85R10940 JG-D     By: Dutton H.B. No. 2109       A BILL TO BE ENTITLED   AN ACT   relating to the evaluation of applications for certain financial   assistance administered by the Texas Department of Housing and   Community Affairs.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 2306.1114(a), Government Code, is   amended to read as follows:          (a)  Not later than the 14th day after the date an   application or a proposed application for housing funds described   by Section 2306.111 has been filed, the department shall provide   written notice of the filing of the application or proposed   application to the following persons:                (1)  the United States representative who represents   the community containing the development described in the   application;                (2)  members of the legislature who represent the   community containing the development described in the application;                (3)  the presiding officer of the governing body of the   political subdivision containing the development described in the   application;                (4)  any member of the governing body of a political   subdivision who represents the area containing the development   described in the application;                (5)  the superintendent and the presiding officer of   the board of trustees of the school district containing the   development described in the application; and                (6)  any neighborhood organization that is   [organizations] on record with the state or county in which the   development described in the application is to be located and that   has [whose] boundaries containing [contain] the proposed   development site or has a boundary located not more than 10 miles   from the proposed site.          SECTION 2.  Section 2306.6704(b-1), Government Code, is   amended to read as follows:          (b-1)  The preapplication process must require the applicant   to provide the department with evidence that the applicant has   notified the following entities with respect to the filing of the   application:                (1)  any neighborhood organization that is   [organizations] on record with the state or county in which the   development is to be located and that has [whose] boundaries   containing [contain] the proposed development site or has a   boundary located not more than 10 miles from the proposed site;                (2)  the superintendent and the presiding officer of   the board of trustees of the school district containing the   development;                (3)  the presiding officer of the governing body of any   municipality containing the development and all elected members of   that body;                (4)  the presiding officer of the governing body of the   county containing the development and all elected members of that   body; and                (5)  the state senator and state representative of the   district containing the development.          SECTION 3.  Section 2306.6705, Government Code, is amended   to read as follows:          Sec. 2306.6705.  GENERAL APPLICATION REQUIREMENTS. An   application must contain at a minimum the following written,   detailed information in a form prescribed by the board:                (1)  a description of:                      (A)  the financing plan for the development,   including any nontraditional financing arrangements;                      (B)  the use of funds with respect to the   development;                      (C)  the funding sources for the development,   including:                            (i)  construction, permanent, and bridge   loans; and                            (ii)  rents, operating subsidies, and   replacement reserves; and                      (D)  the commitment status of the funding sources   for the development;                (2)  if syndication costs are included in the eligible   basis, a justification of the syndication costs for each cost   category by an attorney or accountant specializing in tax matters;                (3)  from a syndicator or a financial consultant of the   applicant, an estimate of the amount of equity dollars expected to   be raised for the development in conjunction with the amount of   housing tax credits requested for allocation to the applicant,   including:                      (A)  pay-in schedules; and                      (B)  syndicator consulting fees and other   syndication costs;                (4)  if rental assistance, an operating subsidy, or an   annuity is proposed for the development, any related contract or   other agreement securing those funds and an identification of:                      (A)  the source and annual amount of the funds;                      (B)  the number of units receiving the funds; and                      (C)  the term and expiration date of the contract   or other agreement;                (5)  if the development is located within the   boundaries of a political subdivision with a zoning ordinance,   evidence in the form of a letter from the chief executive officer of   the political subdivision or from another local official with   jurisdiction over zoning matters that states that:                      (A)  the development is permitted under the   provisions of the ordinance that apply to the location of the   development; or                      (B)  the applicant is in the process of seeking   the appropriate zoning and has signed and provided to the political   subdivision a release agreeing to hold the political subdivision   and all other parties harmless in the event that the appropriate   zoning is denied;                (6)  if an occupied development is proposed for   rehabilitation:                      (A)  an explanation of the process used to notify   and consult with the tenants in preparing the application;                      (B)  a relocation plan outlining:                            (i)  relocation requirements; and                            (ii)  a budget with an identified funding   source; and                      (C)  if applicable, evidence that the relocation   plan has been submitted to the appropriate local agency;                (7)  a certification of the applicant's compliance with   appropriate state and federal laws, as required by other state law   or by the board;                (8)  any other information required by the board in the   qualified allocation plan; and                (9)  evidence that the applicant has notified the   following entities with respect to the filing of the application:                      (A)  any neighborhood organization that is   [organizations] on record with the state or county in which the   development is to be located and that has [whose] boundaries   containing [contain] the proposed development site or has a   boundary located not more than 10 miles from the proposed site;                      (B)  the superintendent and the presiding officer   of the board of trustees of the school district containing the   development;                      (C)  the presiding officer of the governing body   of any municipality containing the development and all elected   members of that body;                      (D)  the presiding officer of the governing body   of the county containing the development and all elected members of   that body; and                      (E)  the state senator and state representative of   the district containing the development.          SECTION 4.  Section 2306.6710(b), Government Code, is   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 rent levels of the units;                      (F)  the cost of the development by square foot;                      (G)  the services to be provided to tenants of the   development;                      (H)  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)  quantifiable community participation with   respect to the development, evaluated on the basis of written   statements from any neighborhood organization that is    [organizations] on record with the state or county in which the   development is to be located and that has [whose] boundaries   containing [contain] the proposed development site or has a   boundary located not more than 10 miles from the proposed site; and                      (J)  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.          SECTION 5.  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 2018 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 6.  This Act takes effect September 1, 2017.