies only to a municipality with a population of two million or
20	20	more.
21	21	Sec. 379F.003. DEFINITIONS. In this chapter:
22	22	(1) "Board" means the board of directors of a land
23	23	bank.
24	24	(2) "Land bank" means an entity established or
25	25	approved by the governing body of a municipality under this
26	26	chapter.
27	27	(3) "Non-qualifying municipality" means a
28	28	municipality to which this chapter does not apply and that is
29	29	located in the same county in which a municipality to which this
30	30	chapter does apply is predominantly located.
31	31	(4) "Real property" means land, land under water, and
32	32	any structure, easement, air rights, franchise, or incorporeal
33	33	hereditament, every estate, interest, and right therein, legal and
34	34	equitable, including terms for years and liens by way of judgment,
35	35	mortgage, or otherwise, and any fixture or improvement located
36	36	thereon.
37	37	Sec. 379F.004. APPLICABILITY OF OTHER LAW. A land bank
38	38	created under this chapter:
39	39	(1) is:
40	40	(A) a governmental unit, as defined by Section
41	41	101.001, Civil Practice and Remedies Code;
42	42	(B) a local government corporation, as defined by
43	43	Section 431.003, Transportation Code; and
44	44	(C) a public nonprofit corporation that has and
45	45	may exercise all of the rights, powers, privileges, authority, and
46	46	functions given by the general laws of this state to nonprofit
47	47	corporations in this state;
48	48	(2) is not:
49	49	(A) a program created or operating under Chapter
50	50	373 or 374; or
51	51	(B) a housing finance corporation created under
52	52	Chapter 394; and
53	53	(3) must comply with the requirements of Chapters 551
54	54	and 552, Government Code.
55	55	Sec. 379F.005. PURPOSE. A land bank created under this
56	56	chapter exists for the purpose of acquiring, managing, and
57	57	disposing of vacant, abandoned, and deteriorated properties and
58	58	returning those properties to productive uses, including
59	59	affordable housing, workforce housing, public service housing,
60	60	community-based economic development, food desert solutions,
61	61	beautification and public art, parks and recreation, flood
62	62	reduction and storm resiliency, and other uses necessary and
63	63	appropriate to stabilize communities, improve living conditions,
64	64	and protect against the displacement of residents of the
65	65	municipality served by the land bank.
66	66	Sec. 379F.006. CONSTRUCTION. This chapter shall be
67	67	construed liberally to carry out the intended purposes as a
68	68	complete and independent authorization for the performance of each
69	69	and every act and thing authorized by this chapter, and all powers
70	70	granted shall be broadly interpreted to carry out the intended
71	71	purposes and not as a limitation of powers. Except as otherwise
72	72	provided by this chapter, a land bank, in the exercise of its powers
73	73	and duties under this chapter and with respect to real property held
74	74	by the land bank, has the same amount of control as if the land bank
75	75	represented a private property owner, and the land bank is not
76	76	subject to restrictions imposed by the charter, ordinances, or
77	77	resolutions of a local unit of government.
78	78	SUBCHAPTER B. BOARD OF DIRECTORS
79	79	Sec. 379F.051. COMPOSITION OF BOARD. The size, membership,
80	80	composition, and officers of the board of directors of a land bank,
81	81	and methods of appointment to the board, must be established by the
82	82	certificate of formation and the bylaws of the land bank.
83	83	Sec. 379F.052. ELIGIBILITY FOR MEMBERSHIP. (a) In this
84	84	section, "public officer" means an individual who is elected to a
85	85	municipal office.
86	86	(b) A municipal employee is eligible to serve as a member of
87	87	the board, and notwithstanding any law to the contrary, a public
88	88	officer is eligible to serve as a member of the board and acceptance
89	89	of the appointment will neither terminate nor impair service in the
90	90	public office.
91	91	Sec. 379F.053. MEETINGS; ATTENDANCE. (a) The board shall
92	92	meet in regular session according to a schedule adopted by the
93	93	board.
94	94	(b) The board may meet in a special session:
95	95	(1) convened by the president of the board in
96	96	accordance with the bylaws of the board; or
97	97	(2) on written notice signed by a majority of the board
98	98	members.
99	99	(c) The presence of a majority of the board's total
100	100	membership constitutes a quorum for any regular or special session.
101	101	(d) The board shall establish rules related to the
102	102	attendance and participation of members in regular or special
103	103	meetings of the board. Rules adopted under this subsection may
104	104	provide for the removal from office of a member for failure to
105	105	comply with the rules if a majority of the remaining members of the
106	106	board vote for the removal. Removal under this subsection takes
107	107	effect the first day of the calendar month following the date of the
108	108	vote. A person removed under this subsection is ineligible for
109	109	reappointment to the board unless reappointment is confirmed
110	110	unanimously by the board.
