Bill Text: TX SB1918 | 2019-2020 | 86th Legislature | Engrossed
Bill Title: Relating to the creation of an urban land bank by certain municipalities; granting authority to issue bonds.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Engrossed - Dead) 2019-05-01 - Referred to Urban Affairs [SB1918 Detail]
Download: Texas-2019-SB1918-Engrossed.html
By: Alvarado | S.B. No. 1918 |
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relating to the creation of an urban land bank by certain | ||
municipalities; granting authority to issue bonds. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Subtitle A, Title 12, Local Government Code, is | ||
amended by adding Chapter 379H to read as follows: | ||
CHAPTER 379H. URBAN LAND BANK PROGRAM IN MUNICIPALITY WITH | ||
POPULATION OF TWO MILLION OR MORE | ||
SUBCHAPTER A. GENERAL PROVISIONS | ||
Sec. 379H.001. SHORT TITLE. This chapter may be cited as | ||
the Urban Land Bank Program for a Municipality with a Population of | ||
Two Million or More. | ||
Sec. 379H.002. APPLICABILITY OF CHAPTER. This chapter | ||
applies only to a municipality with a population of two million or | ||
more. | ||
Sec. 379H.003. DEFINITIONS. In this chapter: | ||
(1) "Board" means the board of directors of a land | ||
bank. | ||
(2) "Land bank" means an entity established or | ||
approved by the governing body of a municipality under this | ||
chapter. | ||
(3) "Non-qualifying municipality" means a | ||
municipality to which this chapter does not apply and that is | ||
located in the same county in which a municipality to which this | ||
chapter does apply is predominantly located. | ||
(4) "Real property" means land, land under water, and | ||
any structure, easement, air rights, franchise, or incorporeal | ||
hereditament, every estate, interest, and right therein, legal and | ||
equitable, including terms for years and liens by way of judgment, | ||
mortgage, or otherwise, and any fixture or improvement located | ||
thereon. | ||
Sec. 379H.004. APPLICABILITY OF OTHER LAW. A land bank | ||
created under this chapter: | ||
(1) is: | ||
(A) a governmental unit, as defined by Section | ||
101.001, Civil Practice and Remedies Code; | ||
(B) a local government corporation, as defined by | ||
Section 431.003, Transportation Code; and | ||
(C) a public nonprofit corporation that has and | ||
may exercise all of the rights, powers, privileges, authority, and | ||
functions given by the general laws of this state to nonprofit | ||
corporations in this state; | ||
(2) is not: | ||
(A) a program created or operating under Chapter | ||
373 or 374; or | ||
(B) a housing finance corporation created under | ||
Chapter 394; and | ||
(3) must comply with the requirements of Chapters 551 | ||
and 552, Government Code. | ||
Sec. 379H.005. PURPOSE. A land bank created under this | ||
chapter exists for the purpose of acquiring, managing, and | ||
disposing of vacant, abandoned, and deteriorated properties and | ||
returning those properties to productive uses, including | ||
affordable housing, workforce housing, public service housing, | ||
community-based economic development, food desert solutions, | ||
beautification and public art, parks and recreation, flood | ||
reduction and storm resiliency, and other uses necessary and | ||
appropriate to stabilize communities, improve living conditions, | ||
and protect against the displacement of residents of the | ||
municipality served by the land bank. | ||
Sec. 379H.006. CONSTRUCTION. This chapter shall be | ||
construed liberally to carry out the intended purposes as a | ||
complete and independent authorization for the performance of each | ||
and every act and thing authorized by this chapter, and all powers | ||
granted shall be broadly interpreted to carry out the intended | ||
purposes and not as a limitation of powers. Except as otherwise | ||
provided by this chapter, a land bank, in the exercise of its powers | ||
and duties under this chapter and with respect to real property held | ||
by the land bank, has the same amount of control as if the land bank | ||
represented a private property owner, and the land bank is not | ||
subject to restrictions imposed by the charter, ordinances, or | ||
resolutions of a local unit of government. | ||
SUBCHAPTER B. BOARD OF DIRECTORS | ||
Sec. 379H.051. COMPOSITION OF BOARD. The size, membership, | ||
composition, and officers of the board of directors of a land bank, | ||
and methods of appointment to the board, must be established by the | ||
certificate of formation and the bylaws of the land bank. | ||
Sec. 379H.052. ELIGIBILITY FOR MEMBERSHIP. (a) In this | ||
section, "public officer" means an individual who is elected to a | ||
municipal office. | ||
(b) A municipal employee is eligible to serve as a member of | ||
the board, and notwithstanding any law to the contrary, a public | ||
officer is eligible to serve as a member of the board and acceptance | ||
of the appointment will neither terminate nor impair service in the | ||
public office. | ||
Sec. 379H.053. MEETINGS; ATTENDANCE. (a) The board shall | ||
meet in regular session according to a schedule adopted by the | ||
board. | ||
(b) The board may meet in a special session: | ||
(1) convened by the president of the board in | ||
accordance with the bylaws of the board; or | ||
(2) on written notice signed by a majority of the board | ||
members. | ||
(c) The presence of a majority of the board's total | ||
