By Hill H.B. No. 3059
76R8549 KEL-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the operation of the Texas State Affordable Housing
1-3 Corporation.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 2306.554, Government Code, is amended to
1-6 read as follows:
1-7 Sec. 2306.554. BOARD OF DIRECTORS AND OFFICERS. (a) The
1-8 board of directors of the corporation consists of five [six]
1-9 members [as follows:]
1-10 [(1) the presiding officer of the board of directors
1-11 of the department;]
1-12 [(2) the presiding officer of the programs committee
1-13 of the board of directors of the department; and]
1-14 [(3) four members of the board of directors of the
1-15 corporation shall be] appointed by the governor who [and shall]
1-16 represent any of the following areas:
1-17 (1) [(A)] state or federal savings banks or savings
1-18 and loan associations;
1-19 (2) [(B)] community banks with assets of $200 million
1-20 or less;
1-21 (3) [(C)] large metropolitan banks with assets of more
1-22 than $1 billion;
1-23 (4) [(D)] asset management companies;
1-24 (5) [(E)] mortgage servicing companies;
2-1 (6) [(F)] builders;
2-2 (7) [(G)] real estate developers;
2-3 (8) [(H)] real estate brokers;
2-4 (9) [(I)] community or economic development
2-5 organizations;
2-6 (10) [(J)] private mortgage companies;
2-7 (11) [(K)] nonprofit housing development companies;
2-8 (12) [(L)] attorneys;
2-9 (13) [(M)] investment bankers;
2-10 (14) [(N)] underwriters;
2-11 (15) [(O)] private mortgage insurance companies;
2-12 (16) [(P)] appraisers;
2-13 (17) [(Q)] property management companies;
2-14 (18) [(R)] financial advisors;
2-15 (19) [(S)] nonprofit foundations;
2-16 (20) [(T)] financial advisors; or
2-17 (21) [(U)] any other area of expertise that the
2-18 governor finds necessary for the successful operation of the
2-19 corporation.
2-20 (b) The governor shall designate the [appoint a] presiding
2-21 officer of the corporation's board of directors from the members
2-22 [who are not also serving as members of the board of directors of
2-23 the department].
2-24 (c) A member of the corporation's board of directors is not
2-25 entitled to compensation, [except for the members who are also
2-26 members of the department's board of directors,] but is entitled to
2-27 reimbursement of travel expenses incurred by the member while
3-1 conducting the business of the board, as provided by the General
3-2 Appropriations Act.
3-3 (d) The corporation shall employ, for compensation to be
3-4 determined by the corporation's board of directors, a qualified
3-5 individual to serve as president of the corporation [The director
3-6 of the department shall serve ex officio as president of the
3-7 corporation]. The president is [not entitled to compensation,
3-8 unless the president is not also the executive director of the
3-9 department, but is] entitled to reimbursement from the corporation
3-10 of travel expenses incurred by the president [member] while
3-11 conducting the business of the corporation [board], as provided by
3-12 the General Appropriations Act. To qualify to serve as president,
3-13 an individual must have [The director of the department shall serve
3-14 as president of the corporation only if the director has]
3-15 experience in the field of mortgage banking or residential lending
3-16 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 in a position of providing legal or
3-23 consulting services related to mortgage banking or residential
3-24 lending to any one of the type of entities listed in Subsection
3-25 (d)(1) for at least five years.
3-26 (e) [If the director does not satisfy the requirements of
3-27 Subsection (d)(1) or (2), the corporation shall employ, for
4-1 compensation to be determined by the corporation's board of
4-2 directors, an individual that satisfies the requirements of
4-3 Subsection (d)(1) or (2) to serve as president of the corporation.]
4-4 [(f)] The corporation may purchase, with corporation funds,
4-5 liability insurance for each of the members of the corporation's
4-6 board of directors, officers, and other employees of the
4-7 corporation in an amount that the corporation's board of directors
4-8 considers reasonably necessary to:
4-9 (1) insure against foreseeable liabilities; and
4-10 (2) provide for all costs of defending against those
4-11 liabilities, including, without limitation, court costs and
4-12 attorney's fees.
