81R9534 JJT-F

By: Lucio S.B. No. 2294

A BILL TO BE ENTITLED

AN ACT

relating to the administration and allocation of private activity bonds.

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

SECTION 1. Section 1372.004, Government Code, is amended to read as follows:

Sec. 1372.004. RULES; TEMPORARY RULES. (a) The board may adopt rules necessary to accomplish the purposes of this chapter.

(b) The board may adopt temporary rules regarding bonds described by Section 1372.022(a) as necessary to facilitate the purpose of any federal legislation related to bonds of those kinds that is enacted on or after the 60th day of a legislative session and the temporary rules are effective regardless of any provision of this chapter in conflict or inconsistent with the temporary rules. Temporary rules adopted under this subsection expire on the later of the following dates:

(1) the effective date of a law enacted by the legislature on the subject of bonds described by Section 1372.022(a) in the first regular or special legislative session that convenes before or after the temporary rules are adopted; or

(2) the final day of the next regular legislative session that convenes after the temporary rules are adopted.

SECTION 2. Section 1372.026(c), Government Code, is amended to read as follows:

(c) For purposes of this section, the local population of a housing finance corporation is the population of the local government or local governments on whose behalf a housing finance corporation is created. If two local governments that have a population of at least 50,000 [20,000] each and that have overlapping territory have created housing finance corporations that have the power to issue bonds to provide financing for home mortgages, the population of the housing finance corporation created on behalf of the larger local government is computed by subtracting from the population of the larger local government the population of the part of the smaller local government that is located in the larger local government. The reduction of population provided by this subsection is not required if the smaller local government assigns its authority to issue bonds, based on its population, to the larger local government.

SECTION 3. Section 1372.0261, Government Code, is amended by amending Subsections (c) and (d) and adding Subsection (e) to read as follows:

(c) If a housing finance corporation's utilization percentage is less than 80 [95] percent, the next time the corporation becomes eligible for a reservation of the state ceiling, the maximum amount of the state ceiling that may be reserved for the corporation is equal to the amount for which the corporation would otherwise be eligible under Section 1372.026 multiplied by the utilization percentage of the corporation's last bond issue that used an allocation of the state ceiling.

(d) A housing finance corporation may not be penalized under Subsection (c) if:

(1) the corporation fails to use:

(A) bond proceeds recycled from previous allocations of the state ceiling; or

(B) taxable bond proceeds; or

(2) as the result of an issuance of bonds, the corporation's utilization percentage is 80 [95] percent or greater.

(e) A housing finance corporation may not be penalized under Subsection (c) in a program year if, by December 31 of the preceding program year, an amount equal to or less than 50 percent of the aggregate state ceiling available for reservations by issuers of qualified mortgage bonds under Section 1372.022(a)(1):

(1) has been used in connection with bond issues that have closed on or before that date; or

(2) has had carryforward elections filed on or before that date.

SECTION 4. Section 1372.037(a), Government Code, is amended to read as follows:

(a) Except as provided by Subsection (b), before August 15 the board may not grant for any single project a reservation for that year that is greater than:

(1) $25 million, if the issuer is an issuer of qualified mortgage bonds, other than the Texas Department of Housing and Community Affairs or the Texas State Affordable Housing Corporation;

(2) $50 million, if the issuer is an issuer of a state-voted issue, other than the Texas Higher Education Coordinating Board, or $75 million, if the issuer is the Texas Higher Education Coordinating Board;

(3) the amount to which the Internal Revenue Code limits issuers of qualified small issue bonds and enterprise zone facility bonds, if the issuer is an issuer of those bonds;

(4) the lesser of $25 [$15] million or 15 percent of the amount set aside for reservation by issuers of qualified residential rental project bonds, if the issuer is an issuer of those bonds;

(5) the amount as prescribed in Sections 1372.033(d), (e), and (f), if the issuer is an issuer authorized by Section 53B.47 [53.47], Education Code, to issue qualified student loan bonds; or

(6) $50 million, if the issuer is any other issuer of bonds that require an allocation.

SECTION 5. This Act takes effect September 1, 2009.