111	111	Sec. 379F.054. BOARD ACTIONS. (a) Subject to Subsection
112	112	(b), actions of the board must be approved by the affirmative vote
113	113	of a quorum of the board.
114	114	(b) Action on the following matters requires approval by a
115	115	majority of the total membership of the board:
116	116	(1) adoption of bylaws or rules for conduct of the
117	117	business of the land bank for which the board serves;
118	118	(2) hiring or firing of any employee or contractor of
119	119	the land bank for which the board serves;
120	120	(3) incurring debt;
121	121	(4) adoption or amendment of the annual budget; and
122	122	(5) sale, lease, encumbrance, or alienation of or
123	123	improvements to real or personal property with a value of more than
124	124	$50,000.
125	125	(c) By majority vote, the board may delegate the hiring and
126	126	firing of employees and contractors to a specific officer or
127	127	committee of the land bank for which the board serves, under terms
128	128	and to the extent specified by the board.
129	129	(d) A board member may not vote by proxy.
130	130	(e) A board member may request a recorded vote on any
131	131	resolution or action of the land bank.
132	132	Sec. 379F.055. CONFLICT OF INTEREST. (a) A board member or
133	133	employee of a land bank may not:
134	134	(1) acquire any direct or indirect interest in real
135	135	property of the land bank, in any real property to be acquired by
136	136	the land bank, or in any real property to be acquired from the land
137	137	bank; or
138	138	(2) have any direct or indirect interest in any
139	139	contract or proposed contract for materials or services to be
140	140	furnished or used by the land bank.
141	141	(b) The provisions of the former Texas Non-Profit
142	142	Corporation Act (Article 1396-1.01 et seq., Vernon's Texas Civil
143	143	Statutes) related to powers, standards of conduct, and interests in
144	144	contracts apply to the directors and officers of the land bank.
145	145	(c) The board may adopt supplemental rules addressing
146	146	potential conflicts of interest and ethical guidelines for board
147	147	members and land bank employees.
148	148	Sec. 379F.056. COMPENSATION; REIMBURSEMENT. (a) Board
149	149	members serve without compensation.
150	150	(b) The board may reimburse a member for expenses actually
151	151	incurred in the performance of duties on behalf of the land bank.
152	152	SUBCHAPTER C. CREATION, OPERATION, AND DISSOLUTION OF LAND BANK
153	153	Sec. 379F.101. CREATION OF LAND BANK. The governing body
154	154	of a municipality may create a land bank by the adoption of an
155	155	ordinance approving the land bank's certificate of formation and
156	156	bylaws.
157	157	Sec. 379F.102. GENERAL POWERS OF LAND BANK. (a) A land
158	158	bank has all powers necessary to carry out the purposes of this
159	159	chapter, including the power to:
160	160	(1) adopt, amend, and repeal bylaws for the regulation
161	161	of the land bank's affairs and the conduct of the land bank's
162	162	business;
163	163	(2) sue and be sued in the land bank's own name and
164	164	plead and be interpleaded in all civil actions, including actions
165	165	to clear title to real property of the land bank;
166	166	(3) adopt and alter a seal;
167	167	(4) borrow funds necessary for the operation of the
168	168	land bank from private lenders, municipalities, this state, and the
169	169	federal government;
170	170	(5) adopt any policy for procurement that is
171	171	recognized under state law and permitted for governmental entities,
172	172	including a policy recognized under Chapters 252 and 271 of this
173	173	code, Chapter 431, Transportation Code, and Chapters 2254 and 2269,
174	174	Government Code;
175	175	(6) issue negotiable revenue bonds and notes under
176	176	this chapter;
177	177	(7) procure insurance or guarantees from this state or
178	178	the federal government of the payments of any debts or parts of
179	179	debts incurred by the land bank and pay premiums in connection with
180	180	those debts;
181	181	(8) enter into contracts and other agreements
182	182	necessary, incidental, or convenient to the performance of the land
183	183	bank's duties and the exercise of the land bank's powers, including
184	184	governmental agreements under Subchapter D, Chapter 431,
185	185	Transportation Code, or interlocal contracts under Section
186	186	791.011, Government Code, for the joint exercise of powers under
187	187	this chapter;
188	188	(9) enter into contracts and other agreements with the
189	189	municipality that created the land bank for the performance of
190	190	services in accordance with Chapter 311, Tax Code;
191	191	(10) make and execute contracts and other instruments
192	192	necessary or convenient to the exercise of the land bank's powers;
193	193	(11) procure insurance against losses in connection
194	194	with the real property, assets, or activities of the land bank;
195	195	(12) invest money of the land bank, at the discretion
196	196	of the board, in instruments, obligations, securities, or property
197	197	determined proper by the board and name and use depositories for the
198	198	land bank's money;
199	199	(13) enter into contracts for the management of,
200	200	collection of rent from, or sale of real property of the land bank;
201	201	(14) design, develop, construct, demolish,
