S.B. No. 2064
 
 
 
 
AN ACT
  relating to the issuance of state and local government securities,
  including the powers and duties of the Bond Review Board and the
  issuance of private activity bonds.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 1231.062, Government Code, is amended by
  amending Subsection (a) and adding Subsection (d) to read as
  follows:
         (a)  Not later than December [October] 31 of each
  even-numbered year, the board shall submit to the legislature a
  statistical report relating to:
               (1)  state securities; and
               (2)  bonds and other debt obligations issued by local
  governments.
         (d)  The board may enter into a contract for the procurement
  of services related to the collection and maintenance of
  information on the indebtedness of local governments and state
  agencies necessary to prepare the statistical report.
         SECTION 2.  Subsection (c), Section 1231.063, Government
  Code, is amended to read as follows:
         (c)  Not later than February 15 [December 1] of each year,
  the board shall submit the annual study to:
               (1)  the governor;
               (2)  the comptroller;
               (3)  the presiding officer of each house of the
  legislature; and
               (4)  the Senate Committee on Finance and House
  Appropriations Committee.
         SECTION 3.  The heading to Chapter 1372, Government Code, is
  amended to read as follows:
  CHAPTER 1372. PRIVATE ACTIVITY BONDS AND CERTAIN OTHER BONDS
         SECTION 4.  Section 1372.001, Government Code, is amended by
  amending Subdivisions (1) and (2) and adding Subdivisions (1-a),
  (1-b), (4-a), and (8-a) to read as follows:
               (1)  "Additional state ceiling" means authorization
  under federal law for the issuance of bonds that are tax-exempt
  private activity bonds subject to the limits imposed by Section
  146, Internal Revenue Code (26 U.S.C. Section 146), in an amount in
  addition to the state ceiling, including the additional tax-exempt
  private activity bonds authorized by Section 3021 of the Housing
  and Economic Recovery Act of 2008 (Pub. L. No. 110-289).
               (1-a)  "Applicable official" means the state official
  or state agency designated by federal law to allocate a
  miscellaneous bond ceiling or designate bonds entitled to the
  federal subsidy limited by a miscellaneous bond ceiling or, in the
  absence of designation by federal law, the governor.
               (1-b)  "Board" means the Bond Review Board.
               (2)  "Bonds" means all obligations, including bonds,
  certificates, or notes, that are:
                     (A)  authorized to be issued by:
                           (i)  the constitution or a statute of this
  state; or
                           (ii)  the charter of a home-rule
  municipality; and
                     (B)  either:
                           (i)  subject to the limitations of Section
  146, Internal Revenue Code (26 U.S.C. Section 146); or
                           (ii)  with respect to Subchapter D,
  otherwise entitled to a federal subsidy only if designated for the
  exemption, credit, or other subsidy, or allocated a portion of a
  limited amount of obligations for which the exemption, credit, or
  other subsidy is authorized, by this state or an applicable
  official or by an issuer to which this state or the applicable
  official has made an allocation, including exemptions, credits, and
  other subsidies authorized by:
                                 (a)  the Heartland Disaster Tax Relief
  Act of 2008 (Pub. L. No. 110-343), regarding Hurricane Ike disaster
  area bonds;
                                 (b)  the American Recovery and
  Reinvestment Act of 2009 (Pub. L. No. 111-5); or
                                 (c)  any other federal law authorizing
  a federal subsidy.
               (4-a)  "Federal subsidy" means an exclusion of interest
  on a bond from gross income for federal income tax purposes, a
  federal income tax credit associated with a bond, a direct federal
  subsidy of interest on a bond, or any other federally authorized
  financial benefit associated with a bond.
               (8-a)  "Miscellaneous bond ceiling" means the maximum
  amount of bonds of any type that may be issued by issuers in this
  state during a calendar year, or cumulatively, that are entitled to
  a federal subsidy only if designated for the federal subsidy, or
  allocated a portion of a limited amount of bonds other than bonds
  subject to the limits imposed by Section 146, Internal Revenue Code
  (26 U.S.C. Section 146), for which the federal subsidy is
  authorized, by:
                     (A)  this state or the applicable official; or
                     (B)  an issuer to which this state or the
  applicable official has made an allocation.
         SECTION 5.  Section 1372.002, Government Code, is amended by
  amending Subsection (a) and adding Subsection (e) to read as
