1-1     By:  Barrientos                                        S.B. No. 269

 1-2           (In the Senate - Filed January 22, 1997; January 27, 1997,

 1-3     read first time and referred to Committee on Intergovernmental

 1-4     Relations; April 1, 1997, reported favorably by the following vote:

 1-5     Yeas 11, Nays 0; April 1, 1997, sent to printer.)

 1-6                            A BILL TO BE ENTITLED

 1-7                                   AN ACT

 1-8     relating to the waiver or alternate use of municipal impact fees.

 1-9           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

1-10           SECTION 1.  Chapter 395, Local Government Code, is amended by

1-11     adding Subchapter E to read as follows:

1-12            SUBCHAPTER E.  WAIVER OR ALTERNATE USE OF IMPACT FEES

1-13           Sec. 395.101.  AFFORDABLE HOUSING DEFINED.  In this

1-14     subchapter, "affordable housing" means housing for which financial

1-15     assistance is available under a program administered by the Texas

1-16     Department of Housing and Community Affairs, including the

1-17     community development block grant program and the low income

1-18     housing tax credit program.

1-19           Sec. 395.102.  MUNICIPAL WAIVER OF IMPACT FEES.  (a)  To

1-20     stimulate the development of affordable housing, a municipality by

1-21     ordinance may waive the collection of impact fees imposed under

1-22     this chapter. The municipality shall take measures to ensure that

1-23     the waiver results in the development of affordable housing.

1-24           (b)  The amount of impact fees waived under this section may

1-25     be claimed, by an applicant for state or federal matching funds or

1-26     tax credits for the development of the affordable housing, as local

1-27     matching funds under a state program or, if permitted by federal

1-28     law or regulation, under a federal program.

1-29           (c)  A municipality that authorizes a waiver of the

1-30     collection of impact fees under this section may not deny a waiver

1-31     to an eligible applicant because of the location of the affordable

1-32     housing.

1-33           Sec. 395.103.  ALTERNATE USE FOR IMPACT FEES COLLECTED.

1-34     (a)  The governing body of a municipality by ordinance may dedicate

1-35     proceeds from impact fees to establish a program to provide funds

1-36     for down payments to qualify individuals for single-family home

1-37     ownership.

1-38           (b)  The municipality may adopt an ordinance under this

1-39     section only after a public hearing.  The municipality shall

1-40     publish notice of the hearing once a week for three consecutive

1-41     weeks, the first notice to appear before the 30th day but on or

1-42     after the 60th day before the date of the hearing in one or more

1-43     newspapers of general circulation in the municipality.

1-44           (c)  An ordinance adopted under this section must establish:

1-45                 (1)  the total number of housing units eligible for

1-46     funds under the program;

1-47                 (2)  the method of calculating the reduction in project

1-48     costs for each housing unit; and

1-49                 (3)  the method of monitoring the level of income for

1-50     each applicant qualifying under the program.

1-51           Sec. 395.104.  INCREASE IN IMPACT FEES PROHIBITED.  Impact

1-52     fees imposed under this chapter may not be increased as a result of

1-53     a municipal waiver or alternate dedication of fees as provided by

1-54     this subchapter.

1-55           SECTION 2.  The importance of this legislation and the

1-56     crowded condition of the calendars in both houses create an

1-57     emergency and an imperative public necessity that the

1-58     constitutional rule requiring bills to be read on three several

1-59     days in each house be suspended, and this rule is hereby suspended,

1-60     and that this Act take effect and be in force from and after its

1-61     passage, and it is so enacted.

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