Texas 2021 - 87th Regular

Texas Senate Bill SB591 Compare Versions

Version 1 (Old)

Version 2 (New)

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1	1		By: Bettencourt S.B. No. 591
2		-	(Murphy)
3	2
4	3
5	4		A BILL TO BE ENTITLED
6	5		AN ACT
7	6		relating to certain public facilities used to provide affordable
8	7		housing.
9	8		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	9		SECTION 1. Section 303.021, Local Government Code, is
11	10		amended by adding Subsection (c) to read as follows:
12	11		(c) A corporation or a sponsor may finance, own, or operate
13	12		a multifamily residential development if the corporation or sponsor
14	13		complies with all applicable provisions of this chapter.
15	14		SECTION 2. Section 303.042, Local Government Code, is
16	15		amended by amending Subsections (d) and (f) and adding Subsections
17	16		(d-1) and (d-2) to read as follows:
18	17		(d) This subsection applies only to a multifamily
19	18		residential development that is owned by a corporation created
20	19		under this chapter by a housing authority and that does not have at
21	20		least 20 percent of its units reserved for public housing units,
22	21		participate in the Rental Assistance Demonstration program
23	22		administered by the United States Department of Housing and Urban
24	23		Development, or receive financial assistance administered under
25	24		Chapter 1372, Government Code, or Subchapter DD, Chapter 2306,
26	25		Government Code. Notwithstanding Subsections (a) and (b), an [An]
27	26		exemption under this section for a multifamily residential
28	27		development [which is owned by a public facility corporation
29	28		created by a housing authority under this chapter and which does not
30	29		have at least 20 percent of its units reserved for public housing
31	30		units,] applies only if:
32	31		(1) the housing authority holds a public hearing, at a
33	32		[regular] meeting of the authority's governing body, to approve the
34	33		development; [and]
35	34		(2) at least 50 percent of the units in the multifamily
36	35		residential development are reserved for occupancy by individuals
37	36		and families earning less than 80 percent of the area median
38	37		[family] income;
39	38		(3) the requirements under Sections 303.0425 and
40	39		303.0426 are met; and
41	40		(4) for an occupied multifamily residential
42	41		development that is acquired by a corporation:
43	42		(A) the governing body of each municipality or
44	43		county for which the sponsor of the corporation was created
45	44		approves a resolution of "no objection" for the development; and
46	45		(B) a sum of not less than 50 percent of the total
47	46		gross cost of the existing project in its entirety is expended on
48	47		rehabilitating, renovating, reconstructing, or repairing the
49	48		project.
50	49		(d-1) This subsection applies only to a multifamily
51	50		residential development that is owned by a corporation created
52	51		under this chapter by a sponsor other than a housing authority and
53	52		that does not have at least 20 percent of its units reserved for
54	53		public housing units, participate in the Rental Assistance
55	54		Demonstration program administered by the United States Department
56	55		of Housing and Urban Development, or receive financial assistance
57	56		administered under Chapter 1372, Government Code, or Subchapter DD,
58	57		Chapter 2306, Government Code. Notwithstanding Subsections (a) and
59	58		(b), an exemption under this section for a multifamily residential
60	59		development applies only if:
61	60		(1) at least 50 percent of the units in the multifamily
62	61		residential development are reserved for occupancy by individuals
63	62		and families earning less than 80 percent of the area median income;
64	63		and
65	64		(2) the requirements under Section 303.0426 are met.
66	65		(d-2) This subsection applies to a multifamily residential
67	66		development that is owned by a corporation created by any sponsor
68	67		under this chapter. Notwithstanding Subsections (a), (b), (d), and
69	68		(d-1), an exemption under this section for an occupied multifamily
70	69		residential development that is acquired by the corporation applies
71	70		only if the development comes into compliance with the requirements
72	71		of Subsection (d) or (d-1), as applicable, not later than the first
73	72		anniversary of the date of the acquisition.
