86R9117 JG-F
By: Thompson of Harris H.B. No. 3732
A BILL TO BE ENTITLED
AN ACT
relating to the creation of an urban land bank by certain
municipalities; granting authority to issue bonds.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle A, Title 12, Local Government Code, is
amended by adding Chapter 379F to read as follows:
CHAPTER 379F. URBAN LAND BANK PROGRAM IN MUNICIPALITY WITH
POPULATION OF TWO MILLION OR MORE
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 379F.001. SHORT TITLE. This chapter may be cited as
the Urban Land Bank Program for a Municipality with a Population of
Two Million or More.
Sec. 379F.002. APPLICABILITY OF CHAPTER. This chapter
applies only to a municipality with a population of two million or
more.
Sec. 379F.003. DEFINITIONS. In this chapter:
(1) "Board" means the board of directors of a land
bank.
(2) "Land bank" means an entity established or
approved by the governing body of a municipality under this
chapter.
(3) "Non-qualifying municipality" means a
municipality to which this chapter does not apply and that is
located in the same county in which a municipality to which this
chapter does apply is predominantly located.
(4) "Real property" means land, land under water, and
any structure, easement, air rights, franchise, or incorporeal
hereditament, every estate, interest, and right therein, legal and
equitable, including terms for years and liens by way of judgment,
mortgage, or otherwise, and any fixture or improvement located
thereon.
Sec. 379F.004. APPLICABILITY OF OTHER LAW. A land bank
created under this chapter:
(1) is:
(A) a governmental unit, as defined by Section
101.001, Civil Practice and Remedies Code;
(B) a local government corporation, as defined by
Section 431.003, Transportation Code; and
(C) a public nonprofit corporation that has and
may exercise all of the rights, powers, privileges, authority, and
functions given by the general laws of this state to nonprofit
corporations in this state;
(2) is not:
(A) a program created or operating under Chapter
373 or 374; or
(B) a housing finance corporation created under
Chapter 394; and
(3) must comply with the requirements of Chapters 551
and 552, Government Code.
Sec. 379F.005. PURPOSE. A land bank created under this
chapter exists for the purpose of acquiring, managing, and
disposing of vacant, abandoned, and deteriorated properties and
returning those properties to productive uses, including
affordable housing, workforce housing, public service housing,
community-based economic development, food desert solutions,
beautification and public art, parks and recreation, flood
reduction and storm resiliency, and other uses necessary and
appropriate to stabilize communities, improve living conditions,
and protect against the displacement of residents of the
municipality served by the land bank.
Sec. 379F.006. CONSTRUCTION. This chapter shall be
construed liberally to carry out the intended purposes as a
complete and independent authorization for the performance of each
and every act and thing authorized by this chapter, and all powers
granted shall be broadly interpreted to carry out the intended
purposes and not as a limitation of powers. Except as otherwise
provided by this chapter, a land bank, in the exercise of its powers
and duties under this chapter and with respect to real property held
by the land bank, has the same amount of control as if the land bank
represented a private property owner, and the land bank is not
subject to restrictions imposed by the charter, ordinances, or
resolutions of a local unit of government.
SUBCHAPTER B. BOARD OF DIRECTORS
Sec. 379F.051. COMPOSITION OF BOARD. The size, membership,
composition, and officers of the board of directors of a land bank,
and methods of appointment to the board, must be established by the
certificate of formation and the bylaws of the land bank.
Sec. 379F.052. ELIGIBILITY FOR MEMBERSHIP. (a) In this
section, "public officer" means an individual who is elected to a
municipal office.
(b) A municipal employee is eligible to serve as a member of
the board, and notwithstanding any law to the contrary, a public
officer is eligible to serve as a member of the board and acceptance
of the appointment will neither terminate nor impair service in the
public office.
Sec. 379F.053. MEETINGS; ATTENDANCE. (a) The board shall
meet in regular session according to a schedule adopted by the
board.
(b) The board may meet in a special session:
(1) convened by the president of the board in
accordance with the bylaws of the board; or
(2) on written notice signed by a majority of the board
members.
