Texas 2019 - 86th Regular

Texas Senate Bill SB1117 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1		By: Lucio S.B. No. 1117
	2	+	(In the Senate - Filed February 26, 2019; March 7, 2019,
	3	+	read first time and referred to Committee on Intergovernmental
	4	+	Relations; April 15, 2019, reported adversely, with favorable
	5	+	Committee Substitute by the following vote: Yeas 6, Nays 1;
	6	+	April 15, 2019, sent to printer.)
	7	+	Click here to see the committee vote
	8	+	COMMITTEE SUBSTITUTE FOR S.B. No. 1117 By: Alvarado
2	9
3	10
4	11		A BILL TO BE ENTITLED
5	12		AN ACT
6	13		relating to the functions of certain urban land bank programs.
7	14		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
8	15		SECTION 1. Section 379E.003, Local Government Code, is
9	16		amended by amending Subdivision (3) and adding Subdivision (4-a) to
10	17		read as follows:
11	18		(3) "Land bank" means an entity established or
12	19		approved by the governing body of a municipality to exercise [for]
13	20		the powers [purpose] of acquiring, holding, developing, and
14	21		transferring [unimproved] real property under this chapter.
15	22		(4-a) "Moderate income household" means a household
16	23		that:
17	24		(A) requires assistance in securing sanitary,
18	25		decent, and safe housing, considering:
19	26		(i) the amount of the total income
20	27		available for housing needs of the individuals or families who are
21	28		members of the household;
22	29		(ii) the size of the household;
23	30		(iii) the cost and condition of available
24	31		housing facilities;
25	32		(iv) the ability of the individuals or
26	33		families who are members of the household to compete successfully
27	34		in the private housing market and to pay the amounts required by
28	35		that market for sanitary, decent, and safe housing; and
29	36		(v) standards that are established for the
30	37		purpose of federal programs and that use income to determine
31	38		eligibility for the programs; and
32	39		(B) does not qualify as a low income household.
33	40		SECTION 2. Section 379E.004(b), Local Government Code, is
34	41		amended to read as follows:
35	42		(b) The governing body of a municipality that adopts an
36	43		urban land bank program shall establish or approve a land bank to
37	44		exercise [for] the powers [purpose] of acquiring, holding,
38	45		developing, and transferring [unimproved] real property under this
39	46		chapter.
40	47		SECTION 3. Section 379E.005, Local Government Code, is
41	48		amended to read as follows:
42	49		Sec. 379E.005. QUALIFIED PARTICIPATING DEVELOPER. To
43	50		qualify to participate in an urban land bank program, a developer
44	51		other than the land bank must:
45	52		(1) have developed three or more housing units within
46	53		the three-year period preceding the submission of a proposal to the
47	54		land bank seeking to acquire real property from the land bank;
48	55		(2) have a development plan approved [by the
49	56		municipality] for the land bank property by the land bank or the
50	57		municipality; and
51	58		(3) meet any other requirements adopted by the
52	59		municipality in the urban land bank plan.
53	60		SECTION 4. Section 379E.006(c), Local Government Code, is
54	61		amended to read as follows:
55	62		(c) In developing the plan, the municipality shall consider
56	63		any other housing plans adopted by the municipality, including any
57	64		[the comprehensive plan submitted to the United States Department
58	65		of Housing and Urban Development and all] fair housing plans and
59	66		policies adopted or agreed to by the municipality.