74	73		(f) Notwithstanding Subsections (a) and (b), during
75	74		the period [of time] that a corporation owns a particular public
76	75		facility that provides multifamily housing:
77	76		(1) [,] a leasehold or other possessory interest in
78	77		the real property of the public facility granted by the corporation
79	78		shall be treated in the same manner as a leasehold or other
80	79		possessory interest in real property granted by an authority under
81	80		Section 379B.011(b); and
82	81		(2) the materials used by a person granted a
83	82		possessory interest described by Subdivision (1) to improve the
84	83		real property of the public facility shall be exempt from all sales
85	84		and use taxes because the materials are for the benefit of the
86	85		corporation.
87	86		SECTION 3. Subchapter B, Chapter 303, Local Government
88	87		Code, is amended by adding Sections 303.0425 and 303.0426 to read as
89	88		follows:
90	89		Sec. 303.0425. ADDITIONAL REQUIREMENTS FOR BENEFICIAL TAX
91	90		TREATMENT RELATING TO CERTAIN PUBLIC FACILITIES OWNED BY
92	91		CORPORATIONS CREATED BY HOUSING AUTHORITIES. (a) In this section:
93	92		(1) "Developer" means a private entity that constructs
94	93		a development.
95	94		(2) "Housing choice voucher program" means the housing
96	95		choice voucher program under Section 8, United States Housing Act
97	96		of 1937 (42 U.S.C. Section 1437f).
98	97		(3) "Lower income housing unit" means a residential
99	98		unit reserved for occupancy by an individual or family earning not
100	99		more than 60 percent of the area median income, adjusted for family
101	100		size.
102	101		(4) "Public facility user" means a public-private
103	102		partnership entity or a developer or other private entity that has
104	103		an ownership interest or a leasehold or other possessory interest
105	104		in a public facility used to provide multifamily housing.
106	105		(b) The requirements prescribed by this section do not apply
107	106		to a multifamily residential development that is:
108	107		(1) owned by a corporation that was not created by a
109	108		housing authority; or
110	109		(2) owned by a corporation created by a housing
111	110		authority and:
112	111		(A) in which at least 20 percent of the units are
113	112		reserved for public housing units;
114	113		(B) that participates in the Rental Assistance
115	114		Demonstration program administered by the United States Department
116	115		of Housing and Urban Development; or
117	116		(C) that receives financial assistance
118	117		administered under Chapter 1372, Government Code, or Subchapter DD,
119	118		Chapter 2306, Government Code.
120	119		(c) A corporation must use an open, transparent, and
121	120		competitive process for selecting a developer for the purpose of
122	121		constructing a housing development.
123	122		(d) At least 10 percent of the units in the development must
124	123		be reserved as lower income housing units. A unit may not be used to
125	124		satisfy the reservation required under this subsection if every
126	125		tenant in the unit is:
127	126		(1) a part-time or full-time student at an institution
128	127		of higher education;
129	128		(2) under the age of 24; and
130	129		(3) ineligible for housing assistance under Section 8,
131	130		United States Housing Act of 1937 (42 U.S.C. Section 1437f).
132	131		(e) The percentage of lower income housing units reserved in
133	132		each category of units in the housing development, based on the
134	133		number of bedrooms and bathrooms per unit, must be the same as the
135	134		percentage of lower income housing units reserved in the housing
136	135		development as a whole.
137	136		(f) The monthly rent charged for a lower income housing unit
138	137		may not exceed:
139	138		(1) 30 percent of 60 percent of the area median income,
140	139		adjusted for family size; or
141	140		(2) if the unit is occupied by a participant in the
142	141		housing choice voucher program, the payment standard used by the
143	142		housing authority that administers the voucher for the unit.
144	143		(g) In calculating the income of an individual or family for
145	144		a lower income housing unit, the public facility user must consider
146	145		the income of every individual who will be living in the unit.
