By Capelo H.B. No. 2666 76R3645 DB-D A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to a loan guarantee to convert a contract for deed to a 1-3 warranty deed. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Subchapter K, Chapter 2306, Government Code, is 1-6 amended by adding Section 2306.255 to read as follows: 1-7 Sec. 2306.255. CONTRACT FOR DEED CONVERSION PROGRAM. (a) 1-8 In this section, "office" means the office established by the 1-9 department to promote initiatives for colonias. 1-10 (b) The office shall establish a program to guarantee loans 1-11 made by private lenders to convert a contract for deed into a 1-12 warranty deed. 1-13 (c) The office shall make agreements with private lenders 1-14 that will issue loans for contract conversions under the guarantee 1-15 of the department. The office and the lender must agree on the 1-16 criteria for issuing a deed conversion loan, including the 1-17 percentage of the guarantee to be issued by the department. 1-18 (d) The office may not make an agreement with a lender 1-19 unless the agreement allows the office to annually renegotiate the 1-20 guarantee percentage for a loan issued by the lender. The office 1-21 shall renegotiate the terms of a guarantee when possible to obtain 1-22 a better guarantee percentage for the state from the lender. 1-23 (e) The office may establish eligibility criteria for a 1-24 holder of a contract for deed who participates in this program. 2-1 The criteria must include a priority for homeowners and owners of 2-2 residential real property who are individuals or families of low, 2-3 very low, or extremely low income. 2-4 (f) The office shall use funds allocated to the department 2-5 under the federal HOME Investment Partnerships program established 2-6 under Title II of the Cranston-Gonzalez National Affordable Housing 2-7 Act (42 U.S.C. Section 12701 et seq.) for a guarantee issued under 2-8 this section. The office may not spend state money to fund a 2-9 guarantee for a loan under the program. 2-10 (g) The office may use the services of the Texas State 2-11 Affordable Housing Corporation when necessary to accomplish the 2-12 purposes of this section. 2-13 (h) The office shall: 2-14 (1) compose an annual report that evaluates the 2-15 repayment history and coinciding guarantee percentages for 2-16 guarantees issued under this section; and 2-17 (2) deliver a copy of the report to the governor, the 2-18 lieutenant governor, and the speaker of the house of 2-19 representatives. 2-20 (i) The department may adopt rules necessary to accomplish 2-21 the purposes of this section. 2-22 SECTION 2. (a) This Act takes effect September 1, 1999. 2-23 (b) The office established by the Texas Department of 2-24 Housing and Community Affairs to promote initiatives for colonias 2-25 shall deliver the first report required by Section 2306.255(h), 2-26 Government Code, as added by this Act, not later than January 1, 2-27 2001. 3-1 SECTION 3. The importance of this legislation and the 3-2 crowded condition of the calendars in both houses create an 3-3 emergency and an imperative public necessity that the 3-4 constitutional rule requiring bills to be read on three several 3-5 days in each house be suspended, and this rule is hereby suspended.