(c) The presence of a majority of the board's total
membership constitutes a quorum for any regular or special session.
(d) The board shall establish rules related to the
attendance and participation of members in regular or special
meetings of the board. Rules adopted under this subsection may
provide for the removal from office of a member for failure to
comply with the rules if a majority of the remaining members of the
board vote for the removal. Removal under this subsection takes
effect the first day of the calendar month following the date of the
vote. A person removed under this subsection is ineligible for
reappointment to the board unless reappointment is confirmed
unanimously by the board.
Sec. 379F.054. BOARD ACTIONS. (a) Subject to Subsection
(b), actions of the board must be approved by the affirmative vote
of a quorum of the board.
(b) Action on the following matters requires approval by a
majority of the total membership of the board:
(1) adoption of bylaws or rules for conduct of the
business of the land bank for which the board serves;
(2) hiring or firing of any employee or contractor of
the land bank for which the board serves;
(3) incurring debt;
(4) adoption or amendment of the annual budget; and
(5) sale, lease, encumbrance, or alienation of or
improvements to real or personal property with a value of more than
$50,000.
(c) By majority vote, the board may delegate the hiring and
firing of employees and contractors to a specific officer or
committee of the land bank for which the board serves, under terms
and to the extent specified by the board.
(d) A board member may not vote by proxy.
(e) A board member may request a recorded vote on any
resolution or action of the land bank.
Sec. 379F.055. CONFLICT OF INTEREST. (a) A board member or
employee of a land bank may not:
(1) acquire any direct or indirect interest in real
property of the land bank, in any real property to be acquired by
the land bank, or in any real property to be acquired from the land
bank; or
(2) have any direct or indirect interest in any
contract or proposed contract for materials or services to be
furnished or used by the land bank.
(b) The provisions of the former Texas Non-Profit
Corporation Act (Article 1396-1.01 et seq., Vernon's Texas Civil
Statutes) related to powers, standards of conduct, and interests in
contracts apply to the directors and officers of the land bank.
(c) The board may adopt supplemental rules addressing
potential conflicts of interest and ethical guidelines for board
members and land bank employees.
Sec. 379F.056. COMPENSATION; REIMBURSEMENT. (a) Board
members serve without compensation.
(b) The board may reimburse a member for expenses actually
incurred in the performance of duties on behalf of the land bank.
SUBCHAPTER C. CREATION, OPERATION, AND DISSOLUTION OF LAND BANK
Sec. 379F.101. CREATION OF LAND BANK. The governing body
of a municipality may create a land bank by the adoption of an
ordinance approving the land bank's certificate of formation and
bylaws.
Sec. 379F.102. GENERAL POWERS OF LAND BANK. (a) A land
bank has all powers necessary to carry out the purposes of this
chapter, including the power to:
(1) adopt, amend, and repeal bylaws for the regulation
of the land bank's affairs and the conduct of the land bank's
business;
(2) sue and be sued in the land bank's own name and
plead and be interpleaded in all civil actions, including actions
to clear title to real property of the land bank;
(3) adopt and alter a seal;
(4) borrow funds necessary for the operation of the
land bank from private lenders, municipalities, this state, and the
federal government;
(5) adopt any policy for procurement that is
recognized under state law and permitted for governmental entities,
including a policy recognized under Chapters 252 and 271 of this
code, Chapter 431, Transportation Code, and Chapters 2254 and 2269,
Government Code;
(6) issue negotiable revenue bonds and notes under
this chapter;
(7) procure insurance or guarantees from this state or
the federal government of the payments of any debts or parts of
debts incurred by the land bank and pay premiums in connection with
those debts;
(8) enter into contracts and other agreements
necessary, incidental, or convenient to the performance of the land
bank's duties and the exercise of the land bank's powers, including
governmental agreements under Subchapter D, Chapter 431,
Transportation Code, or interlocal contracts under Section
791.011, Government Code, for the joint exercise of powers under
this chapter;
(9) enter into contracts and other agreements with the
municipality that created the land bank for the performance of