membership constitutes a quorum for any regular or special session. | ||
(d) The board shall establish rules related to the | ||
attendance and participation of members in regular or special | ||
meetings of the board. Rules adopted under this subsection may | ||
provide for the removal from office of a member for failure to | ||
comply with the rules if a majority of the remaining members of the | ||
board vote for the removal. Removal under this subsection takes | ||
effect the first day of the calendar month following the date of the | ||
vote. A person removed under this subsection is ineligible for | ||
reappointment to the board unless reappointment is confirmed | ||
unanimously by the board. | ||
Sec. 379H.054. BOARD ACTIONS. (a) Subject to Subsection | ||
(b), actions of the board must be approved by the affirmative vote | ||
of a quorum of the board. | ||
(b) Action on the following matters requires approval by a | ||
majority of the total membership of the board: | ||
(1) adoption of bylaws or rules for conduct of the | ||
business of the land bank for which the board serves; | ||
(2) hiring or firing of any employee or contractor of | ||
the land bank for which the board serves; | ||
(3) incurring debt; | ||
(4) adoption or amendment of the annual budget; and | ||
(5) sale, lease, encumbrance, or alienation of or | ||
improvements to real or personal property with a value of more than | ||
$50,000. | ||
(c) By majority vote, the board may delegate the hiring and | ||
firing of employees and contractors to a specific officer or | ||
committee of the land bank for which the board serves, under terms | ||
and to the extent specified by the board. | ||
(d) A board member may not vote by proxy. | ||
(e) A board member may request a recorded vote on any | ||
resolution or action of the land bank. | ||
Sec. 379H.055. CONFLICT OF INTEREST. (a) A board member | ||
or employee of a land bank may not: | ||
(1) acquire any direct or indirect interest in real | ||
property of the land bank, in any real property to be acquired by | ||
the land bank, or in any real property to be acquired from the land | ||
bank; or | ||
(2) have any direct or indirect interest in any | ||
contract or proposed contract for materials or services to be | ||
furnished or used by the land bank. | ||
(b) The provisions of the former Texas Non-Profit | ||
Corporation Act (Article 1396-1.01 et seq., Vernon's Texas Civil | ||
Statutes) related to powers, standards of conduct, and interests in | ||
contracts apply to the directors and officers of the land bank. | ||
(c) The board may adopt supplemental rules addressing | ||
potential conflicts of interest and ethical guidelines for board | ||
members and land bank employees. | ||
Sec. 379H.056. COMPENSATION; REIMBURSEMENT. (a) Board | ||
members serve without compensation. | ||
(b) The board may reimburse a member for expenses actually | ||
incurred in the performance of duties on behalf of the land bank. | ||
SUBCHAPTER C. CREATION, OPERATION, AND DISSOLUTION OF LAND BANK | ||
Sec. 379H.101. CREATION OF LAND BANK. (a) The governing | ||
body of a municipality may create a land bank by the adoption of an | ||
ordinance approving the land bank's certificate of formation and | ||
bylaws. | ||
(b) Approval by the governing body of a municipality of the | ||
certificate of formation and bylaws of a corporation created under | ||
Chapter 431, Transportation Code, that will serve as a land bank | ||
under this chapter is sufficient to create a land bank under this | ||
section. | ||
(c) A land bank's certificate of formation and bylaws | ||
approved under this section may not be changed or amended unless the | ||
governing body of the municipality for which the land bank was | ||
created approves the change or amendment by the adoption of an | ||
ordinance. | ||
Sec. 379H.102. GENERAL POWERS OF LAND BANK. (a) A land | ||
bank has all powers necessary to carry out the purposes of this | ||
chapter, including the power to: | ||
(1) adopt, amend, and repeal bylaws for the regulation | ||
of the land bank's affairs and the conduct of the land bank's | ||
business; | ||
(2) sue and be sued in the land bank's own name and | ||
plead and be interpleaded in all civil actions, including actions | ||
to clear title to real property of the land bank; | ||
(3) adopt and alter a seal; | ||
(4) borrow funds necessary for the operation of the | ||
land bank from private lenders, municipalities, this state, and the | ||
federal government; | ||
(5) adopt any policy for procurement that is | ||
recognized under state law and permitted for governmental entities, | ||
including a policy recognized under Chapters 252 and 271 of this | ||
code, Chapter 431, Transportation Code, and Chapters 2254 and 2269, | ||
Government Code; | ||
(6) issue negotiable revenue bonds and notes under | ||
this chapter; | ||
(7) procure insurance or guarantees from this state or | ||
the federal government of the payments of any debts or parts of | ||
debts incurred by the land bank and pay premiums in connection with | ||
those debts; | ||
(8) enter into contracts and other agreements | ||
necessary, incidental, or convenient to the performance of the land | ||
bank's duties and the exercise of the land bank's powers, including | ||
governmental agreements under Subchapter D, Chapter 431, | ||
Transportation Code, or interlocal contracts under Section | ||
791.011, Government Code, for the joint exercise of powers under | ||
