H.B. No. 3311
 
 
 
 
AN ACT
  relating to the scoring criteria for an application for a low income
  housing tax credit and the allocation of those credits to
  developments reserved for elderly persons.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.
    Sections 2306.6710(b) and (f), Government Code,
  are amended to read as follows:
         (b)  If an application satisfies the threshold criteria, the
  department shall score and rank the application using a point
  system that:
               (1)  prioritizes in descending order criteria
  regarding:
                     (A)  financial feasibility of the development
  based on the supporting financial data required in the application
  that will include a project underwriting pro forma from the
  permanent or construction lender;
                     (B)  quantifiable community participation with
  respect to the development, evaluated on the basis of a resolution
  concerning the development that is voted on and adopted by the
  following, as applicable:
                           (i)  the governing body of a municipality in
  which the proposed development site is to be located;
                           (ii)  subject to Subparagraph (iii), the
  commissioners court of a county in which the proposed development
  site is to be located, if the proposed site is to be located in an
  area of a county that is not part of a municipality; or
                           (iii)  the commissioners court of a county
  in which the proposed development site is to be located and the
  governing body of the applicable municipality, if the proposed site
  is to be located in the extraterritorial jurisdiction of a
  municipality;
                     (C)  the income levels of tenants of the
  development;
                     (D)  the size and quality of the units;
                     (E)  [the commitment of development funding by
  local political subdivisions;
                     [(F)]  the rent levels of the units;
                     (F) [(G)]  the cost of the development by square
  foot;
                     (G) [(H)]  the services to be provided to tenants
  of the development;
                     (H) [(I)]  whether, at the time the complete
  application is submitted or at any time within the two-year period
  preceding the date of submission, the proposed development site is
  located in an area declared to be a disaster under Section 418.014;
                     (I) [(J)]  quantifiable community participation
  with respect to the development, evaluated on the basis of written
  statements from any neighborhood organizations on record with the
  state or county in which the development is to be located and whose
  boundaries contain the proposed development site; and
                     (J) [(K)]  the level of community support for the
  application, evaluated on the basis of a written statement from the
  state representative who represents the district containing the
  proposed development site;
               (2)  uses criteria imposing penalties on applicants or
  affiliates who have requested extensions of department deadlines
  relating to developments supported by housing tax credit
  allocations made in the application round preceding the current
  round or a developer or principal of the applicant that has been
  removed by the lender, equity provider, or limited partners for its
  failure to perform its obligations under the loan documents or
  limited partnership agreement; and
               (3)  encourages applicants to provide free notary
  public service to the residents of the developments for which the
  allocation of housing tax credits is requested.
         (f)  In evaluating the level of community support for an
  application under Subsection (b)(1)(J) [(b)(1)(K)], the department
  shall award:
               (1)  positive points for positive written statements
  received;
               (2)  negative points for negative written statements
  received; and
               (3)  zero points for neutral statements received.
         SECTION 2.  Section 2306.6711, Government Code, is amended
  by adding Subsections (h) and (i) to read as follows:
         (h)  Notwithstanding Section 2306.6710(d), and except as
  necessary to comply with the nonprofit set-aside required by
  Section 42(h)(5), Internal Revenue Code of 1986 (26 U.S.C. Section
  42(h)(5)), the board may not allocate to developments reserved for
  elderly persons and located in an urban subregion of a uniform state
  service region a percentage of the available housing tax credits
  allocated to developments located in that subregion that is greater
  than the percentage that results from the following formula, unless
  there are no other qualified applicants in that region:
  MP = [(LEH - ERU)/(TLH - TEU)] X 100
  where:
         "MP" is the maximum percentage of the available housing tax
  credits allocated to developments in the subregion that may be
  allocated to developments reserved for elderly persons;
         "LEH" is the number of low income elderly households in the
  subregion;
         "ERU" is the number of existing units reserved for elderly
  persons in developments located in the subregion that already
  receive housing tax credits;
         "TLH" is the total number of low income households in the
  subregion; and
         "TEU" is the total number of existing units in developments
  located in the subregion that already receive housing tax credits.
         (i)  Subsection (h) applies only to a uniform state service
  region that contains a county with a population of more than one
  million.
         SECTION 3.  Section 2306.6725, Government Code, is amended
  by amending Subsections (a) and (d) and adding Subsections (e) and
  (f) to read as follows:
         (a)  In allocating low income housing tax credits, the
  department shall score each application using a point system based
  on criteria adopted by the department that are consistent with the
  department's housing goals, including criteria addressing the
  ability of the proposed project to:
               (1)  provide quality social support services to
  residents;
               (2)  demonstrate community and neighborhood support as
  defined by the qualified allocation plan;
               (3)  consistent with sound underwriting practices and
  when economically feasible, serve individuals and families of
  extremely low income by leveraging private and state and federal
  resources, including federal HOPE VI grants received through the
  United States Department of Housing and Urban Development;
               (4)  serve traditionally underserved areas;
               (5)  demonstrate support from local political
  subdivisions based on the subdivisions' commitment of development
  funding;
               (6)  remain affordable to qualified tenants for an
  extended, economically feasible period; and
               (7) [(6)]  comply with the accessibility standards
  that are required under Section 504, Rehabilitation Act of 1973 (29
  U.S.C. Section 794), and specified under 24 C.F.R. Part 8, Subpart
  C.
         (d)  For each scoring criterion, the department shall use a
  range of points to evaluate the degree to which a proposed project
  satisfies the criterion. The department may not award:
               (1)  a number of points for a scoring criterion that is
  disproportionate to the degree to which a proposed project complies
  with that criterion; or
               (2)  to a proposed project for the general population a
  number of points for a scoring criterion that is different than the
  number of points awarded for that criterion to a proposed project
  reserved for elderly persons if the proposed projects comply with
  the criterion to the same degree.
         (e)  In establishing for the 2016 and 2017 qualified
  allocation plans the scoring criterion related to the commitment of
  development funding by local political subdivisions, the
  department shall significantly reduce for each place regardless of
  population the amount in funding, per low income unit, that is
  required for a proposed project to receive the applicable number of
  points for that criterion. After the reduction, the amount of
  required funding may be a de minimis amount.
         (f)  Subsection (e) and this subsection expire September 1,
  2019.
         SECTION 4.  (a)  The change in law made by this Act to
  Section 2306.6711, Government Code, applies only to the allocation
  of low income housing tax credits for an application cycle that
  begins on or after the effective date of this Act. The allocation
  of low income housing tax credits for an application cycle that
  begins before the effective date of this Act 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.
         (b)  The change in law made by this Act to Sections 2306.6710
  and 2306.6725, Government Code, 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 5.  This Act takes effect September 1, 2015.
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
 
         I certify that H.B. No. 3311 was passed by the House on May 8,
  2015, by the following vote:  Yeas 123, Nays 19, 2 present, not
  voting; and that the House concurred in Senate amendments to H.B.
  No. 3311 on May 28, 2015, by the following vote:  Yeas 128, Nays 16,
  2 present, not voting.
 
  ______________________________
  Chief Clerk of the House   
 
         I certify that H.B. No. 3311 was passed by the Senate, with
  amendments, on May 26, 2015, by the following vote:  Yeas 28, Nays
  3.
 
  ______________________________
  Secretary of the Senate   
  APPROVED: __________________
                  Date       
   
           __________________
                Governor