By Hill H.B. No. 2962
75R7223 KEL-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the purposes and powers of the Texas State Affordable
1-3 Housing Corporation.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subchapter Y, Chapter 2306, Government Code, as
1-6 added by Chapter 76, Acts of the 74th Legislature, Regular Session,
1-7 1995, is amended to read as follows:
1-8 SUBCHAPTER Y. TEXAS STATE
1-9 AFFORDABLE HOUSING CORPORATION
1-10 Sec. 2306.551. DEFINITION. In this subchapter,
1-11 "corporation" means the Texas State Affordable Housing Corporation.
1-12 Sec. 2306.552. CREATION. (a) The existence of the Texas
1-13 State Affordable Housing Corporation, or any similarly named
1-14 corporation, begins on the date that the secretary of state issues
1-15 the certificate of incorporation.
1-16 (b) The charter of the corporation must establish the
1-17 corporation as nonprofit and specifically dedicate the
1-18 corporation's activities to the public purpose authorized by this
1-19 subchapter [benefit of the department].
1-20 (c) The creation of the corporation does not limit or impair
1-21 the rights, powers, and duties of the department under this
1-22 chapter.
1-23 Sec. 2306.553. PURPOSES. (a) The public purpose of the
1-24 corporation is to perform activities and services that the
2-1 corporation's board of directors determines will promote the
2-2 public health, safety, and welfare through the provision of
2-3 adequate, safe, and sanitary housing for individuals and families
2-4 of low to moderate income. The activities and services shall
2-5 include engaging in mortgage banking activities and lending
2-6 transactions, acquiring, holding, selling, or leasing real or
2-7 personal property, and performing other activities and services
2-8 determined by the corporation's board of directors to further the
2-9 public purpose of the corporation [corporation shall carry out the
2-10 public purposes of this chapter on behalf of the state].
2-11 (b) The corporation's primary public purpose is to
2-12 facilitate the provision of housing and the making of affordable
2-13 loans to individuals and families of low to moderate income. The
2-14 corporation may make loans for single family homes only to
2-15 individuals and families of low to moderate income. The
2-16 corporation may make loans for multifamily developments if:
2-17 (1) at least 40 percent of the units in a multifamily
2-18 development are affordable to individuals and families with incomes
2-19 at or below 60 percent of the median family income, adjusted for
2-20 family size; or
2-21 (2) at least 20 percent of the units in a multifamily
2-22 development are affordable to individuals and families with incomes
2-23 at or below 50 percent of the median family income, adjusted for
2-24 family size [corporation may engage only in the performance of
2-25 charitable functions].
2-26 (c) To the extent reasonably practicable, the corporation
2-27 shall use the services of banks, community banks, savings banks,
3-1 thrifts, savings and loan associations, private mortgage
3-2 companies, nonprofit organizations, and other lenders for the
3-3 origination of all loans contemplated by this subchapter, and
3-4 assist the lenders in providing credit to individuals and families
3-5 of low to moderate income.
3-6 Sec. 2306.554. BOARD OF DIRECTORS AND OFFICERS. (a) The
3-7 members of the board serve as the board of directors of the
3-8 corporation. Except as described by Subsection (b), members of the
3-9 corporation's board of directors and the president of the
3-10 corporation serve without compensation but are entitled to
3-11 reimbursement for actual expenses incurred in attending meetings of
3-12 the corporation's board of directors and in performing their
3-13 respective duties as directors and president.
3-14 (b) The director shall serve ex officio as president of the
3-15 corporation if the director has experience in the field of mortgage
3-16 banking or residential lending, as demonstrated by:
3-17 (1) employment in one or more middle or upper level
3-18 management positions for at least two years with a mortgage bank,
3-19 commercial bank, thrift, savings and loan association, private
3-20 mortgage company, mortgage servicing entity, or other financial
3-21 institution; or
3-22 (2) employment for at least five years in a position
3-23 providing legal or consulting services to any one of the types of
3-24 entities listed in Subsection (b)(1).
3-25 (c) If the director does not satisfy the requirements of
3-26 Subsection (b)(1) or (b)(2), the corporation shall employ, for
3-27 compensation to be determined by the corporation's board of
4-1 directors, an individual who satisfies the requirements of
4-2 Subsection (b)(1) or (b)(2) to serve as president of the
4-3 corporation.
4-4 (d) The corporation may purchase, with corporation funds,
4-5 liability insurance for the members of the corporation's board of
4-6 directors and the officers and other employees of the corporation
4-7 in an amount that the corporation's board of directors considers
4-8 reasonably necessary to:
4-9 (1) insure against reasonably foreseeable liabilities;
4-10 and
4-11 (2) provide for all costs of defending against those
4-12 liabilities, including court costs and attorney's fees.
4-13 Sec. 2306.555. POWERS. (a) The corporation has the powers
4-14 [and is subject to the limitations] provided for the department
4-15 under this chapter.