202	202	reconstruct, rehabilitate, renovate, relocate, or otherwise
203	203	improve real property of the land bank;
204	204	(15) set, charge, and collect rents, fees, and charges
205	205	for the use of real property of the land bank and for services
206	206	provided by the land bank;
207	207	(16) finance by loan, grant, lease, or otherwise
208	208	refinance, construct, erect, assemble, purchase, acquire, own,
209	209	repair, remodel, rehabilitate, modify, maintain, extend, improve,
210	210	install, sell, equip, expand, add to, operate, or manage real
211	211	property of the land bank and pay the costs of those activities from
212	212	the proceeds of loans by persons, corporations, limited or general
213	213	partnerships, and other entities;
214	214	(17) grant or acquire a license, easement, lease, as
215	215	lessor or lessee, or option with respect to real property of the
216	216	land bank;
217	217	(18) enter into partnerships, joint ventures, and
218	218	other collaborative relationships with the municipality that
219	219	created the land bank and other public and private entities for the
220	220	ownership, management, development, and disposition of real
221	221	property of the land bank;
222	222	(19) make application directly or indirectly to any
223	223	federal, state, county, or municipal government or agency or to any
224	224	other public or private source for loans, grants, guarantees, or
225	225	other financial assistance in furtherance of the land bank's public
226	226	purpose and accept and use the loans, grants, guarantees, or
227	227	financial assistance on terms prescribed by that federal, state,
228	228	county, or municipal government or agency or other source;
229	229	(20) as security for the repayment of any notes or
230	230	other obligations of the land bank, pledge, mortgage, convey,
231	231	assign, hypothecate, or otherwise encumber any property of the land
232	232	bank, including real property, fixtures, personal property,
233	233	revenue, and other funds, and execute any lease, trust indenture,
234	234	trust agreement, agreement for the sale of the land bank's notes of
235	235	other obligation, loan agreement, mortgage, security agreement, or
236	236	other agreement necessary or desirable as determined by the land
237	237	bank; and
238	238	(21) hold title to real property for purposes of
239	239	establishing contracts with public and private nonprofit community
240	240	land trusts, including long-term lease contracts.
241	241	(b) A land bank may not:
242	242	(1) exercise the power of eminent domain; or
243	243	(2) acquire real property outside the geographical
244	244	boundaries of the municipality that created the land bank.
245	245	Sec. 379F.103. RESOLUTION OF COMPLEX TITLE QUESTIONS. A
246	246	land bank may provide assistance and guidance to owners of real
247	247	property for which there are complex, highly divided fractional
248	248	interests in the real property because of multigenerational
249	249	intestate distributions, unknown heirs, and other interested
250	250	parties for whom accurate information cannot be ascertained.
251	251	Sec. 379F.104. INTERLOCAL CONTRACTS. (a) A land bank may
252	252	enter into an interlocal contract under Section 791.011, Government
253	253	Code, with:
254	254	(1) a municipality for a program created by the
255	255	municipality under Chapter 373 or 374; or
256	256	(2) a non-qualifying municipality for the purpose of
257	257	the land bank conducting land bank activities on behalf of and
258	258	within the geographical boundaries of the non-qualifying
259	259	municipality.
260	260	(b) Notwithstanding Section 379F.102(b)(2), a land bank may
261	261	acquire real property within the geographical boundaries of a
262	262	non-qualifying municipality with which it has entered into an
263	263	agreement under Subsection (a).
264	264	Sec. 379F.105. RECORDS AND REPORTS. (a) A land bank shall
265	265	keep accurate minutes of the land bank's meetings and shall keep
266	266	accurate records and books of account that conform with generally
267	267	accepted principles of accounting and that clearly reflect the
268	268	income and expenses of the land bank and all transactions in
269	269	relation to the land bank's real property.
270	270	(b) A land bank shall maintain and make available for public
271	271	review and inspection:
272	272	(1) an inventory of all real property held by the land
273	273	bank;
274	274	(2) a copy of the sale settlement statement for each
275	275	real property sold or transferred to a third party; and
276	276	(3) a copy of the performance report filed under
277	277	Subsection (e).
278	278	(c) Not later than the 90th day after the end of the fiscal
279	279	year of the municipality that created the land bank, the land bank
280	280	shall file with the municipality an annual audited financial
281	281	statement prepared by a certified public accountant.
282	282	(d) Financial transactions of a land bank are subject to
283	283	audit by the municipality that created the land bank.
284	284	(e) For purposes of evaluating the effectiveness of a land
285	285	bank created under this chapter, a land bank shall submit an annual
286	286	performance report to the municipality that created the land bank
287	287	not later than November 1 of each year in which the land bank
288	288	acquires or sells real property in accordance with this chapter.
