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By: Lucio S.B. No. 628
(In the Senate - Filed February 21, 2005; March 1, 2005,
read first time and referred to Committee on Intergovernmental
Relations; April 26, 2005, reported adversely, with favorable
Committee Substitute by the following vote: Yeas 5, Nays 0;
April 26, 2005, sent to printer.)
COMMITTEE SUBSTITUTE FOR S.B. No. 628 By: Wentworth
A BILL TO BE ENTITLED
AN ACT
relating to an urban land bank program in certain municipalities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The heading to Chapter 379C, Local Government
Code, is amended to read as follows:
CHAPTER 379C. URBAN LAND BANK [DEMONSTRATION] PROGRAM
SECTION 2. Section 379C.001, Local Government Code, is
amended to read as follows:
Sec. 379C.001. SHORT TITLE. This chapter may be cited as
the Urban Land Bank [Demonstration] Program Act.
SECTION 3. Section 379C.002, Local Government Code, is
amended to read as follows:
Sec. 379C.002. APPLICABILITY. This chapter applies only to
a municipality with [home-rule municipalities that:
[(1) have] a population of 100,000 [1.18 million] or
more[; and
[(2) are located predominantly in a county that has a
total area of less than 1,000 square miles].
SECTION 4. Section 379C.003, Local Government Code, is
amended by amending Subdivisions (1), (5), and (6) and adding
Subdivision (1-a) to read as follows:
(1) "Affordable" means that the monthly mortgage
payment or contract rent does not exceed 30 percent of the
applicable median family income for that unit size, in accordance
with the income and rent limit rules adopted by the Texas Department
of Housing and Community Affairs.
(1-a) "Community housing development organization" or
"organization" means an organization that:
(A) meets the definition of a community housing
development organization in 24 C.F.R. Section 92.2; and
(B) is certified by the municipality as a
community housing development organization.
(5) "Urban land bank [demonstration] plan" or "plan"
means a plan adopted by the governing body of a municipality as
provided by Section 379C.006.
(6) "Urban land bank [demonstration] program" or
"program" means a program adopted under Section 379C.004.
SECTION 5. Section 379C.004, Local Government Code, is
amended to read as follows:
Sec. 379C.004. URBAN LAND BANK [DEMONSTRATION] PROGRAM.
(a) The governing body of a municipality may adopt an urban land
bank [demonstration] program in which the officer charged with
selling real property ordered sold pursuant to foreclosure of a tax
lien may sell certain eligible real property by private sale for
purposes of affordable housing development as provided by this
chapter.
(b) The governing body of a municipality that adopts an
urban land bank [demonstration] program shall establish or approve
a land bank for the purpose of acquiring, holding, and transferring
unimproved real property under this chapter.
SECTION 6. Section 379C.005, Local Government Code, is
amended to read as follows:
Sec. 379C.005. QUALIFIED PARTICIPATING DEVELOPER. To
qualify to participate in an urban land bank [demonstration]
program, a developer must:
(1) have developed [built] three or more housing units
within the three-year period preceding the submission of a proposal
to the land bank seeking to acquire real property from the land
bank;
(2) have a development plan approved by the
municipality for the land bank property; and
(3) meet any other requirements adopted by the
municipality in the urban land bank [demonstration] plan.
SECTION 7. The heading to Section 379C.006, Local
Government Code, is amended to read as follows:
Sec. 379C.006. URBAN LAND BANK [DEMONSTRATION] PLAN.
SECTION 8. Subsections (a) and (b), Section 379C.006, Local
Government Code, are amended to read as follows:
(a) A municipality that adopts an urban land bank
[demonstration] program shall operate the program in conformance
with an urban land bank [demonstration] plan.
(b) The governing body of a municipality that adopts an
urban land bank [demonstration] program shall adopt a plan
annually. The plan may be amended from time to time.