4-16 (b) In addition to the powers granted by Subsection (a), the
4-17 corporation has all rights and powers necessary to accomplish its
4-18 public purpose, including the powers to:
4-19 (1) purchase, service, sell, lend on the security of,
4-20 or otherwise transact in:
4-21 (A) mortgages, including federal mortgages and
4-22 federally insured mortgages;
4-23 (B) mortgage loans;
4-24 (C) deeds of trust; and
4-25 (D) loans or other advances of credit secured by
4-26 liens against manufactured housing;
4-27 (2) guarantee or insure timely payment of mortgage
5-1 loans and loans or other advances of credit secured by liens
5-2 against manufactured housing, provided that the corporation's
5-3 liability on that guaranty or insurance is limited to the assets of
5-4 a guaranty fund or self-insurance fund established and maintained
5-5 by the corporation;
5-6 (3) make mortgage loans and loans or other advances of
5-7 credit secured by liens against manufactured housing to individuals
5-8 and families of low to moderate income;
5-9 (4) make mortgage loans to provide temporary or
5-10 permanent financing or refinancing for housing or land
5-11 developments, including refunding outstanding obligations,
5-12 mortgages, or advances issued for those purposes;
5-13 (5) borrow, give security, pay interest or other
5-14 return, or issue bonds or other obligations, including notes,
5-15 debentures, or mortgage-backed securities, provided that each bond
5-16 or other obligation issued by the corporation must contain a
5-17 statement that the state is not obligated to pay the principal of
5-18 or any premium or interest on the bond or other obligation and that
5-19 the full faith and credit and the taxing power of the state are not
5-20 pledged, given, or loaned to the payment;
5-21 (6) acquire, hold, invest, use, pledge, reserve, and
5-22 dispose of its assets, revenues, income, receipts, funds, and money
5-23 from every source and to select one or more depositories, inside or
5-24 outside the state, subject to the terms of any resolution,
5-25 indenture, or other contract under which any bonds or other
5-26 obligations are issued or any guaranty or insurance is provided;
5-27 (7) establish, charge, and collect fees, charges, and
6-1 penalties in connection with the programs, services, and activities
6-2 of the corporation;
6-3 (8) procure insurance and pay premiums on insurance of
6-4 any type, in amounts, and from insurers as the corporation's board
6-5 of directors considers necessary and advisable to further the
6-6 corporation's public purpose, including, subject to Section
6-7 2306.554(d), liability insurance for the members of the
6-8 corporation's board of directors and the officers and other
6-9 employees of the corporation;
6-10 (9) make, enter into, and enforce contracts,
6-11 agreements, leases, indentures, mortgages, deeds, deeds of trust,
6-12 security agreements, pledge agreements, credit agreements, and
6-13 other instruments with any person, including a mortgage lender,
6-14 servicer, housing sponsor, the federal government, or any public
6-15 agency, on terms the corporation determines may be acceptable;
6-16 (10) own, rent, lease, or otherwise acquire, accept,
6-17 or hold real, personal, or mixed property, or any interest in
6-18 property, by purchase, exchange, gift, assignment, transfer,
6-19 foreclosure, mortgage, sale, lease, or otherwise and to hold,
6-20 manage, operate, or improve real, personal, or mixed property,
6-21 regardless of location;
6-22 (11) sell, lease, encumber, mortgage, exchange,
6-23 donate, convey, or otherwise dispose of any or all of its
6-24 properties or any interest in its properties, deed of trust, or
6-25 mortgage lien interest owned by it or under its control, custody,
6-26 or in its possession, and release or relinquish any right, title,
6-27 claim, lien, interest, easement, or demand however acquired,
7-1 including any equity or right of redemption in property foreclosed
7-2 by it, by public or private sale, with or without public bidding;
7-3 (12) lease or rent any improvements, lands, or
7-4 facilities from any person;
7-5 (13) request, accept, and use gifts, loans, donations,
7-6 aid, guaranties, allocations, subsidies, grants, or contributions
7-7 of any item of value to further its public purpose; and
7-8 (14) exercise [Except as specifically provided by this
7-9 subchapter, the corporation has] the rights and powers of a
7-10 nonprofit corporation incorporated under the Texas Non-Profit
7-11 Corporation Act (Article 1396-1.01 et seq., Vernon's Texas Civil
7-12 Statutes).
7-13 (c) The corporation may contract with the department and
7-14 with bond counsel, financial advisors, [or] underwriters, or other
7-15 providers of professional or consulting services.
7-16 (d) The corporation shall pay its expenses from any
7-17 available fund without resort to general revenues of the state,
7-18 except as specifically appropriated by the legislature.
7-19 Sec. 2306.556. [TAX] EXEMPT FROM TAXATION AND REGISTRATION.
7-20 (a) The corporation is exempt from all taxation by the state or a
7-21 political subdivision of the state, including a municipality.
7-22 (b) A bond or other obligation issued by the corporation is
7-23 an exempt security under The Securities Act (Article 581-1, et
7-24 seq., Vernon's Texas Civil Statutes), and unless specifically
7-25 provided otherwise, under any subsequently enacted securities act.
