Bill Text: TX HB492 | 2025-2026 | 89th Legislature | Introduced

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Bill Title: Relating to prohibiting the allocation of low income housing tax credits for certain developments.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2024-11-12 - Filed [HB492 Detail]

Download: Texas-2025-HB492-Introduced.html

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89R1962 JG-D
By: Morales of Harris H.B. No. 492

A BILL TO BE ENTITLED
AN ACT
relating to prohibiting the allocation of low income housing tax
credits for certain developments.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 2306.6703(a), Government Code, is
amended to read as follows:
(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) at least one-third of all the units in the
development are public housing units or Section 8 project-based
units and the applicant proposes to maintain for a period of 30
years or more 100 percent of the 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;
(B) the applicable private activity bonds will be
redeemed only in an amount consistent with their proportionate
amortization; or
(C) if the redemption of the applicable private
activity bonds will occur in the first five years of the operation
of the development and complies with Section 42(h)(4), Internal
Revenue Code of 1986:
(i) on the date the certificate of
reservation is issued, the Bond Review Board determines that there
is not a waiting list for private activity bonds in the same
priority level established under Section 1372.0321 or, if
applicable, in the same uniform state service region, as referenced
in Section 1372.0231, that is served by the proposed development;
and
(ii) the applicable private activity bonds
will be redeemed according to underwriting criteria, if any,
established by the department;
(3) the applicant proposes to construct a new
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) has obtained prior approval of the
development from the governing body of the appropriate municipality
or county containing the development; and
(B) 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; or
(5) the development is not located within two miles of
a grocery store.
SECTION 2. 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 is based on the 2026 qualified
allocation plan or a subsequent plan adopted by the governing board
of the department under Section 2306.67022, Government Code. An
application that is submitted during an application cycle that is
based on an earlier qualified allocation plan is governed by the law
in effect on the date the application cycle began, and the former
law is continued in effect for that purpose.
SECTION 3. This Act takes effect September 1, 2025.