By: Barrientos S.B. No. 1365
Line and page numbers may not match official copy.
Bill not drafted by TLC or Senate E&E.
A BILL TO BE ENTITLED
AN ACT
1-1 relating to purposes and powers of the Texas State Affordable
1-2 Housing Corporation.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Subchapter Y, Chapter 2306, Government Code, is
1-5 amended to read as follows:
1-6 SUBCHAPTER Y. TEXAS STATE AFFORDABLE HOUSING CORPORATION
1-7 Sec. 2306.551. DEFINITION. In this subchapter,
1-8 "corporation" means the Texas State Affordable Housing Corporation.
1-9 Sec. 2306.552. CREATION. (a) The existence of the Texas
1-10 State Affordable Housing Corporation, or any similarly named
1-11 corporation, begins on the date that the secretary of state issues
1-12 the certificate of incorporation.
1-13 (b) The charter of the corporation must establish the
1-14 corporation as nonprofit and specifically dedicate the
1-15 corporation's activities to the public purposes authorized by this
1-16 subchapter [benefit of the department].
1-17 (c) The creation of the corporation does not limit or impair
1-18 the rights, powers, and duties of the department under this
1-19 chapter.
1-20 Sec. 2306.553. PURPOSES. (a) The public purpose of the
1-21 corporation is to perform such activities and services as are
2-1 determined by the corporation's board of directors to promote the
2-2 health, safety, and welfare of the state and its citizens through
2-3 the provision of adequate, safe, and sanitary housing for
2-4 individuals and families of low and very low income and families of
2-5 moderate income. Such activities and services shall include,
2-6 without limitation, engaging in mortgage banking activities and
2-7 lending transactions, acquiring, holding, and selling or leasing
2-8 real and personal property, and performing such other activities
2-9 and services as the corporation's board of directors determines are
2-10 in furtherance of the public purposes of the corporation. [The
2-11 corporation shall carry out the public purposes of this chapter on
2-12 behalf of the state.]
2-13 [(b) The corporation may engage only in the performance of
2-14 charitable functions.]
2-15 (b) The corporation's primary purpose shall be to facilitate
2-16 the provision of housing and the making of loans affordable to
2-17 individuals and families of low and very low income and families of
2-18 moderate income. All loans for single family homes shall be made
2-19 only to individuals and families of low and very low income and
2-20 families of moderate income. Multifamily activities may be
2-21 undertaken which benefit mixed income groups but only so long as at
2-22 least twenty percent (20%) of the units in a multifamily
2-23 development assisted are affordable to individuals and families at
2-24 or below sixty percent (60%) of the applicable median family
2-25 income, adjusted for family size.
3-1 (c) To the extent reasonably practicable, the corporation
3-2 shall utilize the services of banks, community banks, savings
3-3 banks, thrifts, savings and loan associations, private mortgage
3-4 companies, nonprofit organizations and other lenders for the
3-5 origination of all loans contemplated by this subchapter, and
3-6 assist such lenders in the facilitation of the provision of credit
3-7 to individuals and families of low and very low income, and
3-8 families of moderate income.
3-9 Sec. 2306.554. BOARD OF DIRECTORS AND OFFICERS. (a) The
3-10 members of the board serve as the board of directors of the
3-11 corporation. Except as described in Subsection (b), members of the
3-12 corporation's board of directors and the president serve without
3-13 compensation but are entitled to reimbursement for actual expenses
3-14 incurred in attending meetings of the corporation's board of
3-15 directors and in performing their respective duties as directors
3-16 and president.
