GEC S.B. 568 75(R)BILL ANALYSIS


BUSINESS & INDUSTRY
S.B. 568
By: Truan (Oliveira)
5-20-97
Committee Report (Unamended)


BACKGROUND 

Currently, Texas law applies certain protections to the buyers and sellers
of real property who resort to the use of contracts for deed or executory
contracts in counties that meet the eligibility standards of the
Economically Distressed Areas Program (EDAP) and are within 200 miles of
an international border.  Current law also sets forth special requirements
and duties for county officials in qualified counties as well as the
buyers and sellers of property using executory contracts in qualified
counties. 

However, because a county's EDAP eligibility may change from year to year,
the requirements imposed upon buyers and sellers of real property as well
as county officials may change as a result. S.B. 568 would protect
contracts entered into while a county is EDAP-eligible, regardless of
whether the county remains EDAP-eligible.  In addition, this bill would
provide county officials as well as the buyers and sellers of property
with consistent requirements by continuing the application of Chapter 5E,
Property Code, for five years after the last year the Texas Department of
Housing and Community Affairs determines the county is EDAP-eligible. 

PURPOSE

As proposed, S.B. 568 provides that an executory contract that covers real
property located in a county that, as determined by the Texas Department
of Housing and Community Affairs, has certain levels of per capita income
and unemployment for the most recent three consecutive years, and is
within 200 miles of an international border, is governed by Chapter 5E,
Property Code, for the term of the contract regardless of whether the
county maintains these levels of per capita income and unemployment.
Furthermore, this bill provides that Chapter 5E, Property Code, applies to
transactions in such a county for five years after it has these levels of
per capita income and unemployment. 

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 5.091, Property Code, by adding Sections (e) and
(f), to provide that an executory contract to which this subchapter
applies at the time the contract is executed is governed by Chapter 5E,
Property Code, for the term of the contract  regardless of whether the
county in which the property is located is no longer described by
Subsection (a).  Provides that this subchapter continues to apply to
transactions in a county for five years after the last year the Texas
Department of Housing and Community Affairs (department) includes the
county in the determination made under Section 5.092. 

SECTION 2. Amends Section 5.092, Property Code, by adding Section (f), to
require the department, upon expiration of the period prescribed by
Section 5.091(f), to publish notification in the Texas Register that
Chapter 5E no longer applies to the county, and notify the county clerk of
the county that this subchapter no longer applies. 

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