147	146		Sec. 303.0426. ADDITIONAL REQUIREMENTS FOR BENEFICIAL TAX
148	147		TREATMENT RELATING TO CERTAIN PUBLIC FACILITIES OWNED BY
149	148		CORPORATIONS CREATED BY ANY SPONSOR. (a) In this section, "housing
150	149		choice voucher program," "lower income housing unit," and "public
151	150		facility user" have the meanings assigned by Section 303.0425.
152	151		(b) The requirements prescribed by this section do not apply
153	152		to a multifamily residential development owned by a corporation:
154	153		(1) in which at least 20 percent of the units are
155	154		reserved for public housing units;
156	155		(2) that participates in the Rental Assistance
157	156		Demonstration program administered by the United States Department
158	157		of Housing and Urban Development; or
159	158		(3) that receives financial assistance administered
160	159		under Chapter 1372, Government Code, or Subchapter DD, Chapter
161	160		2306, Government Code.
162	161		(c) A public facility user may not:
163	162		(1) refuse to rent a residential unit to an individual
164	163		or family because the individual or family participates in the
165	164		housing choice voucher program; or
166	165		(2) use a financial or minimum income standard that
167	166		requires an individual or family participating in the housing
168	167		choice voucher program to have a monthly income of more than 250
169	168		percent of the individual's or family's share of the total monthly
170	169		rent payable for a unit.
171	170		(d) A corporation that owns or leases to a public facility
172	171		user a public facility used as a multifamily residential
173	172		development shall publish on its Internet website information about
174	173		the development's:
175	174		(1) compliance with the requirements of this section;
176	175		and
177	176		(2) policies regarding tenant participation in the
178	177		housing choice voucher program.
179	178		(e) A public facility user shall:
180	179		(1) affirmatively market available residential units
181	180		directly to individuals and families participating in the housing
182	181		choice voucher program; and
183	182		(2) notify local housing authorities of any available
184	183		units in the development.
185	184		(f) Not later than April 1 of each year, a public facility
186	185		user of a multifamily residential development must:
187	186		(1) submit to the chief appraiser of the appraisal
188	187		district in which the development is located an audit report for a
189	188		compliance audit conducted by an independent auditor or compliance
190	189		expert to determine whether the public facility user is in
191	190		compliance with the requirements of this section; and
192	191		(2) submit to the comptroller a report that includes,
193	192		for each housing development:
194	193		(A) the name of the development;
195	194		(B) the street address and municipality or county
196	195		in which the development is located;
197	196		(C) the name of the developer;
198	197		(D) the total number of residential units,
199	198		reported by bedroom size;
200	199		(E) the total number of lower income housing
201	200		units, reported by bedroom size, level of income restriction, and
202	201		rent;
203	202		(F) the total number of residential units,
204	203		reported by bedroom size, level of income restriction, and rent,
205	204		that are not lower income housing units but that are reserved for
206	205		occupancy by an individual or family earning less than 80 percent of
207	206		the area median income;
208	207		(G) the number of residential units rented by
209	208		individuals and families who participate in the housing choice
210	209		voucher program, reported by bedroom size;
211	210		(H) the race, ethnicity, and age of all
212	211		occupants, if available; and
213	212		(I) if not previously submitted in a report to
214	213		the comptroller, or if amended since the previous submission:
215	214		(i) a copy of the ground lease; and
216	215		(ii) a copy of the partnership agreement
217	216		for the public facility.
218	217		(g) The reports submitted under Subsection (f) are public
219	218		information and subject to disclosure under Chapter 552, Government
220	219		Code, except that information containing tenant names, unit
221	220		numbers, or other identifying information may be redacted. The
222	221		comptroller shall post a copy of the report received under
223	222		Subsection (f)(2) on its Internet website.