3-17 (b) The director shall serve ex-officio as president of the
3-18 corporation only if the director has experience in the field of
3-19 mortgage banking or residential lending as demonstrated by
3-20 (1) employment in one or more middle or upper level
3-21 management positions for at least two (2) years with a mortgage
3-22 bank, commercial bank, thrift, savings and loan association,
3-23 private mortgage company, mortgage servicing entity or other
3-24 financial institution, or
3-25 (2) employment in a position of providing legal or
4-1 consulting services related to mortgage banking or residential
4-2 lending to any one of the type of entities listed in Subsection
4-3 (b)(1) for at least five (5) years. If the director does not
4-4 satisfy the requirements of Subsection (b)(1) or (2), the
4-5 corporation shall employ, for compensation to be determined by the
4-6 corporation's board of directors, an individual that satisfies the
4-7 requirements of Subsection (b)(1) or (2) to serve as president of
4-8 the corporation.
4-9 (c) The corporation may purchase, with corporation funds,
4-10 liability insurance for each of the members of the corporation's
4-11 board of directors and the officers and other employees of the
4-12 corporation in an amount that the corporation's board of directors
4-13 considers reasonably necessary to:
4-14 (1) insure against reasonably foreseeable liabilities;
4-15 and
4-16 (2) provide for all costs of defending against those
4-17 liabilities, including, without limitation, court costs and
4-18 attorneys' fees.
4-19 Sec. 2306.555. POWERS. (a) The corporation has the powers
4-20 [and is subject to the limitations] provided for the department
4-21 under this chapter.
4-22 (b) [Except as specifically provided by this subchapter, the
4-23 corporation has] In addition to the powers granted in Subsection
4-24 (a), the corporation has all rights and powers necessary to
4-25 accomplish its public purposes, including, without limitation, the
5-1 power:
5-2 (1) to purchase, service, sell, lend on the security
5-3 of, or otherwise transact in:
5-4 (A) mortgages, including federal mortgages and
5-5 federally insured mortgages;
5-6 (B) mortgage loans;
5-7 (C) deeds of trust; and
5-8 (D) loans or other advances of credit (secured
5-9 by liens against manufactured housing);
5-10 (2) to guarantee or insure timely payment of mortgage
5-11 loans and loans or other advances of credit secured by liens
5-12 against manufactured housing, provided that the corporation's
5-13 liability on such guaranty or insurance shall be limited to the
5-14 assets of a guaranty fund or self-insurance fund, or both,
5-15 established and maintained by the corporation;
5-16 (3) to make mortgage loans and loans or other advances
5-17 of credit secured by liens against manufactured housing to
5-18 individuals and families of low and very low income and families of
5-19 moderate income;
5-20 (4) to make mortgage loans for the purpose of
5-21 providing temporary or permanent financing or refinancing for
5-22 housing developments and land developments, including the refunding
5-23 of outstanding obligations, mortgages, or advances issued for those
5-24 purposes;
5-25 (5) to borrow, give security, pay interest or other
6-1 return and issue bonds or other obligations, including notes,
6-2 debentures or mortgage-backed securities, provided that each bond
6-3 or other obligation issued by the corporation must contain a
6-4 statement that the state is not obligated to pay the principal
6-5 thereof, or any premium or interest thereon, and that neither the
6-6 faith or credit, nor the taxing power, of the state is pledged,
6-7 given or loaned to such a payment;
6-8 (6) to acquire, hold, invest, use, pledge, reserve,
6-9 and dispose of its assets, revenues, income, receipts, funds, and
6-10 money from every source and to select one or more depositories,
6-11 inside or outside the state, all subject to the terms of any
6-12 resolution, indenture, or other contract pursuant to which any
6-13 bonds or other obligations are issued or any guaranty or insurance
6-14 is provided;
6-15 (7) to establish, charge, and collect fees, charges,
6-16 and penalties in connection with the programs, services, and
6-17 activities of the corporation;
6-18 (8) to procure insurance and pay premiums on insurance
6-19 of any type, in amounts, and from insurers as the corporation's
