HB1595 - Relating to public housing authorities; authorizing a fee.

  89R2681 JAM-F     By: Gates H.B. No. 1595       A BILL TO BE ENTITLED   AN ACT   relating to public housing authorities; authorizing a fee.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subchapter A, Chapter 392, Local Government   Code, is amended by amending Section 392.005 and adding Sections   392.0051 and 392.0052 to read as follows:          Sec. 392.005.  TAX EXEMPTION. (a) The property of an   authority is public property used for essential public and   governmental purposes. Subject to Section 392.0051, the [ The ]   authority and the authority's property are exempt from all taxes   and special assessments of a municipality, a county, another   political subdivision, or the state.          (b)  If a municipality, county, or political subdivision   furnishes improvements, services, or facilities for a housing   project, an authority may, in lieu of paying taxes or special   assessments, agree to reimburse in payments to the municipality,   county, or political subdivision an amount not greater than the   estimated cost to the municipality, county, or political   subdivision for the improvements, services, or facilities.           Sec.   392.0051.     CONDITIONS FOR BENEFICIAL PROPERTY-BASED   TAX AND SPECIAL ASSESSMENT TREATMENT RELATING TO CERTAIN   MULTIFAMILY RESIDENTIAL DEVELOPMENTS. (a) In this section:                 (1)     "Housing choice voucher program" means the housing   choice voucher program under Section 8, United States Housing Act   of 1937 (42 U.S.C. Section 1437f).                 (2)     "Lower income housing unit" means a residential   unit reserved for occupancy by an individual or family earning not   more than 60 percent of the area median income, adjusted for family   size, as defined by the United States Department of Housing and   Urban Development.                 (3)     "Moderate income housing unit" means a residential   unit reserved for occupancy by an individual or family earning not   more than 80 percent of the area median income, adjusted for family   size, as defined by the United States Department of Housing and   Urban Development.                 (4)     "Property-based exemption"   means an exemption   from the taxes and special assessments imposed with respect to   property owned by an authority.                 (5)     "Public housing unit" means a residential unit for   which the landlord receives a public housing operating subsidy.   The term does not include a unit for which payments are made to the   landlord under the housing choice voucher program.                 (6)     "Rent" means any recurring fee or charge a tenant   is required to pay as a condition of occupancy, including a fee or   charge for the use of a common area or facility reasonably   associated with residential rental property.           (b)  This section applies to [ (c)     An exemption under this   section for ] a multifamily residential development which is owned   by an authority, a housing development corporation or a similar   entity created by a housing authority, and [ other than ] a public   facility corporation created by a housing authority under Chapter   303, except that this section does not apply to a multifamily   residential development that [ and which does not have at least 20   percent of its residential units reserved for public housing units,   applies only if ]:                (1)  [ the authority holds a public hearing, at a   regular meeting of the authority's governing body, to approve the   development; and                [ (2)     at least 50 percent of the units in the   multifamily residential development are reserved for occupancy by   individuals and families earning less than 80 percent of the area   median income, adjusted for family size.          [ (c-1)     An exemption under this section for a multifamily   residential development which is owned by a public facility   corporation created by a housing authority under Chapter 303   applies only if:                [ (1)     at least 50 percent of units in the multifamily   residential development are reserved for occupancy by individuals   and families earning not more than 80 percent of the area median   income, adjusted for family size; and                [ (2)  the development:                      [ (A) ]  has at least 20 percent of its residential   units reserved for public housing units;                 (2)  [ (B) ]  participates in the Rental Assistance   Demonstration program administered by the United States Department   of Housing and Urban Development; or                 (3)  [ (C)     receives financial assistance administered   under Chapter 1372, Government Code, or receives financial   assistance from another type of tax-exempt bond; or                      [ (D) ]  receives financial assistance administered   under Subchapter DD, Chapter 2306, Government Code.           (c)     Subject to Subsection (g) of this section, a   property-based exemption under Section 392.005(a) for a   multifamily residential development to which Subsection (b)   applies is available only if the development satisfies the other   requirements of this chapter and if:                 (1)     any applicable audit report requirements provided   by Section 392.0052 are satisfied, other than those imposed on a   multifamily residential development under the circumstances   described by Subsection (g);                 (2)     the authority submits to the Texas Department of   Housing and Community Affairs and to the county tax   assessor-collector for the applicable appraisal district in which   the exemption is sought a one-time exemption application on a form   promulgated by the comptroller;                 (3)     a portion of the units in the multifamily   residential development are reserved as follows:                       (A)  at least:                             (i)     10 percent of the units are reserved for   occupancy as lower income housing units, as defined under Section   303.0425; and                             (ii)     40 percent of the units are reserved   for occupancy as moderate income housing units, as defined under   Section 303.0425; or                       (B)     at least 20 percent of the units are reserved   for occupancy by:                             (i)     recipients of assistance administered   through a project-based rental assistance program; or                             (ii)     individuals or families earning not   more than 30 percent of the area median income, adjusted for family   size, as defined by the United States Department of Housing and   Urban Development;                 (4)     the authority delivers to the presiding officer of   the governing body of each taxing unit in which the development is   to be located written notice of the development, at least 30 days   before the date:                       (A)     the authority takes action to approve a new   multifamily residential development or the acquisition of an   occupied multifamily residential development; and                       (B)     of any public hearing required to be held   under Section 303.0421(c);                 (5)     a majority of the members of the board are not   elected representatives of the governing body of the political   subdivision or subdivisions that established the authority, the   development is approved by the governing body of the municipality   in which the development is located or, if the development is not   located in a municipality, the county in which the development is   located, except that the approval described by this subdivision is   not required for a multifamily residential development that   reserves a portion of units as described by Subdivision (3)(B);                 (6)     for a multifamily residential development that is   acquired by an authority, the development is occupied or was   occupied within the two-year period preceding the date of the   acquisition and is not otherwise subject to a land use restriction   agreement under Section 2306.185, Government Code, and:                       (A)     not less than 15 percent of the total gross   cost of the existing development, as shown in the settlement   statement, is expended on rehabilitating, renovating,   reconstructing, or repairing the development, with initial   expenditures and construction activities:                             (i)     beginning not later than the first   anniversary of the date of the acquisition; and                             (ii)     finishing not later than the third   anniversary of the date of the acquisition; or                       (B)     at least 25 percent of the units are reserved   for occupancy as lower income housing units;                 (7)     not less than 30 days before the date of final   approval of the development:                       (A)     the authority conducts, or obtains from a   professional entity that has experience underwriting affordable   multifamily residential developments and does not have a financial   interest in the applicable development, developer, or authority, an   underwriting assessment of the proposed development that allows the   authority to make a good faith determination that, for an occupied   multifamily residential development acquired by an authority or for   a newly constructed multifamily residential development owned by an   authority, the total annual amount of rent reduction on the   income-restricted residential units provided at the development   will be not less than 60 percent of the estimated amount of the   annual ad valorem taxes that would be imposed on the property   without an exemption from those taxes under Section 392.005(a) for   the second, third, and fourth years after the date of acquisition by   the authority or the date the certificate of occupancy is issued for   the development, as applicable; and                       (B)     the authority publishes on its Internet   website a copy of the underwriting assessment described by   Paragraph (A);                 (8)     the percentage of lower and moderate income   housing units reserved in each category of income-restricted   residential units in the development, based on the number of   bedrooms per unit, is the same as the percentage o [Text truncated for display. 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