BILL ANALYSIS


                                                         H.B. 741
                                               By: Farrar (Ellis)
                                      Intergovernmental Relations
                                                         05-17-95
                              Senate Committee Report (Unamended)
BACKGROUND

As of December 1994, the City of Houston (city) was in possession
of 237 properties that it foreclosed upon because of delinquent
taxes.  Many of these properties are unmarketable as residential
properties, and the city has had difficulty conveying these
properties for the amount of taxes owed or the fair market value. 
Charitable organizations that develop properties for low-income
housing would like the city to foreclose on additional properties
that may be more suitable for residential development.  Due to the
large number of properties that the city has been unable to sell,
the city is hesitant to foreclose upon additional properties
because of requirements regarding the purchase and sale of such
properties, and the liability that the city incurs once it
forecloses on a property.

PURPOSE

As proposed, H.B. 741 creates an exemption to liability imposed on
municipalities with a population of 1.5 million for a claim arising
from land acquired at a sale following the foreclosure of a lien
held by the municipality.

RULEMAKING AUTHORITY

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

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Chapter 101C, Civil Practice and Remedies Code,
by adding Section 101.064, as follows:

     Sec. 101.064.  LAND ACQUIRED UNDER FORECLOSURE OF LIEN.  (a) 
     Provides that this section applies only to a municipality with
     a population of 1.5 million or more that acquires land at a
     sale following the foreclosure of a lien held by the
     municipality.
     
     (b)  Provides that this chapter does not apply to a claim
       that arises after the date the land was acquired and before
       the date the land is sold, conveyed, or exchanged by the
       municipality; and arises from the condition of the land, a
       premises defect on the land, or an action committed by any
       person, other than an agent or employee of the municipality,
       on the land.
       
       (c)  Defines "land."
       
       SECTION 2.   Makes application of this Act prospective.

SECTION 3. Emergency clause.
           Effective date: upon passage.