89R3702 JAM-F
By: Gervin-Hawkins H.B. No. 1342
A BILL TO BE ENTITLED
AN ACT
relating to the issuance of private activity bonds for qualified
residential rental projects.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 1372.0321, Government Code, is amended
by adding Subsections (a-1) and (a-2) and amending Subsections (b),
(c), and (d) to read as follows:
(a-1) In granting reservations to issuers of qualified
residential rental project issues, the board shall give second
priority to projects:
(1) for which an application:
(A) was filed on or before October 20 of the
program year occurring two years before the current program year;
and
(B) was not withdrawn and did not receive a bond
reservation;
(2) that meet at least one requirement of Subsection
(b); and
(3) for which:
(A) a binding contract to incur significant
expenditures for construction, reconstruction, or rehabilitation
was entered into before submission of the application;
(B) significant expenditures for construction,
reconstruction, or rehabilitation were readily identifiable with
and necessary to carry out a binding contract for the supply of
property or services or the sale of output; or
(C) significant expenditures were paid or
incurred before submission of the application.
(a-2) For purposes of Subsection (a-1), "significant
expenditures" means expenditures that exceed the lesser of:
(1) $500,000; or
(2) 10 percent of the reasonably anticipated cost of
the project.
(b) In granting reservations to issuers of qualified
residential rental project issues, the board shall give third
[second] priority to:
(1) projects in which:
(A) 50 percent of the residential units in the
project are:
(i) under the restriction that the maximum
allowable rents are an amount equal to 30 percent of 50 percent of
the area median family income minus an allowance for utility costs
authorized under the federal low-income housing tax credit program;
and
(ii) reserved for families and individuals
earning not more than 50 percent of the area median income; and
(B) the remaining 50 percent of the residential
units in the project are:
(i) under the restriction that the maximum
allowable rents are an amount equal to 30 percent of 80 [60] percent
of the area median family income minus an allowance for utility
costs authorized under the federal low-income housing tax credit
program; and
(ii) reserved for families and individuals
earning not more than 80 [60] percent of the area median income;
(2) projects in which:
(A) 15 percent of the residential units in the
project are:
(i) under the restriction that the maximum
allowable rents are an amount equal to 30 percent of 30 percent of
the area median family income minus an allowance for utility costs
authorized under the federal low-income housing tax credit program;
and
(ii) reserved for families and individuals
earning not more than 30 percent of the area median income; and
(B) the remaining 85 percent of the residential
units in the project are:
(i) under the restriction that the maximum
allowable rents are an amount equal to 30 percent of 80 [60] percent
of the area median family income minus an allowance for utility
costs authorized under the federal low-income housing tax credit
program; and
(ii) reserved for families and individuals
earning not more than 80 [60] percent of the area median income;
(3) projects:
(A) in which 100 percent of the residential units
in the project are:
(i) under the restriction that the maximum
allowable rents are, on average, an amount equal to 30 percent of 60
percent of the area median family income minus an allowance for
utility costs authorized under the federal low-income housing tax
credit program; and
(ii) reserved for families and individuals
earning, on average, not more than 60 percent of the area median
income; and
(B) which are located in a census tract in which
the median income, based on the most recent information published
by the United States Bureau of the Census, is higher than the median
income for the county, metropolitan statistical area, or primary
metropolitan statistical area in which the census tract is located
as established by the United States Department of Housing and Urban
Development; or
(4) on or after June 1, projects that are located in
counties, metropolitan statistical areas, or primary metropolitan
statistical areas with area median family incomes at or below the
statewide median family income established by the United States
Department of Housing and Urban Development.
(c) In granting reservations to issuers of qualified
residential rental project issues, the board shall give fourth
[third] priority to projects in which 80 percent or more of the
residential units in the project are:
(1) under the restriction that the maximum allowable
rents are, on average, an amount equal to 30 percent of 60 percent
of the area median family income minus an allowance for utility
costs authorized under the federal low-income housing tax credit
program; and
(2) reserved for families and individuals earning, on
average, not more than 60 percent of the area median income.
(d) In granting reservations to issuers of qualified
residential rental project issues, the board shall give fifth
[fourth] priority to any other qualified residential rental
project.
SECTION 2. Section 1372.042(d), Government Code, is amended
to read as follows:
(d) Not later than the fifth business day after the date on
which the bonds are closed, the issuer shall submit to the board:
(1) a written notice stating the delivery date of the
bonds and the principal amount of the bonds issued; and
(2) [if the project is a project entitled to first,
second, or third priority under Section 1372.0321, evidence from
the Texas Department of Housing and Community Affairs that an award
of low-income housing tax credits has been approved for the
project; and
[(3)] a certified copy of the document authorizing the
bonds and any other document relating to the issuance of the bonds,
including a statement of the bonds':
(A) principal amount;
(B) interest rate or formula by which the
interest rate is computed;
(C) maturity schedule; and
(D) purchaser or purchasers.
SECTION 3. Section 1372.0321(e), Government Code, is
repealed.
SECTION 4. The change in law made by this Act in amending
Chapter 1372, Government Code, applies to the allocation of the
available state ceiling under Chapter 1372 beginning with the 2026
program year.
SECTION 5. This Act takes effect September 1, 2025.