this chapter; | ||
(9) enter into contracts and other agreements with the | ||
municipality that created the land bank for the performance of | ||
services in accordance with Chapter 311, Tax Code; | ||
(10) make and execute contracts and other instruments | ||
necessary or convenient to the exercise of the land bank's powers; | ||
(11) procure insurance against losses in connection | ||
with the real property, assets, or activities of the land bank; | ||
(12) invest money of the land bank, at the discretion | ||
of the board, in instruments, obligations, securities, or property | ||
determined proper by the board and name and use depositories for the | ||
land bank's money; | ||
(13) enter into contracts for the management of, | ||
collection of rent from, or sale of real property of the land bank; | ||
(14) design, develop, construct, demolish, | ||
reconstruct, rehabilitate, renovate, relocate, or otherwise | ||
improve real property of the land bank; | ||
(15) set, charge, and collect rents, fees, and charges | ||
for the use of real property of the land bank and for services | ||
provided by the land bank; | ||
(16) finance by loan, grant, lease, or otherwise | ||
refinance, construct, erect, assemble, purchase, acquire, own, | ||
repair, remodel, rehabilitate, modify, maintain, extend, improve, | ||
install, sell, equip, expand, add to, operate, or manage real | ||
property of the land bank and pay the costs of those activities from | ||
the proceeds of loans by persons, corporations, limited or general | ||
partnerships, and other entities; | ||
(17) grant or acquire a license, easement, lease, as | ||
lessor or lessee, or option with respect to real property of the | ||
land bank; | ||
(18) enter into partnerships, joint ventures, and | ||
other collaborative relationships with the municipality that | ||
created the land bank and other public and private entities for the | ||
ownership, management, development, and disposition of real | ||
property of the land bank; | ||
(19) make application directly or indirectly to any | ||
federal, state, county, or municipal government or agency or to any | ||
other public or private source for loans, grants, guarantees, or | ||
other financial assistance in furtherance of the land bank's public | ||
purpose and accept and use the loans, grants, guarantees, or | ||
financial assistance on terms prescribed by that federal, state, | ||
county, or municipal government or agency or other source; | ||
(20) as security for the repayment of any notes or | ||
other obligations of the land bank, pledge, mortgage, convey, | ||
assign, hypothecate, or otherwise encumber any property of the land | ||
bank, including real property, fixtures, personal property, | ||
revenue, and other funds, and execute any lease, trust indenture, | ||
trust agreement, agreement for the sale of the land bank's notes of | ||
other obligation, loan agreement, mortgage, security agreement, or | ||
other agreement necessary or desirable as determined by the land | ||
bank; and | ||
(21) hold title to real property for purposes of | ||
establishing contracts with public and private nonprofit community | ||
land trusts, including long-term lease contracts. | ||
(b) A land bank may not: | ||
(1) exercise the power of eminent domain; or | ||
(2) acquire real property outside the geographical | ||
boundaries of the municipality that created the land bank. | ||
Sec. 379H.103. RESOLUTION OF COMPLEX TITLE QUESTIONS. A | ||
land bank may provide assistance and guidance to owners of real | ||
property for which there are complex, highly divided fractional | ||
interests in the real property because of multigenerational | ||
intestate distributions, unknown heirs, and other interested | ||
parties for whom accurate information cannot be ascertained. | ||
Sec. 379H.104. INTERLOCAL CONTRACTS. (a) A land bank may | ||
enter into an interlocal contract under Section 791.011, Government | ||
Code, with: | ||
(1) a municipality for a program created by the | ||
municipality under Chapter 373 or 374; or | ||
(2) a non-qualifying municipality for the purpose of | ||
the land bank conducting land bank activities on behalf of and | ||
within the geographical boundaries of the non-qualifying | ||
municipality. | ||
(b) Notwithstanding Section 379H.102(b)(2), a land bank may | ||
acquire real property within the geographical boundaries of a | ||
non-qualifying municipality with which it has entered into an | ||
agreement under Subsection (a). | ||
Sec. 379H.105. RECORDS AND REPORTS. (a) A land bank shall | ||
keep accurate minutes of the land bank's meetings and shall keep | ||
accurate records and books of account that conform with generally | ||
accepted principles of accounting and that clearly reflect the | ||
income and expenses of the land bank and all transactions in | ||
relation to the land bank's real property. | ||
(b) A land bank shall maintain and make available for public | ||
review and inspection: | ||
(1) an inventory of all real property held by the land | ||
bank; | ||
(2) a copy of the sale settlement statement for each | ||
real property sold or transferred to a third party; and | ||
(3) a copy of the performance report filed under | ||
Subsection (e). | ||
(c) Not later than the 90th day after the end of the fiscal | ||
year of the municipality that created the land bank, the land bank | ||
shall file with the municipality an annual audited financial | ||
