SRC-JEC H.B. 3383 77(R)   BILL ANALYSIS


Senate Research Center   H.B. 3383
77R12290 EBy: Davis, Yvonne (Lucio)
Intergovernmental Relations
5/7/2001
Engrossed


DIGEST AND PURPOSE 

Under current law, properties owned by community housing development
organizations are exempt from ad valorem taxation. However, concerns exist
that some organizations are taking advantage of the exemption without
reinvesting the savings that are realized by the organization's tax exempt
status and are not using surplus revenue generated by affordable housing
units to maintain the property or offer other support services. H.B. 3383
prohibits rental property owned by an organization from being exempted from
taxation in a subsequent tax year unless in the preceding tax year the
organization spent a certain percentage of the exemption in that year on
specified development services.  

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a
state officer, institution, or agency.  

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 11.182, Tax Code, by amending Subsection (b) and
adding Subsection (f), as follows: 

(b) Prohibits rental property owned by an organization that is exempted
under Subsection (a) from being exempted in a subsequent tax year unless in
the preceding tax year the organization spent an amount equal to at least
50 percent of the amount of the exemption in that year on social,
education, or economic development services for eligible persons in the
jurisdiction granting the exemption. 

(f) Provides that an organization is not required to spend at least 50
percent of the amount of the exemption as prescribed in Subsection (b) if
the organization acquired the property using tax-exempt bond financing
after January 1, 1997, and before December 31, 2001. 

SECTION 2.   Effective date: January 1, 2002.
  Makes application of this Act prospective.