services in accordance with Chapter 311, Tax Code;
(10) make and execute contracts and other instruments
necessary or convenient to the exercise of the land bank's powers;
(11) procure insurance against losses in connection
with the real property, assets, or activities of the land bank;
(12) invest money of the land bank, at the discretion
of the board, in instruments, obligations, securities, or property
determined proper by the board and name and use depositories for the
land bank's money;
(13) enter into contracts for the management of,
collection of rent from, or sale of real property of the land bank;
(14) design, develop, construct, demolish,
reconstruct, rehabilitate, renovate, relocate, or otherwise
improve real property of the land bank;
(15) set, charge, and collect rents, fees, and charges
for the use of real property of the land bank and for services
provided by the land bank;
(16) finance by loan, grant, lease, or otherwise
refinance, construct, erect, assemble, purchase, acquire, own,
repair, remodel, rehabilitate, modify, maintain, extend, improve,
install, sell, equip, expand, add to, operate, or manage real
property of the land bank and pay the costs of those activities from
the proceeds of loans by persons, corporations, limited or general
partnerships, and other entities;
(17) grant or acquire a license, easement, lease, as
lessor or lessee, or option with respect to real property of the
land bank;
(18) enter into partnerships, joint ventures, and
other collaborative relationships with the municipality that
created the land bank and other public and private entities for the
ownership, management, development, and disposition of real
property of the land bank;
(19) make application directly or indirectly to any
federal, state, county, or municipal government or agency or to any
other public or private source for loans, grants, guarantees, or
other financial assistance in furtherance of the land bank's public
purpose and accept and use the loans, grants, guarantees, or
financial assistance on terms prescribed by that federal, state,
county, or municipal government or agency or other source;
(20) as security for the repayment of any notes or
other obligations of the land bank, pledge, mortgage, convey,
assign, hypothecate, or otherwise encumber any property of the land
bank, including real property, fixtures, personal property,
revenue, and other funds, and execute any lease, trust indenture,
trust agreement, agreement for the sale of the land bank's notes of
other obligation, loan agreement, mortgage, security agreement, or
other agreement necessary or desirable as determined by the land
bank; and
(21) hold title to real property for purposes of
establishing contracts with public and private nonprofit community
land trusts, including long-term lease contracts.
(b) A land bank may not:
(1) exercise the power of eminent domain; or
(2) acquire real property outside the geographical
boundaries of the municipality that created the land bank.
Sec. 379F.103. RESOLUTION OF COMPLEX TITLE QUESTIONS. A
land bank may provide assistance and guidance to owners of real
property for which there are complex, highly divided fractional
interests in the real property because of multigenerational
intestate distributions, unknown heirs, and other interested
parties for whom accurate information cannot be ascertained.
Sec. 379F.104. INTERLOCAL CONTRACTS. (a) A land bank may
enter into an interlocal contract under Section 791.011, Government
Code, with:
(1) a municipality for a program created by the
municipality under Chapter 373 or 374; or
(2) a non-qualifying municipality for the purpose of
the land bank conducting land bank activities on behalf of and
within the geographical boundaries of the non-qualifying
municipality.
(b) Notwithstanding Section 379F.102(b)(2), a land bank may
acquire real property within the geographical boundaries of a
non-qualifying municipality with which it has entered into an
agreement under Subsection (a).
Sec. 379F.105. RECORDS AND REPORTS. (a) A land bank shall
keep accurate minutes of the land bank's meetings and shall keep
accurate records and books of account that conform with generally
accepted principles of accounting and that clearly reflect the
income and expenses of the land bank and all transactions in
relation to the land bank's real property.
(b) A land bank shall maintain and make available for public
review and inspection:
(1) an inventory of all real property held by the land
bank;
(2) a copy of the sale settlement statement for each
real property sold or transferred to a third party; and
(3) a copy of the performance report filed under
Subsection (e).