289	289	Sec. 379F.106. STAFF. (a) A land bank may employ an
290	290	executive director, counsel and legal staff, technical experts, and
291	291	other agents and employees, permanent or temporary, that the land
292	292	bank may require and may determine the qualifications and set the
293	293	compensation and benefits of each of those persons.
294	294	(b) A land bank may enter into contracts and agreements with
295	295	municipalities for staffing services to be provided to the land
296	296	bank by those municipalities or for the land bank to provide such
297	297	staffing services to those municipalities.
298	298	Sec. 379F.107. ADVISORY COMMITTEE AND NEIGHBORHOOD
299	299	CONSULTATION. (a) A land bank shall create one or more advisory
300	300	committees to consult with and advise the land bank on:
301	301	(1) properties within the municipality served by the
302	302	land bank that are imposing the greatest harm on neighborhoods and
303	303	communities in the municipality;
304	304	(2) neighborhood priorities for new uses of those
305	305	properties; and
306	306	(3) the range of potential transferees of those
307	307	properties.
308	308	(b) As appropriate to the location of the real property of
309	309	the land bank, advisory committee membership and neighborhood
310	310	consultations shall include formal and informal
311	311	neighborhood-specific community associations, residents'
312	312	associations, faith communities, community development
313	313	corporations, and anchor institutions.
314	314	Sec. 379F.108. DISSOLUTION OF LAND BANK. (a) A land bank
315	315	may be dissolved no earlier than the 60th day after the date an
316	316	affirmative resolution to dissolve the land bank is approved by
317	317	two-thirds of the membership of the board and confirmed by
318	318	resolution of the municipality that created the land bank.
319	319	(b) Not less than 60 days before the consideration of a
320	320	resolution of dissolution by the board, the board shall:
321	321	(1) provide to the governing body of the municipality
322	322	that created the land bank written notice of the board's intent to
323	323	vote on a resolution for dissolution of the land bank;
324	324	(2) publish the notice in a local newspaper of general
325	325	circulation; and
326	326	(3) send the notice by certified mail to the trustee of
327	327	any outstanding bonds of the land bank.
328	328	(c) On dissolution of the land bank, all real property,
329	329	personal property, and other assets and obligations of the land
330	330	bank become the assets and obligations of the municipality that
331	331	created the land bank.
332	332	SUBCHAPTER D. ACQUISITION AND DISPOSITION OF PROPERTY
333	333	Sec. 379F.151. TAX EXEMPT STATUS OF LAND BANK PROPERTY. The
334	334	real property of a land bank, including real property held by a land
335	335	bank under a long-term lease contract with a community land trust,
336	336	and the land bank's income and operations are exempt as public
337	337	property used for public purposes from all license fees, recording
338	338	fees, and all other taxes imposed by this state or by political
339	339	subdivisions of this state.
340	340	Sec. 379F.152. TITLE HELD BY LAND BANK. All real property
341	341	acquired by a land bank must be held in the name of the land bank.
342	342	Sec. 379F.153. QUIET TITLE ACTIONS. (a) A land bank may
343	343	file an action to quiet title as to any real property in which the
344	344	land bank has an interest. For purposes of a quiet title action,
345	345	the land bank is considered to be the holder of sufficient legal and
346	346	equitable interests and possessory rights to qualify the land bank
347	347	as an adequate complainant in the action.
348	348	(b) Before filing an action to quiet title, the land bank
349	349	shall conduct an examination of title to determine the identity of
350	350	all persons and entities possessing a claim or interest in or to the
351	351	real property. Service of the complaint to quiet title shall be
352	352	provided to the interested parties by the following methods:
353	353	(1) by first class mail to an identity and address as
354	354	reasonably ascertainable by an inspection of public records;
355	355	(2) in the case of occupied real property, by
356	356	registered or certified mail addressed to "occupant";
357	357	(3) by posting a copy of the notice on the real
358	358	property;
359	359	(4) by publication in a newspaper of general
360	360	circulation in the municipality in which the property is located;
361	361	and
362	362	(5) by another method the court may order.
363	363	(c) As part of the complaint to quiet title, a land bank
364	364	shall file an affidavit identifying all parties potentially having
365	365	an interest in the real property and the form of notice provided.
366	366	(d) A court hearing an action under this section shall:
367	367	(1) schedule a hearing on the complaint not later than
368	368	the 90th day after the date of the filing of the complaint; and
369	369	(2) issue a final judgment not later than the 120th day
370	370	after the date of the filing of the complaint for all matters on
371	371	which an answer was not filed by an interested party.
372	372	(e) A land bank may join in a single complaint to quiet title
373	373	for one or more parcels of real property.