60	67		SECTION 5. Section 379E.008(a), Local Government Code, is
61	68		amended to read as follows:
62	69		(a) Notwithstanding any other law and except as provided by
63	70		Subsection (f), property that is ordered sold pursuant to
64	71		foreclosure of a tax lien may be sold in a private sale to a land
65	72		bank by the officer charged with the sale of the property without
66	73		first offering the property for sale as otherwise provided by
67	74		Section 34.01, Tax Code, if:
68	75		(1) the market value of the property as specified in
69	76		the judgment of foreclosure is less than the total amount due under
70	77		the judgment, including all taxes, penalties, and interest, plus
71	78		the value of nontax liens held by a taxing unit and awarded by the
72	79		judgment, court costs, and the cost of the sale;
73	80		(2) the property is not improved with a habitable
74	81		building or buildings or an uninhabitable building or buildings
75	82		that are occupied as a residence by an owner or tenant who is
76	83		legally entitled to occupy the building or buildings;
77	84		(3) there are delinquent taxes on the property for a
78	85		total of at least five years; and
79	86		(4) the municipality has executed with the other
80	87		taxing units that are parties to the tax suit an interlocal
81	88		agreement that enables those units to agree to participate in the
82	89		program while retaining the right to withhold consent to the sale of
83	90		specific properties to the land bank.
84	91		SECTION 6. Section 379E.009, Local Government Code, is
85	92		amended to read as follows:
86	93		Sec. 379E.009. SUBSEQUENT RESALE OR DEVELOPMENT BY LAND
87	94		BANK. (a) Within the five-year period following the date [Each
88	95		subsequent resale] of acquisition of a property [acquired] by a
89	96		land bank, the land bank [under this chapter must comply with the
90	97		conditions of this section.
91	98		[(b) Within the three-year period following the date of
92	99		acquisition, the land bank] must:
93	100		(1) sell the [a] property to a qualified participating
94	101		developer for the purpose of construction or rehabilitation of
95	102		affordable housing for sale or rent to low or moderate income
96	103		households; or
97	104		(2) develop the property for the purposes described by
98	105		Subdivision (1).
99	106		(b) If after five [three] years a qualified participating
100	107		developer has not purchased the property or the land bank has not
101	108		developed the property, the property shall be transferred from the
102	109		land bank to the taxing units who were parties to the judgment for
103	110		disposition as otherwise allowed under the law.
104	111		(c) Unless the municipality increases the amount in its
105	112		plan, the number of properties acquired by a qualified
106	113		participating developer under this section on which development has
107	114		not been completed may not at any given time exceed three times the
108	115		annual average residential production completed by the qualified
109	116		participating developer during the preceding three-year [two-year]
110	117		period as determined by the municipality.
111	118		(d) The deed conveying a property sold by the land bank must
112	119		include a right of reverter so that, if the qualified participating
113	120		developer does not apply for a construction permit and close on any
114	121		construction financing within the three-year [two-year] period
115	122		following the date of the conveyance of the property from the land
116	123		bank to the qualified participating developer, the property will
117	124		revert to the land bank for development by the land bank, subsequent
118	125		resale to another qualified participating developer, or conveyance
119	126		to the taxing units who were parties to the judgment for disposition
120	127		as otherwise allowed under the law.
121	128		(e) Each subsequent resale that a land bank makes to a
122	129		qualified participating developer with respect to a property
123	130		acquired by the land bank under this chapter must comply with the
124	131		conditions of this section.
125	132		SECTION 7. Sections 379E.010(a), (b), (c), and (d), Local
126	133		Government Code, are amended to read as follows:
127	134		(a) The land bank shall impose deed restrictions on property
128	135		developed by the land bank or sold to qualified participating
129	136		developers requiring the development and subsequent sale or rental
130	137		of the property to low or moderate income households.