6-20 board of directors considers necessary and advisable to further any
6-21 of the corporation's purposes, including, subject to Section
6-22 2306.554(c), liability insurance for the members of the
6-23 corporation's board of directors and officers and other employees
6-24 of the corporation;
6-25 (9) to make, enter into, and enforce contracts,
7-1 agreements, leases, indentures, mortgages, deeds, deeds of trust,
7-2 security agreements, pledge agreements, credit agreements, and
7-3 other instruments with any person, including any mortgage lender,
7-4 any servicer, any housing sponsor, the federal government, or any
7-5 public agency, on such terms as may be acceptable to the
7-6 corporation;
7-7 (10) to own, rent, lease, or otherwise acquire,
7-8 accept, or hold real, personal, or mixed property, or any interest
7-9 in property, by purchase, exchange, gift, assignment, transfer,
7-10 foreclosure, mortgage, sale, lease, or otherwise and to hold,
7-11 manage, operate, or improve real, personal, or mixed property,
7-12 wherever situated;
7-13 (11) to sell, lease, encumber, mortgage, exchange,
7-14 donate, convey, or otherwise dispose of any or all of its
7-15 properties or any interest in its properties, deed of trust or
7-16 mortgage lien interest owned by it or under its control, custody,
7-17 or in its possession, and release or relinquish any right, title,
7-18 claim, lien, interest, easement, or demand however acquired,
7-19 including any equity or right of redemption in property foreclosed
7-20 by it, and to do any of the foregoing by public or private sale,
7-21 with or without public bidding; and to lease or rent any
7-22 improvements, lands, or facilities from any person;
7-23 (12) to request, accept, and use gifts, loans,
7-24 donations, aid, guaranties, allocations, subsidies, grants, or
7-25 contributions of any item of value for the furtherance of any of
8-1 its purposes; and
8-2 (13) to exercise the rights and powers of a nonprofit
8-3 corporation incorporated under the Texas Non-Profit Corporation Act
8-4 (Article 1396-1.01 et seq., Vernon's Texas Civil Statutes).
8-5 (c) The corporation may contract with the department and
8-6 with bond counsel, financial advisors, [or] underwriters or other
8-7 providers of professional or consulting services related to its
8-8 activities.
8-9 (d) All expenses of the corporation shall be paid from any
8-10 and all funds available to the corporation without resort to
8-11 general revenues of the state, except as are otherwise specifically
8-12 appropriated.
8-13 Sec. 2306.556. [TAX] EXEMPT FROM TAXATION AND REGISTRATION.
8-14 (a) The corporation is exempt from all taxation by the state or a
8-15 political subdivision of the state, including a municipality.
8-16 (b) The bonds and other obligations issued by the
8-17 corporation are exempt securities under The Securities Act (Article
8-18 581-1, et seq., Vernon's Texas Civil Statutes), and unless
8-19 specifically provided otherwise, under any subsequently enacted
8-20 securities act. Any contract, guaranty, or other document executed
8-21 in connection with the issuance of such bonds and other obligations
8-22 is not a security under The Securities Act (Article 581-1, et seq.,
8-23 Vernon's Texas Civil Statutes), and, unless specifically provided
8-24 otherwise, any subsequently enacted securities act.
8-25 Sec. 2306.557. Distribution of Earnings. Any part of
9-1 earnings remaining after payment of expenses and the establishment
9-2 of reserves as determined by the corporation's board of directors
9-3 may not inure to any person except that the corporation shall
9-4 deposit these excess earnings with the department to the credit of
9-5 the housing trust [general revenue] fund established in Section
9-6 2306.201 [for the benefit of the department] if the corporation's
9-7 board of directors determines that sufficient provision has been
9-8 made for the full payment of the expenses, bonds, and other
9-9 obligations of the corporation and the establishment of sufficient
9-10 reserves, if any, for such purposes.
9-11 Sec. 2306.558. Alteration and Termination. (a) Subject to
9-12 this subchapter and the prohibition on the impairment of contracts
9-13 in the law of this state, the corporation's board of directors by
9-14 written resolution may alter the structure, organization, programs,
9-15 or activities of the corporation or terminate and dissolve the
9-16 corporation.
