By: Menendez H.B. No. 3872

A BILL TO BE ENTITLED

AN ACT

relating to the eligibility of certain applications for low income housing tax credits

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 2306.6703, Government Code, as amended by Chapters 330 and 1106, Acts of the 78th Legislature, Regular Session, 2003, is reenacted and amended to read as follows:

Sec. 2306.6703. INELIGIBILITY FOR CONSIDERATION. (a) An application is ineligible for consideration under the low income housing tax credit program if:

(1) at the time of application or at any time during the two-year period preceding the date the application round begins, the applicant or a related party is or has been:

(A) a member of the board; or

(B) the director, a deputy director, the director of housing programs, the director of compliance, the director of underwriting, or the low income housing tax credit program manager employed by the department;

(2) the applicant proposes to replace in less than 15 years any private activity bond financing of the development described by the application, unless:

(A) the applicant proposes to maintain for a period of 30 years or more 100 percent of the development units supported by housing tax credits as rent-restricted and exclusively for occupancy by individuals and families earning not more than 50 percent of the area median income, adjusted for family size; and

(B) at least one-third of all the units in the development are public housing units or Section 8 project-based units; or

(3) unless the applicant obtains approval of the development from the governing body of the appropriate municipality or county containing the development, the applicant proposes to develop [construct] a new construction development that is located one linear mile or less from a development that:

(A) serves the same type of household as the new development[, regardless of whether the developments serve families, elderly individuals, or another type of household];

(B) has received an allocation of housing tax credits for new construction at any time during the three-year period preceding the date the application round begins; and

(C) has not been withdrawn or terminated from the low income housing tax credit program; [or]

(4) the development is located in a municipality or, if located outside a municipality, a county that has more than twice the state average of units per capita supported by housing tax credits or private activity bonds, unless the applicant:

(A) obtains [has obtained prior] approval of the development from the governing body of the appropriate municipality or county containing the development; and

(B) provides, not later than the 30th day before the date the board first meets to consider applications for an allocation of housing tax credits, [has included in the application] a written statement of support from that governing body referencing this section and authorizing an allocation of housing tax credits for the development.

(b) Subsections (a)(2), (3), and (4) do [Subsection (a)(3) does] not apply to a development:

(1) that is using:

(A) federal HOPE VI funds or other similar funds received through the United States Department of Housing and Urban Development to assist in the preservation, through same-site reconstruction or rehabilitation, of distressed federally assisted housing;

(B) locally approved funds received from a public improvement district or a tax increment financing district;

(C) funds provided to the state under the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. Section 12701 et seq.); [or]

(D) funds provided to the state and participating jurisdictions under the Housing and Community Development Act of 1974 (42 U.S.C. Section 5301 et seq.);

(2) that is located in a county with a population of less than one million[;

[(3) that is located outside of a metropolitan statistical area; or

[(4) that a local government where the project is to be located has by vote specifically allowed the construction of a new development located within one linear mile or less from a development under Subsection (a)].

SECTION 2. Section 2306.6711(f), Government Code, is amended to read as follows:

(f) The board may allocate housing tax credits to developments [more than one development] in a single community that are or will be less than one linear mile apart, as defined by department rule, in the same calendar year only if:

(1) the community is located in a county with a population of one million or less;

(2) at least one allocation involves the rehabilitation of existing developments, with not more than one new construction allocation; or

(3) the developments each serve a different type of household from the other [the developments are or will be located more than one linear mile apart]. [This subsection applies only to communities contained within counties with populations exceeding one million.]

SECTION 3. It is the intent of the legislature that the passage by the 80th Legislature, Regular Session, 2007, of another bill that amends Chapter 2306, Government Code, and the amendments made by this Act shall be harmonized, if possible, as provided by Section 311.025(b), Government Code, so that effect may be given to each. If the amendments made by this Act to Chapter 2306, Government Code, and the amendments made to Chapter 2306, Government Code, by any other bill are irreconcilable, it is the intent of the legislature that this Act prevail, regardless of the relative dates of enactment of this Act and the other bill or bills, but only to the extent that any differences are irreconcilable.

SECTION 4. This Act takes effect September 1, 2007.