131	138		(b) For land bank properties developed by the land bank for
132	139		sale, and for [At least 25 percent of the] land bank properties sold
133	140		to a qualified participating developer for development for sale, in
134	141		[during] any given fiscal year:
135	142		(1) at least 45 percent of the properties must [to] be
136	143		deed restricted for sale [developed for sale shall be deed
137	144		restricted for sale] to households with a [gross] household income
138	145		of [incomes] not more [greater] than 80 [60] percent of the area
139	146		median family income, based on gross household income, adjusted for
140	147		household size, for the metropolitan statistical area in which the
141	148		properties are [municipality is] located, as determined annually by
142	149		the United States Department of Housing and Urban Development;
143	150		(2) at least 25 percent of the properties must be deed
144	151		restricted for sale to households with a household income of not
145	152		more than 60 percent of the area median family income, based on
146	153		gross household income, adjusted for household size, for the
147	154		metropolitan statistical area in which the properties are located,
148	155		as determined annually by the United States Department of Housing
149	156		and Urban Development; and
150	157		(3) the remaining properties must be deed restricted
151	158		for sale to households with a household income of not more than 120
152	159		percent of the area median family income, based on gross household
153	160		income, adjusted for household size, for the metropolitan
154	161		statistical area in which the properties are located, as determined
155	162		annually by the United States Department of Housing and Urban
156	163		Development.
157	164		(c) If property is developed and used for rental housing,
158	165		the deed restrictions must be for a period of not less than 30 [20]
159	166		years and must require that 100 percent of the units are occupied by
160	167		and affordable to households with incomes not greater than 80
161	168		percent of area median family income, based on gross household
162	169		income, adjusted for household size, for the metropolitan
163	170		statistical area in which the units are located, as determined
164	171		annually by the United States Department of Housing and Urban
165	172		Development, and must also require that of those units:
166	173		(1) at least 40 [100] percent are [of the rental units
167	174		be] occupied by and affordable to households with incomes not
168	175		greater than 60 percent of area median family income, based on gross
169	176		household income, adjusted for household size, for the metropolitan
170	177		statistical area in which the units are [municipality is] located,
171	178		as determined annually by the United States Department of Housing
172	179		and Urban Development; and
173	180		(2) at least 20 [40] percent are [of the units be]
174	181		occupied by and affordable to households with incomes not greater
175	182		than 50 percent of area median family income, based on gross
176	183		household income, adjusted for household size, for the metropolitan
177	184		statistical area in which the units are [municipality is] located,
178	185		as determined annually by the United States Department of Housing
179	186		and Urban Development[; or
180	187		[(3) 20 percent of the units be occupied by and
181	188		affordable to households with incomes not greater than 30 percent
182	189		of area median family income, based on gross household income,
183	190		adjusted for household size, for the metropolitan statistical area
184	191		in which the municipality is located, as determined annually by the
185	192		United States Department of Housing and Urban Development].
186	193		(d) The deed restrictions under Subsection (c) must require
187	194		the owner to file an annual occupancy report with the municipality
188	195		on a reporting form provided by or acceptable to the
189	196		municipality. The deed restrictions must also prohibit any
190	197		exclusion of an individual or family from admission to the
191	198		development based solely on the participation of the individual or
192	199		family in the housing choice voucher program under Section 8,
193	200		United States Housing Act of 1937 (42 U.S.C. Section 1437f), as
194	201		amended.