4-13 SECTION 2. Sections 2306.555(b) and (c), Government Code,
4-14 are amended to read as follows:
4-15 (b) In addition to the powers granted by Subsection (a), the
4-16 corporation has all rights and powers necessary to accomplish its
4-17 public purpose, including the powers to:
4-18 (1) purchase, service, sell, lend on the security of,
4-19 or otherwise transact in:
4-20 (A) mortgages, including federal mortgages and
4-21 federally insured mortgages;
4-22 (B) mortgage loans;
4-23 (C) deeds of trust; and
4-24 (D) loans or other advances of credit secured by
4-25 liens against manufactured housing;
4-26 (2) guarantee or insure timely payment of mortgage
4-27 loans and loans or other advances of credit secured by liens
5-1 against manufactured housing, provided that the corporation's
5-2 liability on that guaranty or insurance is limited to the assets of
5-3 a guaranty fund or self-insurance fund established and maintained
5-4 by the corporation;
5-5 (3) make mortgage loans and loans or other advances of
5-6 credit secured by liens against manufactured housing to individuals
5-7 and families of low to moderate income;
5-8 (4) make mortgage loans to provide temporary or
5-9 permanent financing or refinancing for housing or land
5-10 developments, including refunding outstanding obligations,
5-11 mortgages, or advances issued for those purposes;
5-12 (5) borrow, give security, pay interest or other
5-13 return, or issue bonds or other obligations, including notes,
5-14 debentures, or mortgage-backed securities, provided that each bond
5-15 or other obligation issued by the corporation must contain a
5-16 statement that the state is not obligated to pay the principal of
5-17 or any premium or interest on the bond or other obligation and that
5-18 the full faith and credit and the taxing power of the state are not
5-19 pledged, given, or loaned to the payment;
5-20 (6) acquire, hold, invest, use, pledge, reserve, and
5-21 dispose of its assets, revenues, income, receipts, funds, and money
5-22 from every source and to select one or more depositories, inside or
5-23 outside the state, subject to the terms of any resolution,
5-24 indenture, or other contract under which any bonds or other
5-25 obligations are issued or any guaranty or insurance is provided;
5-26 (7) establish, charge, and collect fees, charges, and
5-27 penalties in connection with the programs, services, and activities
6-1 of the corporation;
6-2 (8) procure insurance and pay premiums on insurance of
6-3 any type, in amounts, and from insurers as the corporation's board
6-4 of directors considers necessary and advisable to further the
6-5 corporation's public purpose, including, subject to Section
6-6 2306.554(e) [2306.554(f)], liability insurance for the members of
6-7 the corporation's board of directors and the officers and other
6-8 employees of the corporation;
6-9 (9) make, enter into, and enforce contracts,
6-10 agreements, leases, indentures, mortgages, deeds, deeds of trust,
6-11 security agreements, pledge agreements, credit agreements, and
6-12 other instruments with any person, including a mortgage lender,
6-13 servicer, housing sponsor, the federal government, or any public
6-14 agency, on terms the corporation determines may be acceptable;
6-15 (10) own, rent, lease, or otherwise acquire, accept,
6-16 or hold real, personal, or mixed property, or any interest in
6-17 property, by purchase, exchange, gift, assignment, transfer,
6-18 foreclosure, mortgage, sale, lease, or otherwise and hold, manage,
6-19 operate, or improve real, personal, or mixed property, regardless
6-20 of location;
6-21 (11) sell, lease, encumber, mortgage, exchange,
6-22 donate, convey, or otherwise dispose of any or all of its
6-23 properties or any interest in its properties, deeds of trust, or
6-24 mortgage lien interest owned by it or under its control or custody,
6-25 or in its possession, and release or relinquish any right, title,
6-26 claim, lien, interest, easement, or demand, however acquired,
6-27 including any equity or right of redemption in property foreclosed
7-1 by it, by public or private sale, with or without public bidding;
7-2 (12) lease or rent any improvements, lands, or
7-3 facilities from any person;
7-4 (13) request, accept, and use gifts, loans, donations,
7-5 aid, guaranties, allocations, subsidies, grants, or contributions
7-6 of any item of value to further its public purpose; and
7-7 (14) exercise the rights and powers of a nonprofit
7-8 corporation incorporated under the Texas Non-Profit Corporation Act
7-9 (Article 1396-1.01 et seq., Vernon's Texas Civil Statutes).
7-10 (c) In exercising the foregoing powers granted to it under
7-11 this chapter, the corporation shall not actively compete with
7-12 private lenders and shall not originate or make a [any] loan that
7-13 [can or] would be made under [at] the same circumstances [time] by
7-14 a private lender on substantially the same or better terms within
7-15 the submarket in which the loan is proposed to be made[, and, to
7-16 the extent practical, the corporation shall rely on private
7-17 mortgage companies, banks, savings banks, thrifts, savings and loan
7-18 associations, or other similar loan originating entities to
7-19 originate loans. The corporation may act as co-originator in a
7-20 loan where the funding resources emanate from the corporation].
7-21 SECTION 3. Section 2306.557, Government Code, is amended to
7-22 read as follows:
7-23 Sec. 2306.557. DISTRIBUTION OF EARNINGS. Any part of
7-24 earnings remaining after payment of expenses and any establishment
7-25 of reserves by the corporation's board of directors may not inure
7-26 to any person except that the corporation shall use [deposit] these
7-27 excess earnings to further the corporation's new or existing
8-1 affordable housing initiatives [with the department to the credit
8-2 of the housing trust fund established by Section 2306.201] if the
8-3 corporation's board of directors determines that sufficient
8-4 provision has been made for the full payment of the expenses,
8-5 bonds, and other obligations of the corporation and for any
8-6 establishment of reserves by the corporation's board of directors.
8-7 SECTION 4. (a) This Act takes effect September 1, 1999.
8-8 (b) As soon as possible after the effective date of this
8-9 Act, the governor shall appoint a person to serve on the board of
8-10 directors of the Texas State Affordable Housing Corporation, as
8-11 required by Section 2306.554(a), Government Code, as amended by
8-12 this Act. The presiding officer of the board of directors of the
8-13 Texas Department of Housing and Community Affairs and the presiding
8-14 officer of the programs committee of the department's board who are
8-15 serving on the corporation's board immediately before the effective
8-16 date of this Act shall continue to serve on the corporation's board
8-17 until the date on which the person appointed by the governor
8-18 assumes membership duties on the corporation's board.
8-19 SECTION 5. The importance of this legislation and the
8-20 crowded condition of the calendars in both houses create an
8-21 emergency and an imperative public necessity that the
8-22 constitutional rule requiring bills to be read on three several
8-23 days in each house be suspended, and this rule is hereby suspended.