bill tying housing tax credits to a nearby grocery store

The text as introduced · 674 words

89R1962 JG-D

By: Morales of Harris
H.B. No. 492

A BILL TO BE ENTITLED

AN ACT

relating to prohibiting the allocation of low income housing tax

credits for certain developments.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 2306.6703(a), Government Code, is

amended to read as follows:

(a) An application is ineligible for consideration under

the low income housing tax credit program if:

(1) at the time of application or at any time during

the two-year period preceding the date the application round

begins, the applicant or a related party is or has been:

(A) a member of the board; or

(B) the director, a deputy director, the director

of housing programs, the director of compliance, the director of

underwriting, or the low income housing tax credit program manager

employed by the department;

(2) the applicant proposes to replace in less than 15

years any private activity bond financing of the development

described by the application, unless:

(A) at least one-third of all the units in the

development are public housing units or Section 8 project-based

units and the applicant proposes to maintain for a period of 30

years or more 100 percent of the units supported by housing tax

credits as rent-restricted and exclusively for occupancy by

individuals and families earning not more than 50 percent of the

area median income, adjusted for family size;

(B) the applicable private activity bonds will be

redeemed only in an amount consistent with their proportionate

amortization; or

(C) if the redemption of the applicable private

activity bonds will occur in the first five years of the operation

of the development and complies with Section 42(h)(4), Internal

Revenue Code of 1986:

(i) on the date the certificate of

reservation is issued, the Bond Review Board determines that there

is not a waiting list for private activity bonds in the same

priority level established under Section 1372.0321 or, if

applicable, in the same uniform state service region, as referenced

in Section 1372.0231, that is served by the proposed development;

and

(ii) the applicable private activity bonds

will be redeemed according to underwriting criteria, if any,

established by the department;

(3) the applicant proposes to construct a new

development that is located one linear mile or less from a

development that:

(A) serves the same type of household as the new

development, regardless of whether the developments serve

families, elderly individuals, or another type of household;

(B) has received an allocation of housing tax

credits for new construction at any time during the three-year

period preceding the date the application round begins; and

(C) has not been withdrawn or terminated from the

low income housing tax credit program; [ or ]

(4) the development is located in a municipality or,

if located outside a municipality, a county that has more than twice

the state average of units per capita supported by housing tax

credits or private activity bonds, unless the applicant:

(A) has obtained prior approval of the

development from the governing body of the appropriate municipality

or county containing the development; and

(B) has included in the application a written

statement of support from that governing body referencing this

section and authorizing an allocation of housing tax credits for

the development ; or

(5) the development is not located within two miles of

a grocery store .

SECTION 2. The change in law made by this Act applies only

to an application for low income housing tax credits that is

submitted to the Texas Department of Housing and Community Affairs

during an application cycle that is based on the 2026 qualified

allocation plan or a subsequent plan adopted by the governing board

of the department under Section 2306.67022, Government Code. An

application that is submitted during an application cycle that is

based on an earlier qualified allocation plan is governed by the law

in effect on the date the application cycle began, and the former

law is continued in effect for that purpose.

SECTION 3. This Act takes effect September 1, 2025.