7-26 Any contract, guaranty, or other document executed in connection
7-27 with the issuance of the bond or other obligation is not an exempt
8-1 security under that Act, and unless specifically provided
8-2 otherwise, under any subsequently enacted securities act.
8-3 Sec. 2306.557. DISTRIBUTION OF EARNINGS. Any part of
8-4 earnings remaining after payment of expenses and any establishment
8-5 of reserves by the corporation's board of directors may not inure
8-6 to any person except that the corporation shall deposit these
8-7 excess earnings with the department to the credit of the housing
8-8 trust [general revenue] fund established by Section 2306.201 [for
8-9 the benefit of the department] if the corporation's board of
8-10 directors determines that sufficient provision has been made for
8-11 the full payment of the expenses, bonds, and other obligations of
8-12 the corporation and for any establishment of reserves by the
8-13 corporation's board of directors.
8-14 Sec. 2306.558. ALTERATION AND TERMINATION. (a) Subject to
8-15 this subchapter and the prohibition on the impairment of contracts
8-16 in the law of this state, the corporation's board of directors by
8-17 written resolution may alter the structure, organization, programs,
8-18 or activities of the corporation or terminate and dissolve the
8-19 corporation.
8-20 (b) The corporation's board of directors shall dissolve the
8-21 corporation if the board by resolution determines that:
8-22 (1) the purposes for which the corporation was formed
8-23 have been substantially fulfilled; and
8-24 (2) all bonds and other obligations issued by the
8-25 corporation and all guaranties and insurance and other contractual
8-26 obligations have been fully paid or provision for that payment has
8-27 been made.
9-1 (c) On dissolution, the title to funds and properties
9-2 previously owned by the corporation shall be transferred to the
9-3 department.
9-4 Sec. 2306.559. REPORTING REQUIREMENTS [ANNUAL REPORT]. (a)
9-5 The corporation shall file an annual report of the financial
9-6 activity of the corporation with the department. Not later than
9-7 the 30th day after the corporation's board of directors receives
9-8 the report, the corporation's board of directors shall submit the
9-9 report to the governor, the lieutenant governor, the speaker of the
9-10 house of representatives, and the comptroller.
9-11 (b) The corporation shall file the report before the 90th
9-12 day after the last day of the corporation's fiscal year.
9-13 (c) The corporation shall prepare the report in accordance
9-14 with generally accepted accounting principles.
9-15 (d) The report must include:
9-16 (1) a statement of support, revenue, and expenses and
9-17 change in fund balances;
9-18 (2) a statement of functional expenses; and
9-19 (3) balance sheets for all funds.
9-20 (e) The corporation shall file quarterly performance reports
9-21 with the department.
9-22 (f) Promptly on receipt, the corporation shall file with the
9-23 Bond Review Board a report for the preceding fiscal year. The
9-24 report must contain the status of all outstanding debts and
9-25 obligations of the corporation, the status of collateral pledged as
9-26 security for those debts and obligations, and a maturity and
9-27 payment schedule for those debts and obligations.
10-1 Sec. 2306.560. AUDIT. The corporation shall hire an
10-2 independent certified public accountant to audit the corporation's
10-3 books and accounts for each fiscal year. The corporation shall
10-4 file a copy of the audit with the department. Not later than the
10-5 30th day after the corporation's board of directors receives the
10-6 audit, the corporation's board of directors shall submit the audit
10-7 to the governor, the lieutenant governor, the speaker of the house
10-8 of representatives, the comptroller, and the Bond Review Board.
10-9 Sec. 2306.561. LIABILITY. (a) The directors, officers, and
10-10 employees of the corporation are not personally liable for bonds or
10-11 other obligations issued or contracts, guaranties, or insurance
10-12 executed by the corporation, or for any other action taken in
10-13 accordance with the powers and duties authorized by this subchapter
10-14 or in the good faith belief that that action was taken in
10-15 accordance with the powers and duties authorized by this
10-16 subchapter.
10-17 (b) The directors and officers of the corporation are immune
10-18 from civil liability to the same extent that a volunteer who serves
10-19 as an officer, director, or trustee of a charitable organization is
10-20 immune from civil liability under Chapter 84, Civil Practice and
10-21 Remedies Code.
10-22 (c) The civil liability of an employee of the corporation is
10-23 limited to the same extent that the civil liability of an employee
10-24 of a charitable organization is limited under Chapter 84, Civil
10-25 Practice and Remedies Code.
10-26 (d) The limitations on liability contained in this section
10-27 do not limit or impair the limitations on liability otherwise
11-1 available to the corporation's directors, officers, and employees.
11-2 SECTION 2. The importance of this legislation and the
11-3 crowded condition of the calendars in both houses create an
11-4 emergency and an imperative public necessity that the
11-5 constitutional rule requiring bills to be read on three several
11-6 days in each house be suspended, and this rule is hereby suspended,
11-7 and that this Act take effect and be in force from and after its
11-8 passage, and it is so enacted.