(c) Not later than the 90th day after the end of the fiscal
year of the municipality that created the land bank, the land bank
shall file with the municipality an annual audited financial
statement prepared by a certified public accountant.
(d) Financial transactions of a land bank are subject to
audit by the municipality that created the land bank.
(e) For purposes of evaluating the effectiveness of a land
bank created under this chapter, a land bank shall submit an annual
performance report to the municipality that created the land bank
not later than November 1 of each year in which the land bank
acquires or sells real property in accordance with this chapter.
Sec. 379F.106. STAFF. (a) A land bank may employ an
executive director, counsel and legal staff, technical experts, and
other agents and employees, permanent or temporary, that the land
bank may require and may determine the qualifications and set the
compensation and benefits of each of those persons.
(b) A land bank may enter into contracts and agreements with
municipalities for staffing services to be provided to the land
bank by those municipalities or for the land bank to provide such
staffing services to those municipalities.
Sec. 379F.107. ADVISORY COMMITTEE AND NEIGHBORHOOD
CONSULTATION. (a) A land bank shall create one or more advisory
committees to consult with and advise the land bank on:
(1) properties within the municipality served by the
land bank that are imposing the greatest harm on neighborhoods and
communities in the municipality;
(2) neighborhood priorities for new uses of those
properties; and
(3) the range of potential transferees of those
properties.
(b) As appropriate to the location of the real property of
the land bank, advisory committee membership and neighborhood
consultations shall include formal and informal
neighborhood-specific community associations, residents'
associations, faith communities, community development
corporations, and anchor institutions.
Sec. 379F.108. DISSOLUTION OF LAND BANK. (a) A land bank
may be dissolved no earlier than the 60th day after the date an
affirmative resolution to dissolve the land bank is approved by
two-thirds of the membership of the board and confirmed by
resolution of the municipality that created the land bank.
(b) Not less than 60 days before the consideration of a
resolution of dissolution by the board, the board shall:
(1) provide to the governing body of the municipality
that created the land bank written notice of the board's intent to
vote on a resolution for dissolution of the land bank;
(2) publish the notice in a local newspaper of general
circulation; and
(3) send the notice by certified mail to the trustee of
any outstanding bonds of the land bank.
(c) On dissolution of the land bank, all real property,
personal property, and other assets and obligations of the land
bank become the assets and obligations of the municipality that
created the land bank.
SUBCHAPTER D. ACQUISITION AND DISPOSITION OF PROPERTY
Sec. 379F.151. TAX EXEMPT STATUS OF LAND BANK PROPERTY. The
real property of a land bank, including real property held by a land
bank under a long-term lease contract with a community land trust,
and the land bank's income and operations are exempt as public
property used for public purposes from all license fees, recording
fees, and all other taxes imposed by this state or by political
subdivisions of this state.
Sec. 379F.152. TITLE HELD BY LAND BANK. All real property
acquired by a land bank must be held in the name of the land bank.
Sec. 379F.153. QUIET TITLE ACTIONS. (a) A land bank may
file an action to quiet title as to any real property in which the
land bank has an interest. For purposes of a quiet title action,
the land bank is considered to be the holder of sufficient legal and
equitable interests and possessory rights to qualify the land bank
as an adequate complainant in the action.
(b) Before filing an action to quiet title, the land bank
shall conduct an examination of title to determine the identity of
all persons and entities possessing a claim or interest in or to the
real property. Service of the complaint to quiet title shall be
provided to the interested parties by the following methods:
(1) by first class mail to an identity and address as
reasonably ascertainable by an inspection of public records;
(2) in the case of occupied real property, by
registered or certified mail addressed to "occupant";
(3) by posting a copy of the notice on the real
property;
(4) by publication in a newspaper of general
circulation in the municipality in which the property is located;
and
(5) by another method the court may order.
(c) As part of the complaint to quiet title, a land bank
shall file an affidavit identifying all parties potentially having
an interest in the real property and the form of notice provided.
(d) A court hearing an action under this section shall:
(1) schedule a hearing on the complaint not later than
the 90th day after the date of the filing of the complaint; and
(2) issue a final judgment not later than the 120th day
after the date of the filing of the complaint for all matters on
which an answer was not filed by an interested party.
