Relating to housing finance corporations and to the location of residential developments owned by those corporations.

89(R) HB 1585 - Engrossed version - Bill Text

89R18654 JAM-D

By: Bell of Montgomery, Gates, Cook, et al.

H.B. No. 1585

A BILL TO BE ENTITLED

AN ACT

relating to housing finance corporations and to the location of

residential developments owned by those corporations.

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

SECTION 1. Section 394.032(e), Local Government Code, is

amended to read as follows:

(e) A housing finance corporation may delegate to the Texas

Department of Housing and Community Affairs the authority to act on

its behalf in the financing, refinancing, acquisition, leasing,

ownership, improvement, and disposal of home mortgages or

residential developments, within [
and outside
] the jurisdiction of

the housing finance corporation, including its authority to issue

bonds for those purposes.

SECTION 2. Section 394.039, Local Government Code, is

amended to read as follows:

Sec. 394.039. SPECIFIC POWERS RELATING TO FINANCIAL AND

PROPERTY TRANSACTIONS. A housing finance corporation may:

(1) lend money for its corporate purposes, invest and

reinvest its funds, and take and hold real or personal property as

security for the payment of the loaned or invested funds;

(2) mortgage, pledge, or grant security interests in

any residential development, home mortgage, note, or other property

in favor of the holders of bonds issued for those items;

(3)
subject to Section 394.905(c),
purchase, receive,

lease, or otherwise acquire, own, hold, improve, use, or deal in and

with real or personal property or interests in that property,

[
wherever the property is located,
] as required by the purposes of

the corporation or as donated to the corporation; and

(4) sell, convey, mortgage, pledge, lease, exchange,

transfer, and otherwise dispose of all or part of its property and

assets.

SECTION 3. Section 394.903, Local Government Code, is

amended to read as follows:

Sec. 394.903. LOCATION OF RESIDENTIAL
DEVELOPMENTS

[
DEVELOPMENT
];
TRANSFER OF
[
RESIDENTIAL DEVELOPMENT
] SITES. (a)

A residential development
subject to
[
covered by
] this chapter must

be located within the
boundaries of the
local government
that

formed the housing finance corporation that owns the development
.

(b) The local government may transfer any residential

development site to a housing finance corporation by sale or lease.

The governing body of the local government may authorize the

transfer by resolution without submitting the issue to the voters

and without regard to the requirements, restrictions, limitations,

or other provisions contained in any other general, special, or

local law. The site
location is subject to the requirements of this

chapter
[
may be located wholly or partly inside or outside the local

government
].

SECTION 4. Section 394.905, Local Government Code, is

amended to read as follows:

Sec. 394.905. EXEMPTION FROM
TAXES AND FEES
[
TAXATION
].

(a)
The housing finance corporation, all property owned by it, the

income from the property, all bonds issued by it, the income from

the bonds, and the transfer of the bonds are exempt, as public

property used for public purposes, from license fees, recording

fees, and all other taxes imposed by this state or any political

subdivision of this state.

(b)
The corporation is exempt from the franchise tax imposed

by Chapter 171, Tax Code, only if the corporation is exempted by

that chapter.

(c)

Notwithstanding Subsections (a) and (b), a residential

development owned by a housing finance corporation is exempt from

taxes imposed by this state or a political subdivision of this state

only if the development is located within the boundaries of the

local government that formed the corporation.

SECTION 5. Section 394.905(c), Local Government Code, as

added by this Act, applies only to a tax or fee to be imposed on a

housing finance corporation with respect to a newly built

residential development for which a certificate of occupancy is

issued on or after the effective date of this Act or with respect to

any other residential development that is acquired by the

corporation on or after the effective date of this Act.

SECTION 6. 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, 2025.