1-1     By:  Lindsay                                          S.B. No. 1835
 1-2           (In the Senate - Filed May 3, 2001; May 3, 2001, read first
 1-3     time and referred to Committee on Intergovernmental Relations;
 1-4     May 7, 2001, reported favorably by the following vote:  Yeas 6,
 1-5     Nays 0; May 7, 2001, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to encumbrances that may be fixed on homestead property.
 1-9           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-10           SECTION 1.  Subsections (a) and (b), Section 41.001, Property
1-11     Code, are amended to read as follows:
1-12           (a)  A homestead and one or more lots used for a place of
1-13     burial of the dead are exempt from seizure for the claims of
1-14     creditors except for encumbrances described by Subsection (b)
1-15     [properly fixed on homestead property].
1-16           (b)  A homestead is not exempt from seizure as provided by
1-17     Subsection (a) for encumbrances that are [Encumbrances may be]
1-18     properly fixed on homestead property for:
1-19                 (1)  purchase money;
1-20                 (2)  taxes on the property;
1-21                 (3)  work and material used in constructing
1-22     improvements on the property if contracted for in writing as
1-23     provided by Sections 53.254(a), (b), and (c);
1-24                 (4)  an owelty of partition imposed against the
1-25     entirety of the property by a court order or by a written agreement
1-26     of the parties to the partition, including a debt of one spouse in
1-27     favor of the other spouse resulting from a division or an award of
1-28     a family homestead in a divorce proceeding; or
1-29                 (5)  the refinance of a lien against a homestead,
1-30     including a federal tax lien resulting from the tax debt of both
1-31     spouses, if the homestead is a family homestead, or from the tax
1-32     debt of the owner.
1-33           SECTION 2.  Subchapter A, Chapter 41, Property Code, is
1-34     amended by adding Section 41.0011 to read as follows:
1-35           Sec. 41.0011.  CERTAIN ENCUMBRANCES FIXED ON HOMESTEAD EXEMPT
1-36     FROM SEIZURE.  (a)  In this section, "property owners' association"
1-37     has the meaning assigned by Section 202.001.
1-38           (b)  An obligation to pay property owners' association fees
1-39     for maintenance and ownership of common facilities and services is
1-40     a debt for which an encumbrance may be properly fixed on homestead
1-41     property.
1-42           (c)  Homestead property is exempt from seizure for the claims
1-43     of creditors for an encumbrance described by Subsection (b).  A
1-44     property owners' association may collect on an encumbrance
1-45     described by Subsection (b) properly fixed on homestead property at
1-46     the time the homestead property is transferred.  Section 41.001(c)
1-47     does not apply to a claim of a property owners' association under
1-48     this section.
1-49           SECTION 3.  This Act takes effect January 1, 2002, but only
1-50     if the constitutional amendment proposed by the 77th Legislature,
1-51     Regular Session, 2001, permitting an encumbrance to be fixed on
1-52     homestead property for an obligation to pay certain property
1-53     owners' association fees without permitting the forced sale of the
1-54     homestead takes effect.  If that amendment is not approved by the
1-55     voters, this Act has no effect.
1-56                                  * * * * *