  follows:
         (a)  For purposes of this chapter, a project is:
               (1)  an eligible facility or facilities that are
  proposed to be financed, in whole or in part, by an issue of
  qualified residential rental project bonds;
               (2)  in connection with an issue of qualified mortgage
  bonds or qualified student loan bonds, the providing of financial
  assistance to qualified mortgagors or students located in all or
  any part of the jurisdiction of the issuer; or
               (3)  an eligible facility or facilities that are [is]
  proposed to be financed, in whole or in part, by an issue of bonds
  other than bonds described by Subdivision (1) or (2).
         (e)  For purposes of Subsection (a)(3), and only for
  applications for the financing of sewage facilities, solid waste
  disposal facilities, and qualified hazardous waste facilities, an
  application under this chapter may include multiple facilities in
  multiple jurisdictions. In such an application, the number of
  facilities may be reduced as needed without affecting their status
  as a project for purposes of the application.
         SECTION 6.  Subsection (a), Section 1372.006, Government
  Code, is amended to read as follows:
         (a)  An application for a reservation under Subchapter B or a
  carryforward designation under Subchapter C must be accompanied by
  a nonrefundable fee in the amount of $500, except that:
               (1)  for projects that include multiple facilities
  authorized under Section 1372.002(e), the application must be
  accompanied by a nonrefundable fee in an amount of $500 for each
  facility included in the application for the project; and
               (2)  for issuers of qualified residential rental
  project bonds the application must be accompanied by a
  nonrefundable fee of $5,000, of which the board shall retain $1,000
  to offset the costs of the private activity bond allocation program
  and the administration of that program and of which the board shall
  transfer $4,000 through an interagency agreement to the Texas
  Department of Housing and Community Affairs for use in the
  affordable housing research and information program as provided by
  Section 2306.259.
         SECTION 7.  Section 1372.022, Government Code, is amended to
  read as follows:
         Sec. 1372.022.  AVAILABILITY OF STATE CEILING TO ISSUERS.
  (a)  If the state ceiling is computed on the basis of $75 per capita
  or a greater amount, before August 15 of each year:
               (1)  28.0 percent of the state ceiling is available
  exclusively for reservations by issuers of qualified mortgage
  bonds;
               (2)  8 percent of the state ceiling is available
  exclusively for reservations by issuers of state-voted issues;
               (3)  2.0 percent of the state ceiling is available
  exclusively for reservations by issuers of qualified small issue
  bonds and enterprise zone facility bonds;
               (4)  22.0 percent of the state ceiling is available
  exclusively for reservations by issuers of qualified residential
  rental project bonds;
               (5)  10.5 percent of the state ceiling is available
  exclusively for reservations by issuers of qualified student loan
  bonds authorized by Section 53B.47 [53.47], Education Code, that
  are nonprofit corporations able to issue a qualified scholarship
  funding bond as defined by Section 150(d)(2), Internal Revenue Code
  (26 U.S.C. Section 150(d)(2)); and
               (6)  29.5 percent of the state ceiling is available
  exclusively for reservations by any other issuer of bonds that
  require an allocation.
         (b)  On and after August 15 [but before September 1], that
  portion of the state ceiling available for reservations becomes
  available for all applications for reservations in the order
  determined by the board by lot. If all applicants for a reservation
  have been offered a portion of the available state ceiling, then the
  board shall grant reservations in the order in which the
  applications for those reservations are received[, subject to
  Section 1372.0321. On and after September 1, that portion of the
  state ceiling available for reservations becomes available to any
  issuer for any bonds that require an allocation, subject to the
  provisions of this subchapter].
         SECTION 8.  Section 1372.026, Government Code, is amended to
  read as follows:
         Sec. 1372.026.  LIMITATION ON AMOUNT OF STATE CEILING
  AVAILABLE TO HOUSING FINANCE CORPORATIONS. (a)  The maximum amount
  of the state ceiling that may be reserved before August 15 by a
  housing finance corporation for the issuance of qualified mortgage
  bonds may not exceed the amount computed as follows:
               (1)  if the local population of the housing finance
  corporation is 300,000 or more, $36 [$22.5] million plus the
  product of the amount by which the local population exceeds 300,000
  multiplied by $40 [$11.25];
