By: Duncan S.B. No. 1635
A BILL TO BE ENTITLED
AN ACT
1-1 relating to increasing the efficiency of the utilization of the
1-2 state ceiling for qualified mortgage bonds.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Subsection (c), Section 3, Chapter 1092, Acts of
1-5 the 70th Legislature, Regular Session, 1987 (Article 5190.9a,
1-6 Vernon's Texas Civil Statutes), is amended to read as follows:
1-7 (c) The board shall not grant a reservation of a portion of
1-8 the state ceiling to any issuer prior to January 10. If two or
1-9 more issuers apply for a reservation of state ceiling in a category
1-10 described in Subsections (b)(2), (b)(3), (b)(4), and (b)(5) of
1-11 Section 2 of this Act on or before January 10, reservations within
1-12 that category shall be granted from the state ceiling available in
1-13 that category in an order determined by the board by lot. If two
1-14 or more housing finance corporations apply for a reservation of
1-15 state ceiling in the category described by Section 2(b)(1) of this
1-16 Act on or before January 10, reservations within that category
1-17 shall be granted from the state ceiling available in that category
1-18 according to the following categories of priority: (1) the first
1-19 category of priority shall include those applications for a
1-20 reservation filed by housing finance corporations which filed an
1-21 application for a reservation on behalf of the same local
1-22 population prior to September 1 of the previous calendar year, but
1-23 which did not receive a reservation during such year; (2) the
2-1 second category of priority shall include those applications for a
2-2 reservation filed by housing finance corporations to which state
2-3 ceiling could not be made available by August 31 for that calendar
2-4 year because of the application of Section 4(b) of this Act;
2-5 (3) the third category of priority shall include those applications
2-6 for a reservation not included in the first and second categories
2-7 of priority; and (4) within each category or priority, reservations
2-8 shall be granted in reverse calendar year order of the most recent
2-9 closing of qualified mortgage bonds by each housing finance
2-10 corporation, with the most recent closing being the last to receive
2-11 a reservation and with those housing finance corporations that have
2-12 never received a reservation for mortgage revenue bonds being the
2-13 first to receive a reservation, and, in the case of closings
2-14 occurring on the same date, reservations shall be granted in an
2-15 order determined by the board by lot. All applications for a
2-16 reservation filed after January 10 by any issuer for the issuance
2-17 of bonds shall be accepted by the board in their order of receipt.
2-18 A priority under (1) of an issuer composed of more than one
2-19 jurisdiction is not affected by the issuer's loss of a sponsoring
2-20 governmental unit and that unit's population base if the dollar
2-21 amount of the application has not increased. No governmental unit
2-22 shall join or separate from an issuer composed of more than one
2-23 jurisdiction simply for the purpose of obtaining a higher priority.
2-24 If a governmental unit chooses to separate from an issuer composed
2-25 of more than one jurisdiction, the departing sponsoring
3-1 governmental unit will have the same priority as the issuer from
3-2 which it separated. If a governmental unit chooses to separate
3-3 from an issuer composed of more than one jurisdiction and joins a
3-4 different issuer composed of more than one jurisdiction, the issuer
3-5 to which the governmental unit joins will have a priority of the
3-6 lower of the issuer to which they joined or from which they
3-7 separated. If several governmental units choose to separate from
3-8 one or more issuers composed of more than one jurisdiction and
3-9 collectively join a different issuer composed of more than one
3-10 jurisdiction, the issuer to which the governmental units join will
3-11 have a priority of the lowest of any of the issuers from which they
3-12 separated or the priority of the issuer to which they joined,
3-13 whichever is lower.
3-14 SECTION 2. Section 7, Chapter 1092, Acts of the 70th
3-15 Legislature, Regular Session, 1987 (Article 5190.9a, Vernon's Texas
3-16 Civil Statutes), is amended to read as follows:
3-17 Sec. 7. ISSUANCE AND DELIVERY. (a) Except as provided in
3-18 Subsections [Subsection] (b) and (c) of this section, the issuer
3-19 shall close on the bonds for which a reservation has been granted
3-20 not later than the 90th day after the reservation date.
3-21 (b) Issuers of qualified mortgage bonds shall close on the
3-22 bonds for which a reservation has been granted not later than the
3-23 180th day after the reservation date.
3-24 (c) Regardless of the deadline provided by Subsection (a) of
3-25 this section, the issuer shall close on the bonds before December
4-1 24.
4-2 (d) [(c)] If the issuer does not timely close on the bonds,
4-3 the issue's reservation is canceled and during the 120-day period
4-4 beginning on the reservation date of the canceled reservation:
4-5 (1) the issuer or any other issuer may not submit an
4-6 application for a reservation for the same project; and
4-7 (2) the issuer is eligible for a carryforward
4-8 designation for the project only as provided by Section 9 of this
4-9 Act.
