HBA-KDB H.B. 1392 77(R)BILL ANALYSIS Office of House Bill AnalysisH.B. 1392 By: Keffer Ways & Means 7/20/2001 Enrolled BACKGROUND AND PURPOSE Under current law, property owned by community housing development organizations (CHDOs) are exempted from ad valorem taxation. This exemption is potentially vital to the continued preservation and development of affordable housing in Texas. However, prior to the 77th Legislature, CHDOs were required to refile applications for exemptions every year. This annual redetermination may have weakened the impact of the exemption because the resulting property tax savings were potentially given less weight when analyzing the CHDOs net operating income to obtain financing. House Bill 1392 adds the CHDO exemption to the list of other charitable exemptions that qualify for a one-time application for exemption. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS House Bill 1392 amends the Tax Code to add exemptions from taxation for community housing development organizations (CHDO) that improve property for low-income and moderate-income housing to the list of exemptions that need not be claimed in subsequent years. The bill requires an organization, if any property owned by the organization receiving an exemption from taxation for CHDOs has been acquired or sold during the preceding year, to file by March 31 of the following year with the chief appraiser in the county in which the relevant property is located, on a form promulgated by the comptroller of public accounts, a list of such properties acquired or sold during the preceding year. To facilitate the financing associated with the acquisition of a low-income property, the bill authorizes an organization, before acquiring the property, to request from the chief appraiser of the appraisal district established for the county in which the property is located a preliminary determination of whether the property would qualify for an exemption as a CHDO improving property for low-income and moderateincome housing if acquired by the organization. The bill provides that a request must include the information that would be included in an application for an exemption for low-income or moderate-income housing. The bill requires the chief appraiser, not later than the 21st day after the date a request is submitted, to issue a written preliminary determination for the property included in the request. The bill repeals the provision that a person claiming a tax exemption for a CHDO must apply for the exemption for each year the person claims the exemption. EFFECTIVE DATE June 14, 2001.