(e) A land bank may join in a single complaint to quiet title
for one or more parcels of real property.
Sec. 379F.154. ACQUISITION OF PROPERTY GENERALLY. (a) A
land bank may acquire real property by gift, devise, transfer,
exchange, foreclosure, purchase, purchase contracts, lease
purchase agreements, installment sales contracts, land contracts,
or transfers from a municipality on terms as agreed by the land bank
and the municipality, or through any other means on terms and in a
manner the land bank considers appropriate.
(b) Notwithstanding any other law to the contrary, a
municipality served by a land bank or a non-qualifying municipality
that has entered into an interlocal contract with a land bank under
Section 379F.104 may transfer to the land bank real property of the
municipality or non-qualifying municipality on terms and according
to procedures determined by the municipality or non-qualifying
municipality.
(c) A land bank may acquire real property from this state,
the municipality served by the land bank, the county in which that
municipality is located, a governmental entity within the county,
the federal government, or an agency or department of the federal
government.
(d) A land bank shall maintain all of its real property in
accordance with the laws and ordinances of the jurisdiction in
which the real property is located.
Sec. 379F.155. ACQUISITION OF FORECLOSED OR SEIZED
PROPERTY. (a) In this section, "taxing unit" has the meaning
assigned by Section 1.04, Tax Code.
(b) A land bank may submit a written bid to acquire real
property at a tax sale conducted in accordance with Section 34.01,
Tax Code. The bid:
(1) must be in an amount not less than the amount
calculated under Section 34.01(b), Tax Code; and
(2) may be submitted in writing in advance of the
auction or tendered in person at the auction.
(c) If the bid submitted under Subsection (b) is the highest
bid received at the sale, the land bank:
(1) shall:
(A) pay in cash the amount of the costs and
expenses as described by Section 33.48, Tax Code, and any penalties
described by Section 33.07 or 33.08, Tax Code; or
(B) remit payment of the amounts described by
Paragraph (A) to the selling officer by check or electronic funds
transfer not later than the seventh calendar day after the date of
the auction; and
(2) is entitled to credit bid that portion of the bid
amount consisting of the amount of the taxes, penalties, and
interest set forth in the judgment.
(d) A taxing unit that is a party to a judgment of
foreclosure for property sold at auction may request that the
selling officer bid off the property to the taxing unit in the
manner provided by Section 34.01(j), Tax Code, and, if the request
is granted, the transfer to the taxing unit prevails over a bid by
the land bank if the land bank's bid is the only bid sufficient to
satisfy the minimum bid described by Section 34.01(j), Tax Code.
(e) The aggregate amount of all credit bids in a calendar
year shall be considered satisfied by the aggregate expenditure in
that calendar year of an amount equal to or greater than the credit
bid amount, which expenditures are attributable directly and
indirectly to maintenance, rehabilitation, construction,
demolition, and remediation activities. As to any specific tract
of property acquired by the credit bid and transferred by a land
bank to a public entity described by Section 379F.158(a), the
credit bid shall be considered satisfied by that transfer.
(f) A land bank may submit a written request to a taxing unit
at any time for the commencement of tax foreclosure proceedings for
delinquent taxes on real property. The request must include a
commitment to tender a bid in the amount specified under Subsection
(b). On receipt of the written request, the taxing unit, or the
governmental office acting on behalf of the taxing unit, shall
commence enforcement proceedings in accordance with Section 33.41,
Tax Code.
(g) If there is no private third party bid in an amount more
than the bid of the land bank, the real property must be sold to the
land bank.
(h) A sale to a land bank under this section is not a sale to
a taxing unit under Section 34.01(j) or (p) or 34.21, Tax Code.
(i) A land bank may bid an amount higher than the amount
calculated under Section 34.01(b), Tax Code, and if that higher bid
amount is the highest successful bid, the land bank shall pay the
full amount of the bid in cash.