224	223		(h) Each lease agreement for a unit in a multifamily
225	224		residential development subject to this section must provide that:
226	225		(1) the landlord may not retaliate against the tenant
227	226		or the tenant's guests by taking an action because the tenant
228	227		established, attempted to establish, or participated in a tenant
229	228		organization;
230	229		(2) the landlord may only choose to not renew the lease
231	230		if the tenant:
232	231		(A) is in material noncompliance with the lease,
233	232		including nonpayment of rent after the required cure period;
234	233		(B) committed one or more substantial violations
235	234		of the lease;
236	235		(C) failed to provide required information on the
237	236		income, composition, or eligibility of the tenant's household; or
238	237		(D) committed repeated minor violations of the
239	238		lease that:
240	239		(i) disrupt the livability of the property;
241	240		(ii) adversely affect the health and safety
242	241		of any person or the right to quiet enjoyment of the leased premises
243	242		and related project facilities;
244	243		(iii) interfere with the management of the
245	244		project; or
246	245		(iv) have an adverse financial effect on
247	246		the project, including the repeated failure of the tenant to pay
248	247		rent in a timely manner;
249	248		(3) to not renew the lease, the landlord must serve a
250	249		written notice of proposed nonrenewal on the tenant at least 30 days
251	250		before the effective date of nonrenewal; and
252	251		(4) any written notice of a proposed nonrenewal that
253	252		is required to be provided under Subdivision (3) must specify the
254	253		date of the proposed nonrenewal.
255	254		(i) A tenant may not waive the protections provided by
256	255		Subsection (h).
257	256		(j) A public facility corporation must be given:
258	257		(1) written notice of an instance of noncompliance
259	258		with this section; and
260	259		(2) 90 days after the day notice is received under
261	260		Subdivision (1) to cure the matter that is the subject of the
262	261		notice.
263	262		(k) Notwithstanding any other law, an occupied multifamily
264	263		residential development that is acquired by a public facility
265	264		corporation is eligible for an exemption under Section 303.042(d-2)
266	265		for the one-year period following the date of the acquisition
267	266		regardless of whether the development complies with the other
268	267		requirements of that section or with this section, as applicable.
269	268		SECTION 4. Section 392.005(c), Local Government Code, is
270	269		amended to read as follows:
271	270		(c) An exemption under this section for a multifamily
272	271		residential development which is owned by [(i) a public facility
273	272		corporation created by a housing authority under Chapter 303, (ii)]
274	273		a housing development corporation[,] or [(iii)] a similar entity
275	274		created by a housing authority, other than a public facility
276	275		corporation created by a housing authority under Chapter 303, and
277	276		which does not have at least 20 percent of its units reserved for
278	277		public housing units, applies only if:
279	278		(1) the authority holds a public hearing, at a regular
280	279		meeting of the authority's governing body, to approve the
281	280		development; and
282	281		(2) at least 50 percent of the units in the multifamily
283	282		residential development are reserved for occupancy by individuals
284	283		and families earning less than 80 percent of the area median family
285	284		income.
286	285		SECTION 5. (a) Section 303.042(d), Local Government Code,
287	286		as amended by this Act, applies only to a multifamily residential
288	287		development that is approved by a housing authority on or after the
289	288		effective date of this Act. A multifamily residential development
290	289		that is approved by a housing authority before the effective date of
291	290		this Act is governed by the law in effect on the date the
292	291		development was approved by the housing authority, and the former
293	292		law is continued in effect for that purpose.
294	293		(b) Section 303.042(d-1), Local Government Code, as added
295	294		by this Act, applies only to a multifamily residential development
296	295		that is approved by a public facility corporation on or after the
297	296		effective date of this Act. A multifamily residential development
298	297		that is approved by a public facility corporation before the
299	298		effective date of this Act is governed by the law in effect on the
300	299		date the development was approved by the public facility
301	300		corporation, and the former law is continued in effect for that
302	301		purpose.
303	302		(c) Section 303.042(d-2), Local Government Code, as added
304	303		by this Act, applies only to a multifamily residential development
305	304		that is acquired by a public facility corporation on or after the
306	305		effective date of this Act. A multifamily residential development
307	306		that is acquired by a public facility corporation before the
308	307		effective date of this Act is governed by the law in effect on the
309	308		date the development was acquired by the public facility
310	309		corporation, and the former law is continued in effect for that
311	310		purpose.
312	311		SECTION 6. This Act takes effect September 1, 2021.