statement prepared by a certified public accountant. | ||
(d) Financial transactions of a land bank are subject to | ||
audit by the municipality that created the land bank. | ||
(e) For purposes of evaluating the effectiveness of a land | ||
bank created under this chapter, a land bank shall submit an annual | ||
performance report to the municipality that created the land bank | ||
not later than November 1 of each year in which the land bank | ||
acquires or sells real property in accordance with this chapter. | ||
Sec. 379H.106. STAFF. (a) A land bank may employ an | ||
executive director, counsel and legal staff, technical experts, and | ||
other agents and employees, permanent or temporary, that the land | ||
bank may require and may determine the qualifications and set the | ||
compensation and benefits of each of those persons. | ||
(b) A land bank may enter into contracts and agreements with | ||
municipalities for staffing services to be provided to the land | ||
bank by those municipalities or for the land bank to provide such | ||
staffing services to those municipalities. | ||
Sec. 379H.107. ADVISORY COMMITTEE AND NEIGHBORHOOD | ||
CONSULTATION. (a) A land bank shall create one or more advisory | ||
committees to consult with and advise the land bank on: | ||
(1) properties within the municipality served by the | ||
land bank that are imposing the greatest harm on neighborhoods and | ||
communities in the municipality; | ||
(2) neighborhood priorities for new uses of those | ||
properties; and | ||
(3) the range of potential transferees of those | ||
properties. | ||
(b) As appropriate to the location of the real property of | ||
the land bank, advisory committee membership and neighborhood | ||
consultations shall include formal and informal | ||
neighborhood-specific community associations, residents' | ||
associations, faith communities, community development | ||
corporations, and anchor institutions. | ||
Sec. 379H.108. DISSOLUTION OF LAND BANK. (a) A land bank | ||
may be dissolved not earlier than the 60th day after the date an | ||
affirmative resolution to dissolve the land bank is approved by | ||
two-thirds of the membership of the board and confirmed by | ||
resolution of the municipality that created the land bank. | ||
(b) Not less than 60 days before the consideration of a | ||
resolution of dissolution by the board, the board shall: | ||
(1) provide to the governing body of the municipality | ||
that created the land bank written notice of the board's intent to | ||
vote on a resolution for dissolution of the land bank; | ||
(2) publish the notice in a local newspaper of general | ||
circulation; and | ||
(3) send the notice by certified mail to the trustee of | ||
any outstanding bonds of the land bank. | ||
(c) On dissolution of the land bank, all real property, | ||
personal property, and other assets and obligations of the land | ||
bank become the assets and obligations of the municipality that | ||
created the land bank. | ||
SUBCHAPTER D. ACQUISITION AND DISPOSITION OF PROPERTY | ||
Sec. 379H.151. TAX EXEMPT STATUS OF LAND BANK PROPERTY. The | ||
real property of a land bank, including real property held by a land | ||
bank under a long-term lease contract with a community land trust, | ||
and the land bank's income and operations are exempt as public | ||
property used for public purposes from all license fees, recording | ||
fees, and all other taxes imposed by this state or by political | ||
subdivisions of this state. | ||
Sec. 379H.152. TITLE HELD BY LAND BANK. All real property | ||
acquired by a land bank must be held in the name of the land bank. | ||
Sec. 379H.153. QUIET TITLE ACTIONS. (a) A land bank may | ||
file an action to quiet title as to any real property in which the | ||
land bank has an interest. For purposes of a quiet title action, | ||
the land bank is considered to be the holder of sufficient legal and | ||
equitable interests and possessory rights to qualify the land bank | ||
as an adequate complainant in the action. | ||
(b) Before filing an action to quiet title, the land bank | ||
shall conduct an examination of title to determine the identity of | ||
all persons and entities possessing a claim or interest in or to the | ||
real property. Service of the complaint to quiet title shall be | ||
provided to the interested parties by the following methods: | ||
(1) by first class mail to an identity and address as | ||
reasonably ascertainable by an inspection of public records; | ||
(2) in the case of occupied real property, by | ||
registered or certified mail addressed to "occupant"; | ||
(3) by posting a copy of the notice on the real | ||
property; | ||
(4) by publication in a newspaper of general | ||
circulation in the municipality in which the property is located; | ||
and | ||
(5) by another method the court may order. | ||
(c) As part of the complaint to quiet title, a land bank | ||
shall file an affidavit identifying all parties potentially having | ||
an interest in the real property and the form of notice provided. | ||
(d) A court hearing an action under this section shall: | ||
(1) schedule a hearing on the complaint not later than | ||
the 90th day after the date of the filing of the affidavit under | ||
Subsection (c); and | ||
(2) issue a final judgment not later than the 120th day | ||
after the date of the filing of the complaint for all matters on | ||
which an answer was not filed by an interested party. | ||
