By Naishtat H.B. No. 3339
76R2186 DB-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to a program of the Texas Department of Housing and
1-3 Community Affairs to promote for-profit construction of affordable
1-4 homes for low income homebuyers.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Chapter 2306, Government Code, is amended by
1-7 adding Subchapter EE to read as follows:
1-8 SUBCHAPTER EE. BUILDER INCENTIVE PARTNERSHIP PROGRAM
1-9 Sec. 2306.701. DEFINITIONS. In this subchapter:
1-10 (1) "Builder" means a person who builds or develops a
1-11 housing subdivision.
1-12 (2) "Cooperative purchase agreement" means an
1-13 agreement described by Section 2306.705.
1-14 (3) "Corporation" means the Texas State Affordable
1-15 Housing Corporation.
1-16 (4) "Cost plus profit structure" means a profit
1-17 structure that sets a fixed monetary profit due for the sale of a
1-18 home as opposed to a profit structure that sets a variable amount
1-19 of profit due for the sale of a home that is based on a percentage
1-20 of the sale price of the home.
1-21 (5) "Program" means the builder incentive partnership
1-22 program developed under this subchapter.
1-23 Sec. 2306.702. BUILDER INCENTIVE PARTNERSHIP PROGRAM. (a)
1-24 The department shall develop and maintain a builder incentive
2-1 partnership program to provide for the development of affordable
2-2 housing subdivisions in this state.
2-3 (b) To accomplish the goals of this subchapter, the
2-4 department shall:
2-5 (1) determine geographic areas that are in need of
2-6 affordable housing;
2-7 (2) provide for affordable housing development
2-8 projects in those areas by entering into a partnership agreement
2-9 with:
2-10 (A) an eligible builder or developer; and
2-11 (B) housing assistance agencies or other
2-12 nonprofit entities that provide housing assistance to low income
2-13 homebuyers; and
2-14 (3) work with the corporation, the builder or
2-15 developer, or housing assistance agencies or other nonprofit
2-16 entities that provide housing assistance to low income homebuyers
2-17 to obtain housing assistance for homebuyers who purchase homes
2-18 built under the program.
2-19 Sec. 2306.703. BUILDER PARTNERSHIP AGREEMENT. (a) Under a
2-20 partnership agreement for a specific project, the department and
2-21 the builder must agree to:
2-22 (1) a guaranteed purchase agreement in which the
2-23 department agrees to guarantee a negotiated portion of the purchase
2-24 price of a negotiated number of houses to be built under the
2-25 project;
2-26 (2) the terms of a cooperative purchase agreement
2-27 between the department and a housing assistance agency or other
3-1 nonprofit entity that provides housing assistance to low income
3-2 homebuyers;
3-3 (3) the type, style, and number of houses to be built
3-4 under the partnership, within the specifications required by
3-5 Section 2306.707;
3-6 (4) the types of housing assistance to be applied for
3-7 eligible low income homebuyers who purchase homes built under the
3-8 program; and
3-9 (5) any other term that the department determines
3-10 appropriate.
3-11 (b) The builder shall market the homes built under the
3-12 program to individuals and families who qualify for housing
3-13 assistance under department programs in the same manner in which
3-14 private housing development projects are marketed to the general
3-15 public.
3-16 (c) The department may not enter into a partnership
3-17 agreement for a specific project with a builder unless the builder
3-18 agrees to issue warranty deeds for the homes purchased under this
3-19 program.
3-20 Sec. 2306.704. COST PLUS PROFIT STRUCTURE. (a) The builder
3-21 in the partnership agreement may require homebuyers to purchase a
3-22 home under a cost plus profit structure.
3-23 (b) If a builder requires a cost plus profit structure, the
3-24 department and the builder must agree in the partnership agreement
3-25 to a reasonable profit for the builder for each type of home built
3-26 under the program.
3-27 (c) For the purposes of the partnership agreement and
4-1 housing finance assistance by the department or the corporation,
4-2 the profit set under the cost plus profit structure for a home
4-3 built under the program is part of the purchase price of the home.
4-4 Sec. 2306.705. COOPERATIVE PURCHASE AGREEMENT. (a) The
4-5 department shall negotiate and conclude a cooperative purchase
4-6 agreement with a housing assistance agency or other nonprofit
4-7 entity for each project under the program.
4-8 (b) Under the cooperative purchase agreement, a housing
4-9 assistance agency or other nonprofit entity must agree, at the
4-10 option of the builder, to purchase homes built under the project at
4-11 cost if the homes do not have a qualified purchaser within 30 days
4-12 of completion of the construction.
4-13 (c) The department may provide alternative or additional
4-14 conditions under the cooperative purchase agreement as necessary to
4-15 accomplish the purposes of this subchapter.
4-16 Sec. 2306.706. FUNDING. (a) The department and the
4-17 corporation may not spend state money to fund the guaranteed
4-18 purchase agreement required by this subchapter.
4-19 (b) The department and the corporation shall cooperate to
4-20 identify sources of funds that are appropriate for the program.
4-21 Sec. 2306.707. HOUSING STANDARDS. The department shall
4-22 establish and maintain standards for the homes built under the
4-23 program. The standards must include:
4-24 (1) the minimum quality of construction and amenities
4-25 required;
4-26 (2) an average cost between $30,000 and $50,000;
4-27 (3) a style and type of home that can accommodate
5-1 additional construction, but that is flexible enough to serve one
5-2 family; and
5-3 (4) other criteria that the department may provide.
5-4 Sec. 2306.708. HOMEBUYER PROGRAMS. (a) The department and
5-5 the corporation shall cooperate to identify:
5-6 (1) private lenders to provide private market-rate
5-7 mortgages for low income homebuyers who purchase homes under the
5-8 program; and
5-9 (2) housing assistance programs for low income
5-10 homebuyers who do not qualify for private market-rate mortgages.
5-11 (b) The department and the corporation shall provide other
5-12 housing assistance for low income homebuyers as necessary to
5-13 accomplish the purposes of this subchapter.
5-14 Sec. 2306.709. RULEMAKING AUTHORITY. The department may
5-15 adopt rules necessary to accomplish the purposes of this
5-16 subchapter.
5-17 SECTION 2. This Act takes effect September 1, 1999.
5-18 SECTION 3. The importance of this legislation and the
5-19 crowded condition of the calendars in both houses create an
5-20 emergency and an imperative public necessity that the
5-21 constitutional rule requiring bills to be read on three several
5-22 days in each house be suspended, and this rule is hereby suspended.