374	374	Sec. 379F.154. ACQUISITION OF PROPERTY GENERALLY. (a) A
375	375	land bank may acquire real property by gift, devise, transfer,
376	376	exchange, foreclosure, purchase, purchase contracts, lease
377	377	purchase agreements, installment sales contracts, land contracts,
378	378	or transfers from a municipality on terms as agreed by the land bank
379	379	and the municipality, or through any other means on terms and in a
380	380	manner the land bank considers appropriate.
381	381	(b) Notwithstanding any other law to the contrary, a
382	382	municipality served by a land bank or a non-qualifying municipality
383	383	that has entered into an interlocal contract with a land bank under
384	384	Section 379F.104 may transfer to the land bank real property of the
385	385	municipality or non-qualifying municipality on terms and according
386	386	to procedures determined by the municipality or non-qualifying
387	387	municipality.
388	388	(c) A land bank may acquire real property from this state,
389	389	the municipality served by the land bank, the county in which that
390	390	municipality is located, a governmental entity within the county,
391	391	the federal government, or an agency or department of the federal
392	392	government.
393	393	(d) A land bank shall maintain all of its real property in
394	394	accordance with the laws and ordinances of the jurisdiction in
395	395	which the real property is located.
396	396	Sec. 379F.155. ACQUISITION OF FORECLOSED OR SEIZED
397	397	PROPERTY. (a) In this section, "taxing unit" has the meaning
398	398	assigned by Section 1.04, Tax Code.
399	399	(b) A land bank may submit a written bid to acquire real
400	400	property at a tax sale conducted in accordance with Section 34.01,
401	401	Tax Code. The bid:
402	402	(1) must be in an amount not less than the amount
403	403	calculated under Section 34.01(b), Tax Code; and
404	404	(2) may be submitted in writing in advance of the
405	405	auction or tendered in person at the auction.
406	406	(c) If the bid submitted under Subsection (b) is the highest
407	407	bid received at the sale, the land bank:
408	408	(1) shall:
409	409	(A) pay in cash the amount of the costs and
410	410	expenses as described by Section 33.48, Tax Code, and any penalties
411	411	described by Section 33.07 or 33.08, Tax Code; or
412	412	(B) remit payment of the amounts described by
413	413	Paragraph (A) to the selling officer by check or electronic funds
414	414	transfer not later than the seventh calendar day after the date of
415	415	the auction; and
416	416	(2) is entitled to credit bid that portion of the bid
417	417	amount consisting of the amount of the taxes, penalties, and
418	418	interest set forth in the judgment.
419	419	(d) A taxing unit that is a party to a judgment of
420	420	foreclosure for property sold at auction may request that the
421	421	selling officer bid off the property to the taxing unit in the
422	422	manner provided by Section 34.01(j), Tax Code, and, if the request
423	423	is granted, the transfer to the taxing unit prevails over a bid by
424	424	the land bank if the land bank's bid is the only bid sufficient to
425	425	satisfy the minimum bid described by Section 34.01(j), Tax Code.
426	426	(e) The aggregate amount of all credit bids in a calendar
427	427	year shall be considered satisfied by the aggregate expenditure in
428	428	that calendar year of an amount equal to or greater than the credit
429	429	bid amount, which expenditures are attributable directly and
430	430	indirectly to maintenance, rehabilitation, construction,
431	431	demolition, and remediation activities. As to any specific tract
432	432	of property acquired by the credit bid and transferred by a land
433	433	bank to a public entity described by Section 379F.158(a), the
434	434	credit bid shall be considered satisfied by that transfer.
435	435	(f) A land bank may submit a written request to a taxing unit
436	436	at any time for the commencement of tax foreclosure proceedings for
437	437	delinquent taxes on real property. The request must include a
438	438	commitment to tender a bid in the amount specified under Subsection
439	439	(b). On receipt of the written request, the taxing unit, or the
440	440	governmental office acting on behalf of the taxing unit, shall
441	441	commence enforcement proceedings in accordance with Section 33.41,
442	442	Tax Code.
443	443	(g) If there is no private third party bid in an amount more
444	444	than the bid of the land bank, the real property must be sold to the
445	445	land bank.
446	446	(h) A sale to a land bank under this section is not a sale to
447	447	a taxing unit under Section 34.01(j) or (p) or 34.21, Tax Code.
448	448	(i) A land bank may bid an amount higher than the amount
449	449	calculated under Section 34.01(b), Tax Code, and if that higher bid
450	450	amount is the highest successful bid, the land bank shall pay the
451	451	full amount of the bid in cash.