(e) A land bank may join in a single complaint to quiet title | ||
for one or more parcels of real property. | ||
Sec. 379H.154. ACQUISITION OF PROPERTY GENERALLY. (a) A | ||
land bank may acquire real property by gift, devise, transfer, | ||
exchange, foreclosure, purchase, purchase contracts, lease | ||
purchase agreements, installment sales contracts, land contracts, | ||
or transfers from a municipality on terms as agreed by the land bank | ||
and the municipality, or through any other means on terms and in a | ||
manner the land bank considers appropriate. | ||
(b) Notwithstanding any other law to the contrary, a | ||
municipality served by a land bank or a non-qualifying municipality | ||
that has entered into an interlocal contract with a land bank under | ||
Section 379H.104 may transfer to the land bank real property of the | ||
municipality or non-qualifying municipality on terms and according | ||
to procedures determined by the municipality or non-qualifying | ||
municipality. | ||
(c) A land bank may acquire real property from this state, | ||
the municipality served by the land bank, the county in which that | ||
municipality is located, a governmental entity within the county, | ||
the federal government, or an agency or department of the federal | ||
government. | ||
(d) A land bank shall maintain all of its real property in | ||
accordance with the laws and ordinances of the jurisdiction in | ||
which the real property is located. | ||
Sec. 379H.155. ACQUISITION OF FORECLOSED OR SEIZED | ||
PROPERTY. (a) In this section, "taxing unit" has the meaning | ||
assigned by Section 1.04, Tax Code. | ||
(b) A land bank may submit a written bid to acquire real | ||
property at a tax sale conducted in accordance with Section 34.01, | ||
Tax Code. The bid: | ||
(1) must be in an amount not less than the amount | ||
calculated under Section 34.01(b), Tax Code; and | ||
(2) may be submitted in writing in advance of the | ||
auction or tendered in person at the auction. | ||
(c) If the bid submitted under Subsection (b) is the highest | ||
bid received at the sale, the land bank: | ||
(1) shall: | ||
(A) pay in cash the amount of the costs and | ||
expenses as described by Section 33.48, Tax Code, and any penalties | ||
described by Section 33.07 or 33.08, Tax Code; or | ||
(B) remit payment of the amounts described by | ||
Paragraph (A) to the selling officer by check or electronic funds | ||
transfer not later than the seventh calendar day after the date of | ||
the auction; and | ||
(2) is entitled to credit bid that portion of the bid | ||
amount consisting of the amount of the taxes, penalties, other than | ||
penalties described by Sections 33.07 and 33.08, Tax Code, and | ||
interest set forth in the judgment. | ||
(d) A taxing unit that is a party to a judgment of | ||
foreclosure for property sold at auction may request that the | ||
selling officer bid off the property to the taxing unit in the | ||
manner provided by Section 34.01(j), Tax Code, and, if the request | ||
is granted, the transfer to the taxing unit prevails over a bid by | ||
the land bank if the land bank's bid is the only bid sufficient to | ||
satisfy the minimum bid described by Section 34.01(j), Tax Code. | ||
(e) The aggregate amount of all credit bids in a calendar | ||
year shall be considered satisfied by the aggregate expenditure in | ||
that calendar year of an amount equal to or greater than the credit | ||
bid amount, which expenditures are attributable directly and | ||
indirectly to maintenance, rehabilitation, construction, | ||
demolition, and remediation activities. As to any specific tract | ||
of property acquired by the credit bid and transferred by a land | ||
bank to a public entity described by Section 379H.158(a), the | ||
credit bid shall be considered satisfied by that transfer. | ||
(f) A land bank may submit a written request to a taxing unit | ||
at any time for the commencement of tax foreclosure proceedings for | ||
delinquent taxes on real property, other than property legally | ||
owned and occupied. A land bank may not submit a written request to | ||
a taxing unit under this subsection for legally occupied | ||
residential real property unless the property is five or more years | ||
delinquent. | ||
(g) A request submitted under Subsection (f) must include a | ||
commitment to tender a bid in the amount specified under Subsection | ||
(b). On receipt of the written request, the taxing unit, or the | ||
governmental office acting on behalf of the taxing unit, shall | ||
commence enforcement proceedings in accordance with Section 33.41, | ||
Tax Code. | ||
(h) If there is no private third party bid in an amount more | ||
than the bid of the land bank, the real property must be sold to the | ||
land bank. | ||
(i) A sale to a land bank under this section is not a sale to | ||
a taxing unit under Section 34.01(j) or (p) or 34.21, Tax Code. | ||
(j) A land bank may bid an amount higher than the amount | ||
calculated under Section 34.01(b), Tax Code, and if that higher bid | ||
amount is the highest successful bid, the land bank shall pay the | ||
full amount of the bid in cash. | ||
(k) The deed to a land bank vests good and perfect title in | ||
the land bank to the right, title, and interest owned by the | ||
defendants included in the foreclosure judgment, including the | ||
defendants' right to the use and possession of the property, | ||