9-17 (b) The corporation's board of directors shall dissolve the
9-18 corporation if the board by resolution determines that:
9-19 (1) the purposes for which the corporation was formed
9-20 have been substantially fulfilled; and
9-21 (2) all bonds and other obligations issued by the
9-22 corporation and all guaranties and insurance and other contractual
9-23 obligations have been fully paid or provided for.
9-24 (c) On dissolution, the title to funds and properties
9-25 previously owned by the corporation shall be transferred to the
10-1 department.
10-2 Sec. 2306.559. REPORTING REQUIREMENTS [ANNUAL REPORT].
10-3 (a) The corporation shall file an annual report of the financial
10-4 activity of the corporation with the department. Not later than
10-5 thirty days after the board receives the report, the board shall
10-6 submit the report to the governor, the lieutenant governor, the
10-7 speaker of the house of representatives, and the comptroller of
10-8 public accounts.
10-9 (b) The corporation shall file the report before the 90th
10-10 day after the last day of the corporation's fiscal year.
10-11 (c) The corporation shall prepare the report in accordance
10-12 with generally accepted accounting principles.
10-13 (d) The report must include:
10-14 (1) a statement of support, revenue, and expenses and
10-15 change in fund balances;
10-16 (2) a statement of functional expenses; and
10-17 (3) balance sheets for all funds.
10-18 (e) The corporation shall file quarterly performance reports
10-19 of its activities with the department.
10-20 (f) The corporation shall file with the Texas Bond Review
10-21 Board a report for the preceding fiscal year, promptly upon receipt
10-22 of the same, containing the status of all outstanding debts and
10-23 obligations of the corporation, and the collateral pledged as
10-24 security for such debts and obligations, and a maturity and payment
10-25 schedule for all outstanding debts and obligations of the
11-1 corporation.
11-2 Sec. 2306.560. AUDIT. The corporation shall hire an
11-3 independent certified public accountant to audit the corporation's
11-4 books and accounts for each of the corporation's fiscal years. The
11-5 corporation shall file a copy of the audit with the department.
11-6 Not later than thirty days after the board receives the audit, the
11-7 board shall submit the audit to the governor, the lieutenant
11-8 governor, the speaker of the house of representatives, the
11-9 comptroller of public accounts and the Texas Bond Review Board.
11-10 Sec. 2306.561. LIABILITY. (a) The directors, officers, and
11-11 employees of the corporation shall not be liable personally for
11-12 bonds or other obligations issued or contracts, guaranties, and
11-13 insurance executed by the corporation, or for any other action
11-14 taken in accordance with the powers and duties authorized by this
11-15 subchapter or in the good faith belief that such action was taken
11-16 in accordance with the powers and duties authorized by this
11-17 subchapter.
11-18 (b) The directors and officers of the corporation shall be
11-19 immune from civil liability to the same extent that a volunteer who
11-20 is serving as an officer, director, or trustee of a charitable
11-21 organization is immune from civil liability pursuant to the
11-22 Charitable Immunity and Liability Act of 1987 (Chapter 84, Civil
11-23 Practices and Remedies Code, Vernon's Texas Codes).
11-24 (c) The civil liability of employees of the corporation
11-25 shall be limited to the same extent that the civil liability of
12-1 employees of a charitable organization is limited pursuant to the
12-2 Charitable Immunity and Liability Act of 1987 (Chapter 84, Civil
12-3 Practices and Remedies Code, Vernon's Texas Codes).
12-4 (d) The limitations on liability contained in this section
12-5 shall not limit or impair the limitations on liability otherwise
12-6 available to the corporation's directors, officers and employees.
12-7 SECTION 2. The importance of this legislation and the
12-8 crowded condition of the calendars in both houses create an
12-9 emergency and an imperative public necessity that the
12-10 constitutional rule requiring bills to be read on three several
12-11 days in each house be suspended, and this rule is hereby suspended,
12-12 and that this Act take effect and be in force from and after its
12-13 passage, and it is so enacted.