               (2)  if the local population of the housing finance
  corporation is 200,000 or more but less than 300,000, $32 [$20]
  million plus the product of the amount by which the local population
  exceeds 200,000 multiplied by $40 [$22.5];
               (3)  if the local population of the housing finance
  corporation is 100,000 or more but less than 200,000, $24 [$15]
  million plus the product of the amount by which the local population
  exceeds 100,000 multiplied by $80 [$50]; or
               (4)  if the local population of the housing finance
  corporation is less than 100,000, the product of the local
  population multiplied by $240 [$150].
         (b)  A housing finance corporation may not receive an
  allocation for the issuance of qualified mortgage bonds in an
  amount that exceeds $40 [$25] million.
         (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 9.  Section 1372.0261, Government Code, is amended
  by amending Subsections (c) and (d) and adding Subsections (e),
  (f), and (g) to read as follows:
         (c)  If a housing finance corporation's utilization
  percentage is less than 80 [95] percent but at least 25 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)  If a housing finance corporation's utilization
  percentage is less than 25 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 25
  percent.
         (f)  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.
         (g)  An issuer that has carryforward available from the state
  ceiling created by the Housing and Economic Recovery Act of 2008
  (Pub. L. No. 110-289) is not restricted by project limits for the
  state ceiling. An issuer who uses the carryforward to issue
  qualified mortgage bonds or mortgage credit certificates is not
  subject to the utilization percentage calculation in determining
  the amount of the issuer's reservation request.
         SECTION 10.  Subsection (b), Section 1372.028, Government
  Code, is amended to read as follows:
         (b)  An issuer may apply for a reservation for a program year
  not earlier than October 5 of the preceding year. An issuer may not
  submit an application for a program year after November 15
  [December 1] of that year.
         SECTION 11.  Subsection (a), Section 1372.035, Government
  Code, is amended to read as follows:
         (a)  The board may not grant a reservation of a portion of the
  state ceiling for a program year before January 2 or after November
  15 [December 1] of that year.
         SECTION 12.  Subsection (a), Section 1372.037, 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)  $40 [$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 $20 [$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 13.  Section 1372.042, Government Code, is amended
  by adding Subsection (e) to read as follows:
         (e)  In addition to any other fees required by this chapter,
  an issuer shall submit to the board a nonrefundable fee in the
  amount of $500 before receiving a carryforward designation under
  Subsection (c).
         SECTION 14.  Subchapter B, Chapter 1372, Government Code, is
  amended by adding Section 1372.045 to read as follows:
         Sec. 1372.045.  RESERVATION, ALLOCATION, AND CARRYFORWARD
  DESIGNATION BY BOARD OF ADDITIONAL STATE CEILING. (a)  The board
  is authorized to establish and administer programs for the
  reservation, allocation, and carryforward designation of
  additional state ceiling in accordance with the federal law that
  establishes the additional state ceiling and, to the extent
  consistent with the federal law, as the board determines will
  achieve the purposes for which the additional state ceiling is
  authorized by federal law.
         (b)  The board may adopt rules and procedures the board
  considers necessary to effectively administer programs authorized
  under this section.
         (c)  The board may prescribe forms and applications as needed
  to effectively implement and administer programs authorized under
  this section.
         (d)  The board may adopt emergency rules in connection with
  the programs authorized under this section when the board
  determines that the emergency rules are necessary for the state to
  obtain the full benefits of the additional state ceiling.
         SECTION 15.  Subchapter C, Chapter 1372, Government Code, is
  amended by adding Section 1372.073 to read as follows:
         Sec. 1372.073.  DESIGNATION BY BOARD OF UNENCUMBERED STATE
  CEILING. Notwithstanding any other provision of this chapter, the
  board on the last business day of the year may assign as
  carryforward to state agencies at their request and in the order
  received any state ceiling that is not reserved or designated as
  carryforward and for which no application for carryforward is
  pending.
         SECTION 16.  Chapter 1372, Government Code, is amended by
  adding Subchapter D to read as follows:
  SUBCHAPTER D. ALLOCATION OF MISCELLANEOUS BOND CEILING