(j) The deed to a land bank vests good and perfect title in
the land bank to the right, title, and interest owned by the
defendants included in the foreclosure judgment, including the
defendants' right to the use and possession of the property,
subject only to the defendants' right of redemption, the terms of a
recorded restrictive covenant running with the land that was
recorded before January 1 of the year in which the tax lien on the
property arose, a recorded lien that arose under that restrictive
covenant that was not extinguished by the judgment foreclosing the
tax lien, and each easement of record as of the date of the sale that
was recorded before January 1 of the year the tax lien arose.
(k) A sale of real property to a land bank under this
section:
(1) extinguishes each lien securing payment of the
delinquent taxes, penalties, and interest against the property and
included in the judgment; and
(2) does not affect the personal liability of any
person for those taxes, penalties, and interest included in the
judgment that are not satisfied from the proceeds of the sale.
(l) A municipality, and any taxing unit levying property
taxes within the geographical jurisdiction of the municipality, may
convey tax foreclosed real property owned by the municipality or
the taxing unit to the land bank on terms and for an amount of
consideration determined by the transferor and the land bank.
Sec. 379F.156. REDEMPTION BY OWNER OF FORECLOSED PROPERTY.
(a) The owner of real property sold to a land bank under Section
379F.155 may redeem the property in the manner prescribed for
owners of real property sold at a tax sale to a purchaser other than
a taxing unit under Section 34.21, Tax Code.
(b) The price to be paid by the owner of real property sold
to a land bank under this section to redeem the property shall be in
the amounts set forth in Sections 34.21(a) and (e), Tax Code. For
the purposes of calculating the price, the bid paid by the land bank
shall be the aggregate amount of the land bank's bid as described by
Section 379F.155(b).
(c) If the owner of real property sold to a land bank under
Section 379F.155 redeems the property by paying to the land bank the
full amount required to redeem as set forth in Sections 34.21(a) and
(e), Tax Code, the land bank shall:
(1) retain an amount equal to the amount paid in cash
by the land bank in accordance with Section 379F.155;
(2) retain any redemption premium and any reasonable
costs the land bank may have expended on maintenance or
environmental remediation of the property being redeemed; and
(3) remit to the county assessor-collector any
remaining amounts to be distributed among the taxing units that
were parties to the judgment of foreclosure in an amount equal to
the proportion of each taxing unit's taxes, penalties, and interest
due in accordance with the judgment of foreclosure.
Sec. 379F.157. DISPOSITION OF PROPERTY GENERALLY. (a) A
land bank may convey, exchange, sell, transfer, lease as lessor,
grant, release and demise, pledge, or hypothecate any interest in,
on, or to real property of the land bank.
(b) A municipality may, in the ordinance creating a land
bank, require that a particular form of disposition of real
property of the land bank, or any disposition of real property
located within a specified jurisdiction of the municipality, be
subject to specified voting and approval requirements of the board.
Unless restricted under this subsection, the board may delegate to
officers and employees the authority to enter into and execute
agreements, instruments of conveyance, and all other related
documents pertaining to the conveyance of real property by the land
bank.
(c) A land bank shall determine the terms, conditions, form,
and substance of consideration necessary and appropriate to convey,
exchange, sell, transfer, lease as lessor, grant, or mortgage as
mortgagor any interest in, on, or to real property of the land bank.
Consideration may take the form of monetary payments and secured
financial obligations, covenants, and conditions related to the
present and future use of the property, deed covenants and
limitations, contractual commitments of the transferee, mortgage
financing, defeasible fees, and other forms of consideration as
determined by the board to be in the best interests of the land
bank. The board shall determine and state in the land bank's
policies and procedures the general terms for consideration to be
received by the land bank for the transfer of real property of the
land bank.
(d) The board may authorize in the board's policies
governing the disposition of land bank property a program for the
disposition of land bank property to owners of contiguous
properties.