4-10 (e) [(d)] Not later than the fifth business day after the
4-11 day on which the bonds are closed, the issuer shall submit to the
4-12 board:
4-13 (1) a written notice stating the delivery date of the
4-14 bonds and the principal amount of the bonds issued; and
4-15 (2) a certified copy of the document authorizing the
4-16 bonds and other documents relating to the issuance of the bonds,
4-17 including a statement of the bonds:
4-18 (A) principal amount;
4-19 (B) interest rate or formula by which the
4-20 interest rate is calculated;
4-21 (C) maturity schedule; and
4-22 (D) purchaser or purchasers.
4-23 (f) [(e)] The board shall adopt rules that require the
4-24 payment of closing fees simultaneously with the closing on the
4-25 bonds.
5-1 SECTION 3. Subdivision (13), Section 394.003, Local
5-2 Government Code, is amended to read as follows:
5-3 (13) "Residential development" means the acquisition,
5-4 construction, reconstruction, rehabilitation, repair, alteration,
5-5 improvement, or extension of any of the following items or any
5-6 combination of the following items for the purpose of providing
5-7 decent, safe, and sanitary housing and nonhousing facilities that
5-8 are an integral part of or are functionally related to any
5-9 affordable housing project whether in one or multiple locations
5-10 [the housing]:
5-11 (A) land, an interest in land, a building or
5-12 other structure, facility, system, fixture, improvement, addition,
5-13 appurtenance, or machinery or other equipment;
5-14 (B) real or personal property considered
5-15 necessary in connection with an item described by Paragraph (A); or
5-16 (C) real or personal property or improvements
5-17 functionally related and subordinate to an item described by
5-18 Paragraph (A).
5-19 SECTION 4. Subsection (h), Section 394.012, Local Government
5-20 Code, is amended to read as follows:
5-21 (h) For the purposes of determining the applicable
5-22 population for Section 3b, Chapter 1092, Acts of the 70th
5-23 Legislature, Regular Session, 1987 (Article 5190.9a, Vernon's Texas
5-24 Civil Statutes), the [The] joint housing finance corporation may
5-25 only consider areas in its own [not operate in more than one] state
6-1 planning region.
6-2 SECTION 5. Section 394.032, Local Government Code, is
6-3 amended by adding Subsection (e) to read as follows:
6-4 (e) A housing finance corporation may delegate to the Texas
6-5 Department of Housing and Community Affairs the authority to act on
6-6 its behalf in the financing, refinancing, acquisition, leasing,
6-7 ownership, improvement, and disposal of home mortgages or
6-8 residential developments, within and outside the jurisdiction of
6-9 the housing finance corporation, including its authority to issue
6-10 bonds for such purposes.
6-11 SECTION 6. Subsection (a), Section 394.037, Local Government
6-12 Code, is amended to read as follows:
6-13 (a) A housing finance corporation may issue bonds to defray,
6-14 in whole or in part:
6-15 (1) the development costs of a residential
6-16 development; or
6-17 (2) the costs of purchasing or funding the making of
6-18 home mortgages, either on a first come, first served basis or by
6-19 selling lender commitments, including the costs of studies and
6-20 surveys, insurance premiums, financial advisory services, mortgage
6-21 banking services, administrative services, underwriting fees, legal
6-22 services, accounting services, and marketing services incurred in
6-23 connection with the issuance and sale of the bonds, including bond
6-24 and interest reserve accounts, capitalized interest accounts, and
6-25 trustee, custodian, and rating agency fees.
7-1 SECTION 7. Subsection (a), Section 394.040, Local Government
7-2 Code, is amended to read as follows:
7-3 (a) A housing finance corporation may make, contract to
7-4 make, but is in no way required to make, and enter into advance
7-5 commitments to make home mortgages originated, administered, and
7-6 serviced by lending institutions. It may pay the reasonable value
7-7 of services rendered under those contracts. It may acquire,
7-8 contract to acquire, and enter into advance commitments to acquire,
7-9 by assignment or other means, home mortgages owned by lending
7-10 institutions at purchase prices and on other terms determined by
7-11 the corporation or its agent.
7-12 SECTION 8. Section 394.051, Local Government Code, is
7-13 amended by adding Subsection (h) to read as follows:
7-14 (h) The housing finance corporation is not required to sell
7-15 commitments to lenders to originate home mortgages. A housing
7-16 finance corporation may establish a program so that lenders will
7-17 utilize the proceeds of the bonds to originate home mortgages on a
7-18 first come, first served basis.
7-19 SECTION 9. The importance of this legislation and the
7-20 crowded condition of the calendars in both houses create an
7-21 emergency and an imperative public necessity that the
7-22 constitutional rule requiring bills to be read on three several
7-23 days in each house be suspended, and this rule is hereby suspended,
7-24 and that this Act take effect and be in force from and after its
7-25 passage, and it is so enacted.