89R5092 JAM-D
By: Johnson S.B. No. 234
A BILL TO BE ENTITLED
AN ACT
relating to the establishment of the workforce housing program by
the Texas Department of Housing and Community Affairs.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter K, Chapter 2306, Government Code, is
amended by adding Section 2306.2595 to read as follows:
Sec. 2306.2595. WORKFORCE HOUSING PROGRAM. (a) In this
section:
(1) "Fund" means the workforce housing fund.
(2) "Mezzanine real estate loan" has the meaning
assigned by Section 425.1185, Insurance Code.
(3) "Program" means the workforce housing program.
(b) The department shall establish the workforce housing
program to provide financial assistance to developers of
multifamily housing to facilitate the construction and
rehabilitation of eligible workforce housing developments in this
state. Financial assistance may be awarded for the purposes
described by this section from the fund described by Subsection (f)
to developers in the form of low-interest loans offered below
market rate, which:
(1) must be structured as mezzanine real estate loans;
and
(2) may not exceed 20 percent of the initial
construction or rehabilitation costs of the eligible development.
(c) To be eligible for the financial assistance received by
a developer under the program, a workforce housing development:
(1) must consist of new construction or a substantial
rehabilitation of an existing facility;
(2) must reserve a specified percentage of the units
in the development for occupancy of individuals and families
earning:
(A) not more than 50 percent of the area median
income, adjusted for family size;
(B) not more than 60 percent of the area median
income, adjusted for family size;
(C) not more than 80 percent of the area median
income, adjusted for family size;
(D) not more than 100 percent of the area median
income, adjusted for family size; and
(E) not more than 120 percent of the area median
income, adjusted for family size;
(3) for an income-restricted unit, may not charge rent
in an amount that exceeds 30 percent of the monthly income
restriction applicable to that unit under Subdivision (2); and
(4) must maintain the affordability requirements
described by Subdivisions (2) and (3) for a period of not less than
20 years following the date of receipt of financial assistance
under this section.
(d) The department shall adopt rules to implement the
program, including rules that:
(1) provide criteria for determining which developers
and workforce housing developments may participate in the program;
(2) specify the percentage of units that a development
must reserve to satisfy the affordability requirements under
Subsection (c)(2), to demonstrate eligibility for financial
assistance awarded to developers under the program; and
(3) provide a scoring system to prioritize the
developments for which developers may use financial assistance
under the program.
(e) The scoring system established under Subsection (d)(3)
must give priority to workforce housing developments that reserve a
greater number of units for lower area median incomes and must award
higher value loans to developers for eligible developments in
proportion to the affordability of the developments.
(f) The workforce housing fund is a special account in the
state treasury. The fund consists of:
(1) money appropriated to the board for a purpose of
the fund;
(2) repayment of principal and interest from loans
made from the fund;
(3) money the board transfers to the fund from any
available source;
(4) depository interest allocable to the fund and
other investment returns on money in the fund;
(5) money from gifts, grants, or donations to the
fund; and
(6) any other fees or sources of revenue that the
legislature may dedicate for deposit to the fund.
(g) Financial assistance provided from the fund to a
developer for an eligible workforce housing development must be
spent by the recipient on the development not later than 36 months
after the date the assistance is received.
(h) Money provided from the fund that is not spent as
required by Subsection (g) must be returned to the department and
deposited to the credit of the fund.
SECTION 2. This Act takes effect September 1, 2025.