SRC-AAA S.B. 1048 75(R)BILL ANALYSIS


Senate Research CenterS.B. 1048
By: Truan
Finance
5-2-97
Committee Report (Amended)


DIGEST 

Currently, the law provides an ad valorem tax exemption for 
property acquired by a nonprofit 
housing organization during the time the organization is 
improving the property for transfer to its 
final owners.  This exemption applies only to an organization 
which constructs the housing primarily 
with volunteer help.  Community development organizations do not 
primarily use volunteer labor, 
yet they use public money to provide housing for low-income 
Texans.  This bill extends the ad 
valorem exemption to property acquired by community development 
organizations for the purpose 
of providing low-income and moderate-income housing during the 
time they hold the property.

PURPOSE

As proposed, S.B. 1048 extends the ad valorem exemption to 
property acquired by community 
development organizations for the purpose of providing low-income 
housing during the time they 
hold the property.

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 Chapter 11B, Tax Code, by adding Section 11.182, 
as follows:

Sec. 11.182. COMMUNITY HOUSING DEVELOPMENT ORGANIZATIONS 
IMPROVING PROPERTY FOR LOW-INCOME AND MODERATE-INCOME 
HOUSING. 
Provides that an organization is entitled to an exemption 
from taxation of improved or 
unimproved real property it owns if the organization meets 
certain requirements.  Prohibits 
property owned by the organization from being exempted after 
a certain period of time unless 
the property is offering to rent or renting the property 
without profit to a low-income or 
moderate-income individual or family.  Entitles an 
organization entitled to an exemption 
under Subsection (a) to also be exempt from taxation of any 
building used for acquisition, 
building, repair, sale, or rental of property.  Requires a 
person claiming an exemption for 
property described in this section to comply with the 
requirements of Sections 11.43(a) and 
(b). Sets forth the qualifications of the exemption. Defines 
"community housing development 
organization."

SECTION 2. Amends Section 11.436(a), Tax Code, to authorize an 
organization to apply for an 
exemption if it qualifies under Section 11.182(a), Tax Code.

SECTION 3. Amends Section 26.111(a), Tax Code, to make a 
conforming change.

SECTION 4. Effective date: January 1, 1998.

SECTION 5. Emergency clause.

SUMMARY OF COMMITTEE CHANGES

Amendment 1.

Amend Section 11.182, on page 2, line 6, by adding a new 
Subsection (c), to require a person 
claiming an exemption for property described in this section 
to comply with the requirements