452	452	(j) The deed to a land bank vests good and perfect title in
453	453	the land bank to the right, title, and interest owned by the
454	454	defendants included in the foreclosure judgment, including the
455	455	defendants' right to the use and possession of the property,
456	456	subject only to the defendants' right of redemption, the terms of a
457	457	recorded restrictive covenant running with the land that was
458	458	recorded before January 1 of the year in which the tax lien on the
459	459	property arose, a recorded lien that arose under that restrictive
460	460	covenant that was not extinguished by the judgment foreclosing the
461	461	tax lien, and each easement of record as of the date of the sale that
462	462	was recorded before January 1 of the year the tax lien arose.
463	463	(k) A sale of real property to a land bank under this
464	464	section:
465	465	(1) extinguishes each lien securing payment of the
466	466	delinquent taxes, penalties, and interest against the property and
467	467	included in the judgment; and
468	468	(2) does not affect the personal liability of any
469	469	person for those taxes, penalties, and interest included in the
470	470	judgment that are not satisfied from the proceeds of the sale.
471	471	(l) A municipality, and any taxing unit levying property
472	472	taxes within the geographical jurisdiction of the municipality, may
473	473	convey tax foreclosed real property owned by the municipality or
474	474	the taxing unit to the land bank on terms and for an amount of
475	475	consideration determined by the transferor and the land bank.
476	476	Sec. 379F.156. REDEMPTION BY OWNER OF FORECLOSED PROPERTY.
477	477	(a) The owner of real property sold to a land bank under Section
478	478	379F.155 may redeem the property in the manner prescribed for
479	479	owners of real property sold at a tax sale to a purchaser other than
480	480	a taxing unit under Section 34.21, Tax Code.
481	481	(b) The price to be paid by the owner of real property sold
482	482	to a land bank under this section to redeem the property shall be in
483	483	the amounts set forth in Sections 34.21(a) and (e), Tax Code. For
484	484	the purposes of calculating the price, the bid paid by the land bank
485	485	shall be the aggregate amount of the land bank's bid as described by
486	486	Section 379F.155(b).
487	487	(c) If the owner of real property sold to a land bank under
488	488	Section 379F.155 redeems the property by paying to the land bank the
489	489	full amount required to redeem as set forth in Sections 34.21(a) and
490	490	(e), Tax Code, the land bank shall:
491	491	(1) retain an amount equal to the amount paid in cash
492	492	by the land bank in accordance with Section 379F.155;
493	493	(2) retain any redemption premium and any reasonable
494	494	costs the land bank may have expended on maintenance or
495	495	environmental remediation of the property being redeemed; and
496	496	(3) remit to the county assessor-collector any
497	497	remaining amounts to be distributed among the taxing units that
498	498	were parties to the judgment of foreclosure in an amount equal to
499	499	the proportion of each taxing unit's taxes, penalties, and interest
500	500	due in accordance with the judgment of foreclosure.
501	501	Sec. 379F.157. DISPOSITION OF PROPERTY GENERALLY. (a) A
502	502	land bank may convey, exchange, sell, transfer, lease as lessor,
503	503	grant, release and demise, pledge, or hypothecate any interest in,
504	504	on, or to real property of the land bank.
505	505	(b) A municipality may, in the ordinance creating a land
506	506	bank, require that a particular form of disposition of real
507	507	property of the land bank, or any disposition of real property
508	508	located within a specified jurisdiction of the municipality, be
509	509	subject to specified voting and approval requirements of the board.
510	510	Unless restricted under this subsection, the board may delegate to
511	511	officers and employees the authority to enter into and execute
512	512	agreements, instruments of conveyance, and all other related
513	513	documents pertaining to the conveyance of real property by the land
514	514	bank.
515	515	(c) A land bank shall determine the terms, conditions, form,
516	516	and substance of consideration necessary and appropriate to convey,
517	517	exchange, sell, transfer, lease as lessor, grant, or mortgage as
518	518	mortgagor any interest in, on, or to real property of the land bank.
519	519	Consideration may take the form of monetary payments and secured
520	520	financial obligations, covenants, and conditions related to the
521	521	present and future use of the property, deed covenants and
522	522	limitations, contractual commitments of the transferee, mortgage
523	523	financing, defeasible fees, and other forms of consideration as
524	524	determined by the board to be in the best interests of the land
525	525	bank. The board shall determine and state in the land bank's
526	526	policies and procedures the general terms for consideration to be
527	527	received by the land bank for the transfer of real property of the
528	528	land bank.
529	529	(d) The board may authorize in the board's policies
530	530	governing the disposition of land bank property a program for the
531	531	disposition of land bank property to owners of contiguous
532	532	properties.