(e) A municipality may recommend that a land bank created by
the municipality, and the land bank may in the land bank's own
policies and procedures, establish a hierarchical ranking of
priorities for the use of real property conveyed by the land bank,
including use for:
(1) purely public spaces and places;
(2) flood reduction, storm water retention and
drainage, and storm resiliency;
(3) affordable housing, workforce housing, or public
service housing;
(4) community-based economic development, including
retail, commercial, and industrial activities;
(5) food desert solutions;
(6) beautification and public art, parks, and
recreation;
(7) conservation areas; and
(8) community land trusts or other public entities.
Sec. 379F.158. DISPOSITION OF PROPERTY FOR FLOOD CONTROL
AND STORM WATER DRAINAGE AND PLANNING. (a) A land bank may convey
to a public entity such as a flood control district or a municipal
parks and recreation department real property held by the land
bank:
(1) for which the highest and best use is flood control
or storm water retention or drainage; and
(2) that, as a result of housing and building code
restrictions, flood plain elevations, other local, state, or
federal laws, or public or private agreements, conditions, and
limitations, is no longer capable of being developed or
redeveloped.
(b) The transfer of real property by a land bank under this
section may be:
(1) by grant, deed lease, or other conveyance and may
include additional limitations, restrictions, and conditions
determined by the land bank; and
(2) for nominal consideration, for consideration
consisting of contractual commitments, for an exchange of real
properties, or for other consideration determined by the land bank.
SUBCHAPTER E. FINANCING OF LAND BANK OPERATIONS
Sec. 379F.201. GENERAL FINANCING. (a) A land bank may
receive funding through grants and loans from the municipality that
created the land bank, other municipalities, this state, the
federal government, and other public or private sources.
(b) A land bank may receive and retain payments for services
rendered, for rents and leasehold payments received, for
consideration for disposition of real and personal property, for
proceeds of insurance coverage for losses incurred, for income from
investments, and for any other asset or activity permitted under
this chapter.
Sec. 379F.202. SALE OF LAND BANK PROPERTY. At the time a
land bank sells or otherwise disposes of real property, the
proceeds from the sale, if any, shall be allocated to operations and
expenses of the land bank.
Sec. 379F.203. TAX PENALTY FINANCING. The governing
authority of the municipality that created the land bank, and a
taxing unit within the geographical boundaries of the municipality,
may increase the amount of the penalty imposed for the nonpayment of
real property taxes of the municipality levied within that
jurisdiction under Section 33.01, Tax Code, by increasing the
penalty amount on delinquent taxes on July 1, as described by
Section 33.01(a), Tax Code, from 12 percent to 14 percent or a
higher amount as determined by the municipality or taxing unit. The
supplemental penalty authorized by this subsection applies only to
properties not owned and occupied as a residence homestead as
defined by Section 11.13(j)(1), Tax Code. If the supplemental
penalty is authorized and collected, all such supplemental revenue
must be transferred to the land bank.
Sec. 379F.204. COLLECTION OF TAXES ON PROPERTY CONVEYED BY
LAND BANK. Not more than 75 percent of the real property taxes the
municipality that created the land bank collected on real property,
excluding any school district or county ad valorem tax, conveyed by
a land bank under the laws of this state shall be remitted to the
land bank. The real property taxes of any other taxing unit, as to
real property of the land bank, may also be allocated to the land
bank in a similar manner under an interlocal agreement between the
other taxing unit and the land bank. The specific percentage of
those taxes to be remitted shall be established by ordinance,
resolution, or interlocal cooperation agreement of the land bank.
The allocation of property tax revenue shall begin with the first
taxable year following the date of conveyance and shall continue
for a period of five years. The funds shall be remitted to the land
bank in accordance with the administrative procedures established
by the assessor-collector of the county in which the land bank is
located. The allocation of property tax revenue may not occur if
those taxes have been previously allocated to a tax increment
reinvestment zone, or to secure a debt of the municipality or other
taxing unit, unless the municipality or other taxing unit enters
into an agreement with the land bank for the remittance of those
funds to the land bank. Any property tax revenue allocated to the
land bank under this subsection shall be excluded from the
calculation of ad valorem tax revenue under the municipality's
charter.