subject only to the defendants' right of redemption, the terms of a | ||
recorded restrictive covenant running with the land that was | ||
recorded before January 1 of the year in which the tax lien on the | ||
property arose, a recorded lien that arose under that restrictive | ||
covenant that was not extinguished by the judgment foreclosing the | ||
tax lien, and each easement of record as of the date of the sale that | ||
was recorded before January 1 of the year the tax lien arose. | ||
(l) A sale of real property to a land bank under this | ||
section: | ||
(1) extinguishes each lien securing payment of the | ||
delinquent taxes, penalties, and interest against the property and | ||
included in the judgment; and | ||
(2) does not affect the personal liability of any | ||
person for those taxes, penalties, and interest included in the | ||
judgment that are not satisfied from the proceeds of the sale. | ||
(m) A municipality, and any taxing unit levying property | ||
taxes within the geographical jurisdiction of the municipality, may | ||
convey tax foreclosed real property owned by the municipality or | ||
the taxing unit to the land bank on terms and for an amount of | ||
consideration determined by the transferor and the land bank. | ||
(n) A bid submitted by a land bank in accordance with this | ||
section is considered a bid for the amount calculated under Section | ||
34.01(b), Tax Code, and must be received in accordance with Section | ||
34.01(j), Tax Code. | ||
Sec. 379H.156. REDEMPTION BY OWNER OF FORECLOSED PROPERTY. | ||
(a) The owner of real property sold to a land bank under Section | ||
379H.155 may redeem the property in the manner prescribed for | ||
owners of real property sold at a tax sale to a purchaser other than | ||
a taxing unit under Section 34.21, Tax Code. | ||
(b) The price to be paid by the owner of real property sold | ||
to a land bank under this section to redeem the property shall be in | ||
the amounts set forth in Sections 34.21(a) and (e), Tax Code. For | ||
the purposes of calculating the price, the bid paid by the land bank | ||
shall be the aggregate amount of the land bank's bid as described by | ||
Section 379H.155(b). | ||
(c) If the owner of real property sold to a land bank under | ||
Section 379H.155 redeems the property by paying to the land bank the | ||
full amount required to redeem as set forth in Sections 34.21(a) and | ||
(e), Tax Code, the land bank shall: | ||
(1) retain an amount equal to the amount paid in cash | ||
by the land bank in accordance with Section 379H.155; | ||
(2) retain any redemption premium and any reasonable | ||
costs the land bank may have expended on maintenance or | ||
environmental remediation of the property being redeemed; and | ||
(3) remit to the county assessor-collector any | ||
remaining amounts to be distributed among the taxing units that | ||
were parties to the judgment of foreclosure in an amount equal to | ||
the proportion of each taxing unit's taxes, penalties, and interest | ||
due in accordance with the judgment of foreclosure. | ||
Sec. 379H.157. DISPOSITION OF PROPERTY GENERALLY. (a) A | ||
land bank may convey, exchange, sell, transfer, lease as lessor, | ||
grant, release and demise, pledge, or hypothecate any interest in, | ||
on, or to real property of the land bank. | ||
(b) A municipality may, in the ordinance creating a land | ||
bank, require that a particular form of disposition of real | ||
property of the land bank, or any disposition of real property | ||
located within a specified jurisdiction of the municipality, be | ||
subject to specified voting and approval requirements of the board. | ||
Unless restricted under this subsection, the board may delegate to | ||
officers and employees the authority to enter into and execute | ||
agreements, instruments of conveyance, and all other related | ||
documents pertaining to the conveyance of real property by the land | ||
bank. | ||
(c) A land bank shall determine the terms, conditions, form, | ||
and substance of consideration necessary and appropriate to convey, | ||
exchange, sell, transfer, lease as lessor, grant, or mortgage as | ||
mortgagor any interest in, on, or to real property of the land bank. | ||
Consideration may take the form of monetary payments and secured | ||
financial obligations, covenants, and conditions related to the | ||
present and future use of the property, deed covenants and | ||
limitations, contractual commitments of the transferee, mortgage | ||
financing, defeasible fees, and other forms of consideration as | ||
determined by the board to be in the best interests of the land | ||
bank. The board shall determine and state in the land bank's | ||
policies and procedures the general terms for consideration to be | ||
received by the land bank for the transfer of real property of the | ||
land bank. | ||
(d) The board may authorize in the board's policies | ||
governing the disposition of land bank property a program for the | ||
disposition of land bank property to owners of contiguous | ||
properties. | ||
(e) A municipality may recommend that a land bank created by | ||
the municipality, and the land bank may in the land bank's own | ||
policies and procedures, establish a hierarchical ranking of | ||
priorities for the use of real property conveyed by the land bank, | ||
including use for: | ||
(1) purely public spaces and places; | ||
(2) flood reduction, storm water retention and | ||