195	202		SECTION 8. Sections 379E.013(c) and (d), Local Government
196	203		Code, are amended to read as follows:
197	204		(c) For purposes of evaluating the effectiveness of the
198	205		program, the land bank shall submit an annual performance report to
199	206		the municipality not later than November 1 of each year in which the
200		-	land bank acquires, develops, or sells property under this ~~chapter.~~
201		-	The performance report must include:
	207	+	land bank acquires, develops, or sells property under this
	208	+	chapter. The performance report must include:
202	209		(1) a complete and detailed written accounting of all
203	210		money and properties received and disbursed by the land bank during
204	211		the preceding fiscal year;
205	212		(2) for each property acquired by the land bank during
206	213		the preceding fiscal year:
207	214		(A) the street address of the property;
208	215		(B) the legal description of the property;
209	216		(C) the date the land bank took title to the
210	217		property;
211	218		(D) the name and mailing address of the property
212	219		owner of record at the time of the foreclosure;
213	220		(E) the amount of taxes and other costs owed at
214	221		the time of the foreclosure; and
215	222		(F) the assessed value of the property on the tax
216	223		roll at the time of the foreclosure;
217	224		(3) for each property sold by the land bank during the
218	225		preceding fiscal year to a qualified participating developer:
219	226		(A) the street address of the property;
220	227		(B) the legal description of the property;
221	228		(C) the name and mailing address of the purchaser
222	229		[developer];
223	230		(D) the [purchase] price paid by the purchaser
224	231		[developer];
225	232		(E) the maximum incomes allowed for the
226	233		households by the terms of the sale; and
227	234		(F) the source and amount of any public subsidy
228	235		provided by the municipality to facilitate the sale or rental of the
229	236		property to a household within the targeted income levels;
230	237		(4) for each property sold by the land bank or a
231	238		qualified participating developer during the preceding fiscal
232	239		year, the buyer's household income and a description of all use and
233	240		sale restrictions; and
234	241		(5) for each property developed for rental housing
235	242		with an active deed restriction, a copy of the most recent annual
236	243		report for [filed by] the property [owner with the land bank].
237	244		(d) The land bank shall maintain in its records for
238	245		inspection a copy of the sale settlement statement for each
239	246		property sold by the land bank or a qualified participating
240	247		developer and a copy of the first page of the mortgage note with the
241	248		interest rate and indicating the volume and page number of the
242	249		instrument as filed with the county clerk.
243	250		SECTION 9. Section 11.18(d), Tax Code, is amended to read as
244	251		follows:
245	252		(d) A charitable organization must be organized exclusively
246	253		to perform religious, charitable, scientific, literary, or
247	254		educational purposes and, except as permitted by Subsections (h)
248	255		and (l), engage exclusively in performing one or more of the
249	256		following charitable functions:
250	257		(1) providing medical care without regard to the
251	258		beneficiaries' ability to pay, which in the case of a nonprofit
252	259		hospital or hospital system means providing charity care and
253	260		community benefits in accordance with Section 11.1801;
254	261		(2) providing support or relief to orphans,
255	262		delinquent, dependent, or handicapped children in need of
256	263		residential care, abused or battered spouses or children in need of
257	264		temporary shelter, the impoverished, or victims of natural disaster
258	265		without regard to the beneficiaries' ability to pay;
259	266		(3) providing support without regard to the
260	267		beneficiaries' ability to pay to:
261	268		(A) elderly persons, including the provision of:
262	269		(i) recreational or social activities; and
263	270		(ii) facilities designed to address the
264	271		special needs of elderly persons; or
265	272		(B) the handicapped, including training and
266	273		employment:
267	274		(i) in the production of commodities; or
268	275		(ii) in the provision of services under 41
269	276		U.S.C. Sections 8501-8506;
270	277		(4) preserving a historical landmark or site;
271	278		(5) promoting or operating a museum, zoo, library,
272	279		theater of the dramatic or performing arts, or symphony orchestra
273	280		or choir;
274	281		(6) promoting or providing humane treatment of
275	282		animals;
276	283		(7) acquiring, storing, transporting, selling, or
277	284		distributing water for public use;
278	285		(8) answering fire alarms and extinguishing fires with
279	286		no compensation or only nominal compensation to the members of the
280	287		organization;
281	288		(9) promoting the athletic development of boys or
282	289		girls under the age of 18 years;
283	290		(10) preserving or conserving wildlife;
284	291		(11) promoting educational development through loans
