SRC-JEC S.B. 1077 78(R)   BILL ANALYSIS


Senate Research Center   S.B. 1077
78R7467 KEL-DBy: Shapleigh
International Relations and Trade
4/21/2003
As Filed


DIGEST AND PURPOSE 

Currently, Texas spends millions of dollars in supplying basic
infrastructure to colonias.  However, colonia residents do not hold title
to the colonia property, and can never build home equity because most
colonia residents do not qualify for traditional home loans.  As proposed,
S.B. 1077 establishes a down payment assistance program to assist colonia
residents in obtaining a home. 

RULEMAKING AUTHORITY

Rulemaking authority is expressly granted to the Texas Department of
Housing and Community Affairs in SECTION  7 (Section 2306.787, Government
Code) of this bill. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends the heading to Subchapter GG, Chapter 2306, Government
Code, as added by Chapter 1367, Acts of the 77th Legislature, Regular
Session, 2001, to read as follows: 

SUBCHAPTER GG.  COLONIA MODEL SUBDIVISION AND DOWN PAYMENT ASSISTANCE
PROGRAMS 

SECTION 2.  Amends Section 2306.781, as added by Chapter 1367, Acts of the
77th Legislature, Regular Session, 2001, Government Code, as follows: 

Sec. 2306.781.  New heading:  DEFINITIONS.  Defines "down payment
assistance program" and redefines "program" as "model subdivision
program." 

SECTION 3.  Amends the heading to Section 2306.782, Government Code, as
added by Chapter 1367, Acts of the 77th Legislature, Regular Session,
2001, to read as follows: 

 Sec. 2306.782.  ESTABLISHMENT OF MODEL SUBDIVISION PROGRAM.

SECTION  4.  Amends Section 2306.783(a), Government Code, as added by
Chapter 1367, Acts of the 77th Legislature, Regular Session, 2001, to make
a conforming change. 

SECTION  5.  Amends Section 2306.785, Government Code, as added by Chapter
1367, Acts of the 77th Legislature, Regular Session, 2001, as follows: 

Sec. 2306.785.  New heading:  MODEL SUBDIVISION PROGRAM LOANS.  Makes
conforming changes. 

SECTION  6.  Amends Section 2306.786, Government Code, as added by Chapter
1367, Acts of the 77th Legislature, Regular Session, 2001, as follows: 

Sec. 2306.786.  New heading:  ADMINISTRATION OF MODEL SUBDIVISION PROGRAM;
RULES.  Makes conforming changes. 
 
SECTION  7.  Amends Subchapter GG, Chapter 2306, Government Code, as added
by Chapter 1367, Acts of the 77th Legislature, Regular Session, 2001, by
adding Section 2306.787, as follows: 

Sec. 2306.787.  COLONIA DOWN PAYMENT ASSISTANCE PROGRAM.  (a)  Defines
"colonia" and "eligible individuals and families." 

(b)  Requires the Texas Department of Housing and Community Affairs
(TDHCA) to establish the colonia down payment assistance program to
provide down payment assistance to individuals and families of extremely
low and very low income who would otherwise remain in substandard
colonias. 

(c)  Authorizes TDHCA, on application, to provide a loan to eligible
individuals and families under this section by using money from the
portion of community development block grants that is set aside under
federal law to provide financial assistance to colonias.  Prohibits TDHCA,
in a state fiscal year, from providing loans under this section using more
than $2 million from the set-aside for colonias. 

(d)  Provides that a loan made by TDHCA under the down payment assistance
program may bear interest at a reasonable rate set by TDHCA and may not
exceed a term of 30 years. 

(e)  Requires TDHCA, in administering the down payment assistance program,
by rule to adopt program guidelines and loan application procedures. 

SECTION  8.  Amends Section 2306.586(b), Government Code, to require a
self-help center to set a goal to improve the living conditions of
residents in the colonias designated under Section 2306.583(b), rather
than 2306.583(a)(2), within a one-year, rather than a two-year, period
after a  contract is awarded under this subchapter. 

SECTION  9.  Amends Section 15.951(2), Water Code, as added by Chapter
1234, Acts of the 77th Legislature, Regular Session, 2001, to redefine
"colonia." 

SECTION  10.  Repealer:  Section 2306.255(g) (pertaining to the use of
TDHCA services), Government Code. 

SECTION  11.  (a)  Requires TDHCA to adopt the rules required by Section
2306.787, Government Code, as added by this Act, not later than December
1, 2003. 

(b)  Makes application of the changes in law made by SECTIONS 8 and 9 of
this Act prospective. 

SECTION  12.  Effective date:  September 1, 2003.