drainage, and storm resiliency; | ||
(3) affordable housing, workforce housing, or public | ||
service housing; | ||
(4) community-based economic development, including | ||
retail, commercial, and industrial activities; | ||
(5) food desert solutions; | ||
(6) beautification and public art, parks, and | ||
recreation; | ||
(7) conservation areas; and | ||
(8) community land trusts or other public entities. | ||
Sec. 379H.158. DISPOSITION OF PROPERTY FOR FLOOD CONTROL | ||
AND STORM WATER DRAINAGE AND PLANNING. (a) A land bank may convey | ||
to a public entity such as a flood control district or a municipal | ||
parks and recreation department real property held by the land | ||
bank: | ||
(1) for which the highest and best use is flood control | ||
or storm water retention or drainage; and | ||
(2) that, as a result of housing and building code | ||
restrictions, flood plain elevations, other local, state, or | ||
federal laws, or public or private agreements, conditions, and | ||
limitations, is no longer capable of being developed or | ||
redeveloped. | ||
(b) The transfer of real property by a land bank under this | ||
section may be: | ||
(1) by grant, deed lease, or other conveyance and may | ||
include additional limitations, restrictions, and conditions | ||
determined by the land bank; and | ||
(2) for nominal consideration, for consideration | ||
consisting of contractual commitments, for an exchange of real | ||
properties, or for other consideration determined by the land bank. | ||
Sec. 379H.159. AFFORDABLE HOUSING REQUIREMENT. A land bank | ||
created under this chapter shall adopt a policy requiring not less | ||
than 70 percent of real property conveyed for residential purposes | ||
to the land bank be deed restricted for housing that is affordable | ||
to households with an income of not greater than 80 percent of the | ||
area median family income, adjusted for household size, for the | ||
municipality, as determined annually by the United States | ||
Department of Housing and Urban Development, unless otherwise | ||
required by: | ||
(1) the governing body of the municipality for which | ||
the land bank is created; | ||
(2) a source of funding; or | ||
(3) a transferor of an interest in the real property. | ||
SUBCHAPTER E. FINANCING OF LAND BANK OPERATIONS | ||
Sec. 379H.201. GENERAL FINANCING. (a) A land bank may | ||
receive funding through grants and loans from the municipality that | ||
created the land bank, other municipalities, this state, the | ||
federal government, and other public or private sources. | ||
(b) A land bank may receive and retain payments for services | ||
rendered, for rents and leasehold payments received, for | ||
consideration for disposition of real and personal property, for | ||
proceeds of insurance coverage for losses incurred, for income from | ||
investments, and for any other asset or activity permitted under | ||
this chapter. | ||
Sec. 379H.202. SALE OF LAND BANK PROPERTY. At the time a | ||
land bank sells or otherwise disposes of real property, the | ||
proceeds from the sale, if any, shall be allocated to operations and | ||
expenses of the land bank. | ||
Sec. 379H.203. TAX PENALTY FINANCING. The governing | ||
authority of the municipality that created the land bank, and a | ||
taxing unit within the geographical boundaries of the municipality, | ||
may increase the amount of the penalty imposed for the nonpayment of | ||
real property taxes of the municipality levied within that | ||
jurisdiction under Section 33.01, Tax Code, by increasing the | ||
penalty amount on delinquent taxes on July 1, as described by | ||
Section 33.01(a), Tax Code, from 12 percent to 14 percent. The | ||
supplemental penalty authorized by this subsection applies only to | ||
properties not owned and occupied as a residence homestead as | ||
defined by Section 11.13(j)(1), Tax Code. If the supplemental | ||
penalty is authorized and collected, all such supplemental revenue | ||
must be transferred to the land bank. | ||
Sec. 379H.204. COLLECTION OF TAXES ON PROPERTY CONVEYED BY | ||
LAND BANK. Not more than 75 percent of the real property taxes the | ||
municipality that created the land bank collected on real property, | ||
excluding any school district or county ad valorem tax, conveyed by | ||
a land bank under the laws of this state shall be remitted to the | ||
land bank. The real property taxes of any other taxing unit, as to | ||
real property of the land bank, may also be allocated to the land | ||
bank in a similar manner under an interlocal agreement between the | ||
other taxing unit and the land bank. The specific percentage of | ||
those taxes to be remitted shall be established by ordinance, | ||
resolution, or interlocal cooperation agreement of the land bank. | ||
The allocation of property tax revenue shall begin with the first | ||
taxable year following the date of conveyance and shall continue | ||
for a period of five years. The funds shall be remitted to the land | ||
bank in accordance with the administrative procedures established | ||
by the assessor-collector of the county in which the land bank is | ||
located. The allocation of property tax revenue may not occur if | ||
those taxes have been previously allocated to a tax increment | ||
reinvestment zone, or to secure a debt of the municipality or other | ||
taxing unit, unless the municipality or other taxing unit enters | ||
into an agreement with the land bank for the remittance of those | ||
