BILL ANALYSIS

H.B. 2153

By: Kuempel

Business & Industry

Committee Report (Unamended)

BACKGROUND AND PURPOSE

In the City of Schertz, 200 undeveloped platted lots cannot be built on because they are still under residential-only deed restrictions from 1963. Under current law, amendments to a restrictive covenant of a subdivision must be approved by the property owners, but city leaders and property owners contend that identifying and locating all the property owners can be extremely burdensome and difficult, particularly for certain subdivisions that are multi-zoned and located in multiple counties and municipalities. H.B. 2153 seeks to address this issue by revising the procedures by which restrictive covenants applicable to certain subdivisions may be amended. 

CRIMINAL JUSTICE IMPACT

It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

H.B. 2153 amends the Property Code to provide for the amendment of restrictive covenants applicable to property in a multi-zoned subdivision located wholly or partly in a municipality that has a population of 30,000 or more and is located in at least three counties. The bill authorizes such an amendment to apply to all or part of the subdivision and to affect different portions of the subdivision differently, but clarifies that an approved amendment is effective and applies to each separately owned lot in the area designated as subject to the amendment.

H.B. 2153 requires an amendment of restrictions to be approved by the owners of at least 67 percent of the lots in the area of the subdivision designated in the relevant ballot as subject to the proposed amendment. The bill limits to one vote the votes to be cast for each lot and authorizes the vote of multiple owners of a property to be reflected by the signature or vote of one of the owners. The bill sets out the required contents of the ballot, which must be in writing, requires a ballot to be mailed to each owner of a lot in the subdivision area to which the proposed amendment applies, and requires a copy of the ballot to be recorded in the real property records of each county in which the subdivision is located before the vote is held. If an amendment is approved, a document certifying the approval must also be recorded in those property records, and such a filed document is considered prima facie evidence that the required vote was attained and the required procedures for the vote were followed.

H.B. 2153 prohibits an owner of property within the subdivision to which approved amended restrictions apply from claiming in any judicial proceeding that the amendment is not enforceable on the grounds that the amendment is not applicable to all of the property in the subdivision.

H.B. 2153 applies to a multi-zoned subdivision that was platted before 1965, has more than 900 lots, and is located in two or more separately incorporated municipalities, and at least one portion of the plat of which is zoned for a use other than a use permitted by the applicable restrictions. The bill applies to a restrictive covenant enacted before, on, or after the bill's effective date.

EFFECTIVE DATE

On passage, or, if the bill does not receive the necessary vote, September 1, 2023.