88R559 JAM-F     By: Gervin-Hawkins H.B. No. 4858       A BILL TO BE ENTITLED   AN ACT   relating to the allocation of low income housing tax credits.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Sections 2306.6710(b), (f), and (g), 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 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;                      (G) [(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;                      (H) [(I)]  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                      (I) [(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;                (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; and                (4)  for an application concerning a development that   is or will be located in a county with a population of 1 million or   more but less than 4 million and that is or will be located not more   than two miles from a veterans hospital, veterans affairs medical   center, or veterans affairs health care center, encourages   applicants to provide a preference for leasing units in the   development to low income veterans.          (f)  In evaluating the level of community support for an   application under Subsection (b)(1)(I) [(b)(1)(J)], 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.          (g)  If no written statement is received for an application   under Subsection (b)(1)(I) [(b)(1)(J)], the department shall use   the maximum number of points that could have been awarded under that   paragraph to increase the maximum number of points that may be   awarded for that application under Subsection (b)(1)(B). If   awarding points under Subsection (b)(1)(B)(iii), the department   shall reallocate the points from the scoring category provided by   Subsection (b)(1)(I) [(b)(1)(J)] equally between the political   subdivisions described by Subsection (b)(1)(B)(iii).  In awarding   points transferred under this subsection from the scoring category   provided by Subsection (b)(1)(I) [(b)(1)(J)] to the scoring   category provided by Subsection (b)(1)(B), the department shall   award:                (1)  positive points for positive resolutions adopted;                (2)  negative points for negative resolutions adopted;   and                (3)  zero points for neutral resolutions adopted.          SECTION 2.  Section 2306.6711(b), Government Code, is   amended to read as follows:          (b)  Not later than the deadline specified in the qualified   allocation plan, the board shall issue commitments for available   housing tax credits based on the application evaluation process   provided by Section 2306.6710.  The board may not allocate to an   applicant housing tax credits in any unnecessary amount, as   determined by the department's underwriting policy and by federal   law, and in any event may not allocate to the applicant housing tax   credits in an amount greater than $4 [$3] million in a single   application round or to an individual development more than $2   million in a single application round.          SECTION 3.  Section 2306.6725(b), Government Code, is   amended to read as follows:          (b)  The department shall provide appropriate incentives as   determined through the qualified allocation plan to reward   applicants who agree to:                (1)  equip the development that is the basis of the   application with energy saving devices that meet the standards   established by the state energy conservation office; or                (2)  provide to a qualified entity, in a land use   restriction agreement in accordance with Section 2306.6726, a right   of first refusal to purchase the development at the minimum price   provided in, and in accordance with the requirements of, Section   42(i)(7), Internal Revenue Code of 1986 (26 U.S.C. Section   42(i)(7))[; and                [(2)  locate the development in a census tract in which   there are no other existing developments supported by housing tax   credits].          SECTION 4.  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 2024 qualified   allocation plan or a subsequent plan adopted by the governing board   of the department. 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 5.  This Act takes effect September 1, 2023.