285	292		or scholarships to students;
286	293		(12) providing halfway house services pursuant to a
287	294		certification as a halfway house by the parole division of the Texas
288	295		Department of Criminal Justice;
289	296		(13) providing permanent housing and related social,
290	297		health care, and educational facilities for persons who are 62
291	298		years of age or older without regard to the residents' ability to
292	299		pay;
293	300		(14) promoting or operating an art gallery, museum, or
294	301		collection, in a permanent location or on tour, that is open to the
295	302		public;
296	303		(15) providing for the organized solicitation and
297	304		collection for distributions through gifts, grants, and agreements
298	305		to nonprofit charitable, education, religious, and youth
299	306		organizations that provide direct human, health, and welfare
300	307		services;
301	308		(16) performing biomedical or scientific research or
302	309		biomedical or scientific education for the benefit of the public;
303	310		(17) operating a television station that produces or
304	311		broadcasts educational, cultural, or other public interest
305	312		programming and that receives grants from the Corporation for
306	313		Public Broadcasting under 47 U.S.C. Section 396, as amended;
307	314		(18) providing housing for low-income and
308	315		moderate-income families, for unmarried individuals 62 years of age
309	316		or older, for handicapped individuals, and for families displaced
310	317		by urban renewal, through the use of trust assets that are
311	318		irrevocably and, pursuant to a contract entered into before
312	319		December 31, 1972, contractually dedicated on the sale or
313	320		disposition of the housing to a charitable organization that
314	321		performs charitable functions described by Subdivision (9);
315	322		(19) providing housing and related services to persons
316	323		who are 62 years of age or older in a retirement community, if the
317	324		retirement community provides independent living services,
318	325		assisted living services, and nursing services to its residents on
319	326		a single campus:
320	327		(A) without regard to the residents' ability to
321	328		pay; or
322	329		(B) in which at least four percent of the
323	330		retirement community's combined net resident revenue is provided in
324	331		charitable care to its residents;
325	332		(20) providing housing on a cooperative basis to
326	333		students of an institution of higher education if:
327	334		(A) the organization is exempt from federal
328	335		income taxation under Section 501(a), Internal Revenue Code of
329	336		1986, as amended, by being listed as an exempt entity under Section
330	337		501(c)(3) of that code;
331	338		(B) membership in the organization is open to all
332	339		students enrolled in the institution and is not limited to those
333	340		chosen by current members of the organization;
334	341		(C) the organization is governed by its members;
335	342		and
336	343		(D) the members of the organization share the
337	344		responsibility for managing the housing;
338	345		(21) acquiring, holding, and transferring unimproved
339	346		real property under an urban land bank demonstration program
340	347		established under Chapter 379C, Local Government Code, as or on
341	348		behalf of a land bank;
342	349		(22) acquiring, holding, and transferring
343	350		[unimproved] real property under an urban land bank program
344	351		established under Chapter 379E, Local Government Code, as or on
345	352		behalf of a land bank;
346	353		(23) providing housing and related services to
347	354		individuals who:
348	355		(A) are unaccompanied and homeless and have a
349	356		disabling condition; and
350	357		(B) have been continuously homeless for a year or
351	358		more or have had at least four episodes of homelessness in the
352	359		preceding three years;
353	360		(24) operating a radio station that broadcasts
354	361		educational, cultural, or other public interest programming,
355	362		including classical music, and that in the preceding five years has
356	363		received or been selected to receive one or more grants from the
357	364		Corporation for Public Broadcasting under 47 U.S.C. Section 396, as
358	365		amended; or
359	366		(25) providing, without regard to the beneficiaries'
360	367		ability to pay, tax return preparation services and assistance with
361	368		other financial matters.
362	369		SECTION 10. The changes in law made by this Act to Chapter
363	370		379E, Local Government Code, apply only to a property acquired by a
364	371		land bank on or after the effective date of this Act. A property
365	372		acquired by a land bank before the effective date of this Act is
366	373		governed by the law in effect immediately before the effective date
367	374		of this Act, and the former law is continued in effect for that
368	375		purpose.
369	376		SECTION 11. Section 11.18, Tax Code, as amended by this Act,
370	377		applies only to an ad valorem tax year that begins on or after the
371	378		effective date of this Act.
372	379		SECTION 12. This Act takes effect September 1, 2019.
	380	+	* * * * *