Sec. 379F.205. ISSUANCE OF BONDS. (a) A land bank may
issue bonds for the land bank's purposes. The principal and
interest of bonds issued under this section are payable from the
land bank's general revenue. Any bonds issued under this section
may be secured by a pledge of any revenue, including grants or
contributions from this state, the federal government, or any
agency or instrumentality of this state or the federal government,
or by a mortgage of any real property of the land bank.
(b) Bonds issued by a land bank are negotiable instruments
under the law.
(c) Bonds of a land bank issued under this section and the
income from those bonds shall at all times be free from taxation for
state or local purposes under any provision of state law.
(d) Bonds issued by a land bank must be authorized by
resolution of the board and shall be limited obligations of the land
bank.
(e) The principal and interest, costs of issuance, and other
costs incidental to bonds issued under this section shall be
payable solely from the income and revenue derived from the sale,
lease, or other disposition of the assets of the land bank.
(f) In the discretion of the land bank, the bonds may be
additionally secured by mortgage or other security device covering
all or part of the project from which the revenue pledged may be
derived.
(g) Any refunding bonds issued shall be payable from any
source described by this section or from the investment of any of
the proceeds of the refunding bonds, may not constitute an
indebtedness or pledge of the general credit of a municipality or
any other governmental entity within the meaning of any
constitutional or statutory limitation of indebtedness, and must
contain a recital to that effect.
(h) Bonds of the land bank may be issued in the form, may be
in the denominations, may bear interest, may mature in the manner,
and may be executed by one or more members of the board as provided
by the resolution authorizing the issuance of the bonds. The bonds
may be subject to redemption at the option of and in the manner
determined by the board in the resolution authorizing the issuance
of the bonds.
(i) The municipality in which a land bank operates may
guarantee, insure, or otherwise become primarily or secondarily
obligated on the indebtedness of the land bank subject to all other
provisions of state law applicable to municipal indebtedness.
(j) Bonds issued by a land bank shall be issued, sold, and
delivered in accordance with the terms and provisions of a
resolution adopted by the board. The board of a land bank may sell
the bonds in a manner, either at public or at private sale, and for a
price as the board determines to be in the best interests of the
land bank. The resolution issuing bonds shall be published in a
newspaper of general circulation within the jurisdiction of the
land bank.
(k) A board member or a person executing the bonds is not
liable personally on any bonds by reason of the issuance of the
bonds. The bonds or other obligations of the land bank are not a
debt of the municipality that created the land bank or of this state
and must state so on their face. The municipality, this state, or
any revenue or any property of a municipality or this state is not
liable for the bond.
SECTION 2. Section 379E.002, Local Government Code, is
amended to read as follows:
Sec. 379E.002. APPLICABILITY; CONSTRUCTION WITH OTHER LAW.
This chapter applies only to a municipality:
(1) to which Chapter 379C or 379F [or 379D] does not
apply; and
(2) that has not ever adopted a homestead land bank
program under Subchapter E, Chapter 373A.
SECTION 3. Chapter 379D, Local Government Code, is
repealed.
SECTION 4. The Houston Land Bank, a public nonprofit
corporation evidenced by its amended and restated Certificate of
Formation dated September 26, 2018, as filed with the Secretary of
State under File No. 155688901, under ordinance dated HCD 18-51,
approved and adopted by the city council of the City of Houston on
July 25, 2018, and originally created as the Land Assemblage
Redevelopment Authority under Subchapter D, Chapter 431,
Transportation Code, is a land bank under 379F, Local Government
Code, as added by this Act, and shall continue to possess the
statutory authorization by which it was originally created under
Subchapter D, Chapter 431, Transportation Code. All actions of the
board of directors and employees of the Houston Land Bank, all
contracts, agreements, services, and real property acquisitions
and dispositions taken before the effective date of this Act shall
remain unaffected by the adoption of an ordinance under Chapter
379F, Local Government Code, as added by this Act.
SECTION 5. This Act takes effect September 1, 2019.