A Re-Cap of the Texas 87th Legislative Session - Affordable Housing Initiatives Inch Forward

By Victoria Wilson, TAAHP Policy & Regulatory Manager & Roger Arriaga, TAAHP Executive Director

The 87th Texas legislative session was anything but ordinary. Given an uncertain start during the pandemic, which involved rapidly changing safety protocols and limited public interaction and input, it was not clear what we could expect. What we did know early on, however, is that addressing the hardship caused by both COVID-19 and Winter Storm Uri would be priorities with the added complexity of a constrained budget.

Amid these circumstances TAAHP maintained that housing had a role to play in the economic recovery: without safe, high-quality, affordable housing, families would struggle to rebound after the challenging year that had passed. With this in mind, TAAHP’s focus was on building relationships, advancing legislative priorities with no fiscal impact, supporting legislation that would advance TAAHP’s mission, and limiting legislation harmful to the industry.

A SEAT AT THE TABLE

TAAHP’s Government Affairs Committee, its leadership, lobby team, and staff worked diligently to connect with as many legislators as possible. Collectively, we succeeded by having met with nearly every member of the Senate, every incoming freshman legislator, the Lt. Governor’s, Governor’s and the Speaker’s offices, and many other key members and staff.

These efforts were fruitful not only in educating members on Housing Tax Credits, but also in making TAAHP known as a valuable resource in the affordable housing space. More than any other session, TAAHP was sought out to provide input on housing bills, and offer testimony and support. These relationships and experience are invaluable and will be carried forward for sessions to come.

TAAHP put considerable resources toward advancing HB 2027, which sought to limit restrictions on delivering affordable housing where it is most needed by lifting census tract restrictions, modifying the resolution of no objection (RONO) process, and allowing TDHCA to prioritize scoring items. In the House, opposition from Rep. Swanson led to a significant reduction in the bill. TAAHP launched an education and lobbying campaign that led to its passage by the House, but ultimately expired in the Senate as time ran short.

TAAHP MEMBERS PROVE TO BE A VALUABLE RESOURCE FOR TEXAS LEGISLATORS

Nearly 7,000 bills were filed this session, which is comparable to past sessions. But 15 percent were signed into law – a roughly 22 percent decrease from last session. It was a tough session to pass bills, but affordable housing still garnered some success.

On par with this rate, TAAHP supported 21 bills this session, of which three passed, making it to the Governor’s desk for his signature.

TAAHP members traveled from across the state to testify at congressional hearings and drop cards in support for 10 bills. TAAHP also found success in opposing bills that would have made it more difficult to build affordable housing in the state. A few of the most impactful changes were:

Private Activity Bonds (SB 1984) SB 1984 allows previously designated carryforward bonds to be reassigned to the issuer’s next project application. It will speed-up the processing of these private activity bonds by allowing reassignment of the carryforward designation of these bonds.

Appraisals (HB 3833) This bill expands a previous reduction in the number of years rollback taxes are due to other land uses and eliminates the interest due on rollback taxes. Of special interest to the LIHTC community is the change in the appraisal process for properties that are under construction or have not yet reached stabilized occupancy. In these cases, the expected income and expenses established in the underwriting report will be adjusted to reflect the percentage of construction that is complete or the percentage remaining to achieve stabilized occupancy.

Non-compliance reporting (SB 2046) This bill prohibits the Texas Department of Housing and Community Affairs (TDHCA) from including instances of noncompliance associated with a project in its compliance report if the applicant has demonstrated that the compliance issue in question was delegated to another party. This change means applicants will avoid accumulating demerits, possibly making them ineligible for future tax credits, when they have no control over compliance.

Key Takeaways

TAAHP leadership went above and beyond to build the organization’s reputation and collaborate with other organizations throughout the state, and these efforts proved to be worthwhile. Without a doubt, our membership has been our most valuable advocacy resource.

Many legislators believe in the HTC program’s contribution to quality affordable housing in Texas, yet NIMBY (not in my backyard) sentiment remains strong in some circles. TAAHP is committed to educating our legislators on the amazing work you all do in bringing quality, affordable housing to Texans.

TAAHP’s active involvement during this legislature, both in supporting and opposing bills, yielded results. It is crucial that, with the help our membership, we continue to engage in the legislative process and build relationships to solidify our reputation as the respected voice in the world of affordable housing.