funds to the land bank. Any property tax revenue allocated to the | ||
land bank under this subsection shall be excluded from the | ||
calculation of ad valorem tax revenue under the municipality's | ||
charter. | ||
Sec. 379H.205. ISSUANCE OF BONDS. (a) A land bank may | ||
issue bonds for the land bank's purposes. The principal and | ||
interest of bonds issued under this section are payable from the | ||
land bank's general revenue. Any bonds issued under this section | ||
may be secured by a pledge of any revenue, including grants or | ||
contributions from this state, the federal government, or any | ||
agency or instrumentality of this state or the federal government, | ||
or by a mortgage of any real property of the land bank. | ||
(b) Bonds issued by a land bank are negotiable instruments | ||
under the law. | ||
(c) Bonds of a land bank issued under this section and the | ||
income from those bonds shall at all times be free from taxation for | ||
state or local purposes under any provision of state law. | ||
(d) Bonds issued by a land bank must be authorized by | ||
resolution of the board and shall be limited obligations of the land | ||
bank. A land bank may not issue bonds unless authorized by the | ||
municipality for which the land bank is created. | ||
(e) The principal and interest, costs of issuance, and other | ||
costs incidental to bonds issued under this section shall be | ||
payable solely from the income and revenue derived from the sale, | ||
lease, or other disposition of the assets of the land bank. | ||
(f) In the discretion of the land bank, the bonds may be | ||
additionally secured by mortgage or other security device covering | ||
all or part of the project from which the revenue pledged may be | ||
derived. | ||
(g) Any refunding bonds issued shall be payable from any | ||
source described by this section or from the investment of any of | ||
the proceeds of the refunding bonds, may not constitute an | ||
indebtedness or pledge of the general credit of a municipality or | ||
any other governmental entity within the meaning of any | ||
constitutional or statutory limitation of indebtedness, and must | ||
contain a recital to that effect. | ||
(h) Bonds of the land bank may be issued in the form, may be | ||
in the denominations, may bear interest, may mature in the manner, | ||
and may be executed by one or more members of the board as provided | ||
by the resolution authorizing the issuance of the bonds. The bonds | ||
may be subject to redemption at the option of and in the manner | ||
determined by the board in the resolution authorizing the issuance | ||
of the bonds. | ||
(i) The municipality in which a land bank operates may | ||
guarantee, insure, or otherwise become primarily or secondarily | ||
obligated on the indebtedness of the land bank subject to all other | ||
provisions of state law applicable to municipal indebtedness. | ||
(j) Bonds issued by a land bank shall be issued, sold, and | ||
delivered in accordance with the terms and provisions of a | ||
resolution adopted by the board. The board of a land bank may sell | ||
the bonds in a manner, either at public or at private sale, and for a | ||
price as the board determines to be in the best interests of the | ||
land bank. The resolution issuing bonds shall be published in a | ||
newspaper of general circulation within the jurisdiction of the | ||
land bank. | ||
(k) A board member or a person executing the bonds is not | ||
liable personally on any bonds by reason of the issuance of the | ||
bonds. The bonds or other obligations of the land bank are not a | ||
debt of the municipality that created the land bank or of this state | ||
and must state so on their face. The municipality, this state, or | ||
any revenue or any property of a municipality or this state is not | ||
liable for the bond. | ||
SECTION 2. Section 379E.002, Local Government Code, is | ||
amended to read as follows: | ||
Sec. 379E.002. APPLICABILITY; CONSTRUCTION WITH OTHER LAW. | ||
This chapter applies only to a municipality: | ||
(1) to which Chapter 379C or 379H [ |
||
apply; and | ||
(2) that has not ever adopted a homestead land bank | ||
program under Subchapter E, Chapter 373A. | ||
SECTION 3. Chapter 379D, Local Government Code, is | ||
repealed. | ||
SECTION 4. The Houston Land Bank, a public nonprofit | ||
corporation evidenced by its amended and restated Certificate of | ||
Formation dated September 26, 2018, as filed with the Secretary of | ||
State under File No. 155688901, under ordinance dated HCD 18-51, | ||
approved and adopted by the city council of the City of Houston on | ||
July 25, 2018, and originally created as the Land Assemblage | ||
Redevelopment Authority under Subchapter D, Chapter 431, | ||
Transportation Code, is a land bank under Chapter 379H, Local | ||
Government Code, as added by this Act, and shall continue to possess | ||
the statutory authorization by which it was originally created | ||
under Subchapter D, Chapter 431, Transportation Code. All actions | ||
of the board of directors and employees of the Houston Land Bank, | ||
all contracts, agreements, services, and real property | ||
acquisitions and dispositions taken before the effective date of | ||
this Act shall remain unaffected by the adoption of an ordinance | ||
under Chapter 379H, Local Government Code, as added by this Act. | ||
SECTION 5. This Act takes effect September 1, 2019. |