         Sec. 1372.101.  PROGRAM ADMINISTRATION. (a)  The
  applicable official may designate bonds as entitled to a portion of
  a miscellaneous bond ceiling or allocate a portion of a
  miscellaneous bond ceiling to an issuer of bonds:
               (1)  in accordance with the federal law that
  establishes the federal subsidy for which the miscellaneous bond
  ceiling is established; and
               (2)  to the extent consistent with the federal law, as
  the applicable official determines will achieve the purposes for
  which the federal subsidy is authorized by federal law.
         (b)  The board is authorized to administer programs
  established by the applicable official for the allocation of a
  miscellaneous bond ceiling or the designation of bonds entitled to
  the federal subsidy limited by a miscellaneous bond ceiling.
         Sec. 1372.102.  RULES AND PROCEDURES. (a)  Unless otherwise
  provided by law, the board may adopt rules and procedures the board
  considers necessary to effectively administer programs established
  by the applicable official for allocation of a miscellaneous bond
  ceiling or for designating bonds as entitled to the federal subsidy
  limited by the miscellaneous bond ceiling.
         (b)  The board may adopt emergency rules in connection with
  the programs described in Subsection (a) when the board determines
  that the emergency rules are necessary for the state to obtain the
  full benefits of the federal subsidy that is limited by the
  miscellaneous bond ceiling.
         (c)  The board may prescribe forms and applications as needed
  to effectively implement and administer programs described in
  Subsection (a).
         (d)  This section does not prevent an applicable official
  from adopting rules and procedures in connection with the
  allocations and designations when required by federal or state law
  or from administering a program independently of the board.
         Sec. 1372.103.  APPLICATION FEES. In connection with
  programs established by the applicable official for the allocation
  of a miscellaneous bond ceiling or the designation of bonds
  entitled to the federal subsidy limited by a miscellaneous bond
  ceiling, the board may charge an application fee for each
  application it receives under this subchapter.
         SECTION 17.  Section 1372.0235, Government Code, is
  repealed.
         SECTION 18.  Subsection (a), Section 2306.6703, 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 [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];
                     (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.
         SECTION 19.  (a)  In this section, "additional state
  ceiling," "applicable official," and "miscellaneous bond ceiling"
  have the meanings assigned by Section 1372.001, Government Code, as
  amended by this Act.
         (b)  All reservations, allocations, and carryforward
  designations by the Bond Review Board of additional state ceiling
  authorized by Section 3021 of the Housing and Economic Recovery Act
  of 2008 (Pub. L. No. 110-289), and by applicable officials of
  miscellaneous bond ceiling authorized by the Heartland Disaster Tax
  Relief Act of 2008 (Pub. L. No. 110-343), regarding Hurricane Ike
  disaster area bonds, or by the American Recovery and Reinvestment
  Act of 2009 (Pub. L. No. 111-5), before the effective date of this
  Act are validated.
         (c)  An issuer that has carryforward available from
  additional state ceiling authorized by the Housing and Economic
  Recovery Act of 2008 (Pub. L. No. 110-289) is not restricted by the
  project limits for the state ceiling established by Chapter 1372,
  Government Code. An issuer that uses the carryforward to issue
  qualified mortgage bonds or mortgage credit certificates is not
  subject to the utilization percentage calculation established by
  Chapter 1372, Government Code, in determining the amount of the
  issuer's reservation request.
         SECTION 20.  This Act takes effect immediately if it
  receives a vote of two-thirds of all the members elected to each
  house, as provided by Section 39, Article III, Texas Constitution.
  If this Act does not receive the vote necessary for immediate
  effect, this Act takes effect September 1, 2009.
 
 
 
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
         I hereby certify that S.B. No. 2064 passed the Senate on
  May 7, 2009, by the following vote: Yeas 31, Nays 0; and that the
  Senate concurred in House amendment on May 30, 2009, by the
  following vote: Yeas 31, Nays 0.
 
 
  ______________________________
  Secretary of the Senate    
 
         I hereby certify that S.B. No. 2064 passed the House, with
  amendment, on May 27, 2009, by the following vote: Yeas 146,
  Nays 2, one present not voting.
 
 
  ______________________________
  Chief Clerk of the House   
 
 
 
  Approved:
 
  ______________________________ 
              Date
 
 
  ______________________________ 
            Governor