533	533	(e) A municipality may recommend that a land bank created by
534	534	the municipality, and the land bank may in the land bank's own
535	535	policies and procedures, establish a hierarchical ranking of
536	536	priorities for the use of real property conveyed by the land bank,
537	537	including use for:
538	538	(1) purely public spaces and places;
539	539	(2) flood reduction, storm water retention and
540	540	drainage, and storm resiliency;
541	541	(3) affordable housing, workforce housing, or public
542	542	service housing;
543	543	(4) community-based economic development, including
544	544	retail, commercial, and industrial activities;
545	545	(5) food desert solutions;
546	546	(6) beautification and public art, parks, and
547	547	recreation;
548	548	(7) conservation areas; and
549	549	(8) community land trusts or other public entities.
550	550	Sec. 379F.158. DISPOSITION OF PROPERTY FOR FLOOD CONTROL
551	551	AND STORM WATER DRAINAGE AND PLANNING. (a) A land bank may convey
552	552	to a public entity such as a flood control district or a municipal
553	553	parks and recreation department real property held by the land
554	554	bank:
555	555	(1) for which the highest and best use is flood control
556	556	or storm water retention or drainage; and
557	557	(2) that, as a result of housing and building code
558	558	restrictions, flood plain elevations, other local, state, or
559	559	federal laws, or public or private agreements, conditions, and
560	560	limitations, is no longer capable of being developed or
561	561	redeveloped.
562	562	(b) The transfer of real property by a land bank under this
563	563	section may be:
564	564	(1) by grant, deed lease, or other conveyance and may
565	565	include additional limitations, restrictions, and conditions
566	566	determined by the land bank; and
567	567	(2) for nominal consideration, for consideration
568	568	consisting of contractual commitments, for an exchange of real
569	569	properties, or for other consideration determined by the land bank.
570	570	SUBCHAPTER E. FINANCING OF LAND BANK OPERATIONS
571	571	Sec. 379F.201. GENERAL FINANCING. (a) A land bank may
572	572	receive funding through grants and loans from the municipality that
573	573	created the land bank, other municipalities, this state, the
574	574	federal government, and other public or private sources.
575	575	(b) A land bank may receive and retain payments for services
576	576	rendered, for rents and leasehold payments received, for
577	577	consideration for disposition of real and personal property, for
578	578	proceeds of insurance coverage for losses incurred, for income from
579	579	investments, and for any other asset or activity permitted under
580	580	this chapter.
581	581	Sec. 379F.202. SALE OF LAND BANK PROPERTY. At the time a
582	582	land bank sells or otherwise disposes of real property, the
583	583	proceeds from the sale, if any, shall be allocated to operations and
584	584	expenses of the land bank.
585	585	Sec. 379F.203. TAX PENALTY FINANCING. The governing
586	586	authority of the municipality that created the land bank, and a
587	587	taxing unit within the geographical boundaries of the municipality,
588	588	may increase the amount of the penalty imposed for the nonpayment of
589	589	real property taxes of the municipality levied within that
590	590	jurisdiction under Section 33.01, Tax Code, by increasing the
591	591	penalty amount on delinquent taxes on July 1, as described by
592	592	Section 33.01(a), Tax Code, from 12 percent to 14 percent or a
593	593	higher amount as determined by the municipality or taxing unit. The
594	594	supplemental penalty authorized by this subsection applies only to
595	595	properties not owned and occupied as a residence homestead as
596	596	defined by Section 11.13(j)(1), Tax Code. If the supplemental
597	597	penalty is authorized and collected, all such supplemental revenue
598	598	must be transferred to the land bank.
599	599	Sec. 379F.204. COLLECTION OF TAXES ON PROPERTY CONVEYED BY
600	600	LAND BANK. Not more than 75 percent of the real property taxes the
601	601	municipality that created the land bank collected on real property,
602	602	excluding any school district or county ad valorem tax, conveyed by
603	603	a land bank under the laws of this state shall be remitted to the
604	604	land bank. The real property taxes of any other taxing unit, as to
605	605	real property of the land bank, may also be allocated to the land
606	606	bank in a similar manner under an interlocal agreement between the
607	607	other taxing unit and the land bank. The specific percentage of
608	608	those taxes to be remitted shall be established by ordinance,
609	609	resolution, or interlocal cooperation agreement of the land bank.
610	610	The allocation of property tax revenue shall begin with the first
611	611	taxable year following the date of conveyance and shall continue
612	612	for a period of five years. The funds shall be remitted to the land
613	613	bank in accordance with the administrative procedures established
614	614	by the assessor-collector of the county in which the land bank is
615	615	located. The allocation of property tax revenue may not occur if
616	616	those taxes have been previously allocated to a tax increment
617	617	reinvestment zone, or to secure a debt of the municipality or other
618	618	taxing unit, unless the municipality or other taxing unit enters
619	619	into an agreement with the land bank for the remittance of those
620	620	funds to the land bank. Any property tax revenue allocated to the
621	621	land bank under this subsection shall be excluded from the
622	622	calculation of ad valorem tax revenue under the municipality's
623	623	charter.
