Bill Text: TX HB3393 | 2015-2016 | 84th Legislature | Comm Sub
Bill Title: Relating to underwriting standards for evaluating applications for low income housing tax credits.
Sponsorship: Partisan Bill (Republican 1)
Status: (Introduced - Dead) 2015-05-13 - Considered in Local & Consent Calendars [HB3393 Detail]
Download: Texas-2015-HB3393-Comm_Sub.html
| 84R20203 JAM-F | |||
| By: Anderson of Dallas | H.B. No. 3393 | ||
| Substitute the following for H.B. No. 3393: | |||
| By: Elkins | C.S.H.B. No. 3393 | ||
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| relating to underwriting standards for evaluating applications for | ||
| low income housing tax credits. | ||
| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
| SECTION 1. Section 2306.148, Government Code, is amended to | ||
| read as follows: | ||
| Sec. 2306.148. UNDERWRITING STANDARDS. (a) The board | ||
| shall have the specific duty and power to adopt underwriting | ||
| standards for: | ||
| (1) loans made or financed by the housing finance | ||
| division; and | ||
| (2) housing tax credits allocated by the department. | ||
| (b) Underwriting standards adopted under Subsection (a)(2) | ||
| and used to determine the feasibility of a proposed development | ||
| must be consistent with criteria established under Section | ||
| 2306.185. | ||
| SECTION 2. Section 2306.185, Government Code, is amended by | ||
| adding Subsections (d-1), (d-2), (d-3), and (d-4) and amending | ||
| Subsection (e) to read as follows: | ||
| (d-1) For developments receiving housing tax credits, the | ||
| department shall determine the feasibility of the development at | ||
| the time of cost certification using: | ||
| (1) actual net operating income, adjusted for | ||
| stabilization of rents and extraordinary lease-up expenses; and | ||
| (2) a maximum debt coverage ratio of 1.50 or higher as | ||
| adopted by department rule. | ||
| (d-2) A feasibility determination made under Subsection | ||
| (d-1) may not include a maximum operating expense-to-income ratio. | ||
| (d-3) In determining net operating income and making the | ||
| appropriate adjustments under Subsection (d-1)(1), the department | ||
| shall consider the permanent lender and equity partner | ||
| stabilization requirements documented in the loan and in the | ||
| partnership or entity agreements. | ||
| (d-4) The department may adopt rules providing for | ||
| exceptions to the maximum debt coverage ratio requirement of | ||
| Subsection (d-1)(2) with respect to specific types of projects. | ||
| (e) Subsections (c), [ |
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| (d-4) and Section 2306.269 apply only to multifamily rental housing | ||
| developments to which the department is providing one or more of the | ||
| following forms of assistance: | ||
| (1) a loan or grant in an amount greater than 33 | ||
| percent of the market value of the development on the date the | ||
| recipient completed the construction of the development; | ||
| (2) a loan guarantee for a loan in an amount greater | ||
| than 33 percent of the market value of the development on the date | ||
| the recipient took legal title to the development; or | ||
| (3) a low income housing tax credit. | ||
| SECTION 3. The change in law made by this Act applies only | ||
| to an application for low income housing tax credits that is | ||
| submitted to the Texas Department of Housing and Community Affairs | ||
| during an application cycle that begins on or after the effective | ||
| date of this Act. An application that is submitted during an | ||
| application cycle that began before the effective date of this Act | ||
| is governed by the law in effect at the time the application cycle | ||
| began, and the former law is continued in effect for that purpose. | ||
| SECTION 4. This Act takes effect September 1, 2015. | ||