SECTION 9. Section 379C.008, Local Government Code, is
amended by amending Subsection (a) and adding Subsection (j) to
read as follows:
(a) Notwithstanding any other law and except as provided by
Subsection (f), property that is ordered sold pursuant to
foreclosure of a tax lien may be sold in a private sale to a land
bank by the officer charged with the sale of the property without
first offering the property for sale as otherwise provided by
Section 34.01, Tax Code, if:
(1) the market value of the property as specified in
the judgment of foreclosure is less than the total amount due under
the judgment, including all taxes, penalties, and interest, plus
the value of nontax liens held by a taxing unit and awarded by the
judgment, court costs, and the cost of the sale;
(2) the property is not improved with a building or
buildings;
(3) there are delinquent taxes on the property for a
total of at least five [each of the preceding six] years; and
(4) the municipality has executed with the other
taxing units that are parties to the tax suit an interlocal
agreement that enables those units to agree to participate in the
program while retaining the right to withhold consent to the sale of
specific properties to the land bank.
(j) Property sold to and held by the land bank for
subsequent resale is eligible for an exemption from ad valorem
taxes for a period not to exceed three years from the date of
acquisition.
SECTION 10. Subsection (c), Section 379C.010, Local
Government Code, is amended to read as follows:
(c) If property is developed for rental housing, the deed
restrictions must be for a period of not less than 20 [15] years and
must require that:
(1) 100 percent of the rental units be occupied by and
affordable to households with incomes not greater than 60 percent
of area median family income, based on gross household income,
adjusted for household size, for the metropolitan statistical area
in which the municipality is located, as determined annually by the
United States Department of Housing and Urban Development;
(2) 40 percent of the units be occupied by and
affordable to households with incomes not greater than 50 percent
of area median family income, based on gross household income,
adjusted for household size, for the metropolitan statistical area
in which the municipality is located, as determined annually by the
United States Department of Housing and Urban Development; or
(3) 20 percent of the units be occupied by and
affordable to households with incomes not greater than 30 percent
of area median family income, based on gross household income,
adjusted for household size, for the metropolitan statistical area
in which the municipality is located, as determined annually by the
United States Department of Housing and Urban Development.
SECTION 11. Section 379C.011, Local Government Code, is
amended by amending Subsections (a) and (c) and adding Subsection
(d-1) to read as follows:
(a) In this section, "qualified organization" means a
community housing development organization that:
(1) contains within its designated geographical
boundaries of operation, as set forth in its application for
certification filed with and approved by the municipality, a
portion of the property that the land bank is offering for sale;
(2) has built at least three single-family homes or
duplexes or one multifamily residential dwelling of four or more
units in compliance with all applicable building codes within the
preceding two-year period and within the organization's designated
geographical boundaries of operation; and
(3) within the preceding three-year [two-year] period
has developed [built] or rehabilitated housing units within a two
[one-half] mile radius of the property that the land bank is
offering for sale.
(c) Notice must be provided to the qualified organizations
by certified mail, return receipt requested, not later than the
60th day before the beginning of the period in which a right of
first refusal may be exercised.
(d-1) If the land bank conveys the property to a qualified
organization before the expiration of the period specified by the
municipality under Subsection (d), the interlocal agreement
executed under Section 379C.008(a)(4) must provide tax abatement
for the property until the expiration of that period.
SECTION 12. (a) The changes in law made by this Act apply
only to an urban land bank program operating in conformance with an
urban land bank plan adopted by the governing body of a municipality
on or after the effective date of this Act. An urban land bank
program operating in conformance with an urban land bank plan
adopted before the effective date of this Act is governed by the law
in effect at the time the plan was adopted until a subsequent plan
is adopted, and the former law is continued in effect for that
purpose.
(b) Subsection (j), Section 379C.008, Local Government
Code, as added by this Act, does not affect tax liability accruing
before the effective date of this Act. That liability continues in
effect as if this Act had not been enacted, and the former law is
continued in effect for the collection of taxes due and for civil
and criminal enforcement of the liability for those taxes.
SECTION 13. This Act takes effect September 1, 2005.
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