624	624	Sec. 379F.205. ISSUANCE OF BONDS. (a) A land bank may
625	625	issue bonds for the land bank's purposes. The principal and
626	626	interest of bonds issued under this section are payable from the
627	627	land bank's general revenue. Any bonds issued under this section
628	628	may be secured by a pledge of any revenue, including grants or
629	629	contributions from this state, the federal government, or any
630	630	agency or instrumentality of this state or the federal government,
631	631	or by a mortgage of any real property of the land bank.
632	632	(b) Bonds issued by a land bank are negotiable instruments
633	633	under the law.
634	634	(c) Bonds of a land bank issued under this section and the
635	635	income from those bonds shall at all times be free from taxation for
636	636	state or local purposes under any provision of state law.
637	637	(d) Bonds issued by a land bank must be authorized by
638	638	resolution of the board and shall be limited obligations of the land
639	639	bank.
640	640	(e) The principal and interest, costs of issuance, and other
641	641	costs incidental to bonds issued under this section shall be
642	642	payable solely from the income and revenue derived from the sale,
643	643	lease, or other disposition of the assets of the land bank.
644	644	(f) In the discretion of the land bank, the bonds may be
645	645	additionally secured by mortgage or other security device covering
646	646	all or part of the project from which the revenue pledged may be
647	647	derived.
648	648	(g) Any refunding bonds issued shall be payable from any
649	649	source described by this section or from the investment of any of
650	650	the proceeds of the refunding bonds, may not constitute an
651	651	indebtedness or pledge of the general credit of a municipality or
652	652	any other governmental entity within the meaning of any
653	653	constitutional or statutory limitation of indebtedness, and must
654	654	contain a recital to that effect.
655	655	(h) Bonds of the land bank may be issued in the form, may be
656	656	in the denominations, may bear interest, may mature in the manner,
657	657	and may be executed by one or more members of the board as provided
658	658	by the resolution authorizing the issuance of the bonds. The bonds
659	659	may be subject to redemption at the option of and in the manner
660	660	determined by the board in the resolution authorizing the issuance
661	661	of the bonds.
662	662	(i) The municipality in which a land bank operates may
663	663	guarantee, insure, or otherwise become primarily or secondarily
664	664	obligated on the indebtedness of the land bank subject to all other
665	665	provisions of state law applicable to municipal indebtedness.
666	666	(j) Bonds issued by a land bank shall be issued, sold, and
667	667	delivered in accordance with the terms and provisions of a
668	668	resolution adopted by the board. The board of a land bank may sell
669	669	the bonds in a manner, either at public or at private sale, and for a
670	670	price as the board determines to be in the best interests of the
671	671	land bank. The resolution issuing bonds shall be published in a
672	672	newspaper of general circulation within the jurisdiction of the
673	673	land bank.
674	674	(k) A board member or a person executing the bonds is not
675	675	liable personally on any bonds by reason of the issuance of the
676	676	bonds. The bonds or other obligations of the land bank are not a
677	677	debt of the municipality that created the land bank or of this state
678	678	and must state so on their face. The municipality, this state, or
679	679	any revenue or any property of a municipality or this state is not
680	680	liable for the bond.
681	681	SECTION 2. Section 379E.002, Local Government Code, is
682	682	amended to read as follows:
683	683	Sec. 379E.002. APPLICABILITY; CONSTRUCTION WITH OTHER LAW.
684	684	This chapter applies only to a municipality:
685	685	(1) to which Chapter 379C or 379F [or 379D] does not
686	686	apply; and
687	687	(2) that has not ever adopted a homestead land bank
688	688	program under Subchapter E, Chapter 373A.
689	689	SECTION 3. Chapter 379D, Local Government Code, is
690	690	repealed.
691	691	SECTION 4. The Houston Land Bank, a public nonprofit
692	692	corporation evidenced by its amended and restated Certificate of
693	693	Formation dated September 26, 2018, as filed with the Secretary of
694	694	State under File No. 155688901, under ordinance dated HCD 18-51,
695	695	approved and adopted by the city council of the City of Houston on
696	696	July 25, 2018, and originally created as the Land Assemblage
697	697	Redevelopment Authority under Subchapter D, Chapter 431,
698	698	Transportation Code, is a land bank under 379F, Local Government
699	699	Code, as added by this Act, and shall continue to possess the
700	700	statutory authorization by which it was originally created under
701	701	Subchapter D, Chapter 431, Transportation Code. All actions of the
702	702	board of directors and employees of the Houston Land Bank, all
703	703	contracts, agreements, services, and real property acquisitions
704	704	and dispositions taken before the effective date of this Act shall
705	705	remain unaffected by the adoption of an ordinance under Chapter
706	706	379F, Local Government Code, as added by this Act.
707	707	SECTION 5. This Act takes effect September 1, 2019.