HBA-LCA C.S.H.B. 3326 76(R)BILL ANALYSIS Office of House Bill AnalysisC.S.H.B. 3326 By: Gallego Urban Affairs 4/27/1999 Committee Report (Substituted) BACKGROUND AND PURPOSE The Texas Department of Housing and Community Affairs (department) allocates federal Community Development Block Grant funds on a regional basis to ensure their equitable distribution throughout the state. Funds from state housing-finance programs, however, are not distributed under the same guidelines, which may cause discrepancies in the distribution of funds to different areas of the state. C.S.H.B. 3326 amends Chapter 2306, Government Code, to require the department to use a formula for calculating its housing-finance funds according to the need for housing assistance, and provides that excess funds available in a uniform state service region may be used for set-asides. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 2306.111, Government Code, by adding Subsections (d), (e), and (f), as follows: (d) Requires the Texas Department of Housing and Community Affairs (department) to allocate housing funds provided to the state under the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. Section 12701 et seq.), housing trust funds administered by the department under Sections 2306.201-2306.206, Government Code (Housing Trust Fund: Use of Housing Trust Fund; Rules Regarding Administration of Housing Trust Fund; Independent Audit of Housing Trust Fund; Transfer of Money to Housing Trust Fund; Housing Trust Fund not Subject to Texas Trust Code, respectively), and commitments issued under the federal low-income housing tax credit program administered by the department under Sections 2306.671-2306.678, Government Code (Deadlines for Allocation of Low Income Housing Tax Credits; Scoring of Applications; Sale of Certain Low Income Housing Tax Credit Property; Fees; Public Information and Hearings on Program, respectively) to each uniform state service region based on a formula developed by the department that is based on the need for housing assistance, provided that such allocations are consistent with applicable federal and state requirements and limitations. Requires the department, if it determines under the formula that an insufficient number of eligible applications for assistance out of funds and credits allocable under this subsection are submitted to the department from a particular uniform state service region, to use the excess funds and credits to that region for other set-asides. (e) Requires the department to include in its annual low income housing plan under Section 2306.0721 (Low Income Housing Plan) the formula established under this Subsection (d), and the allocation targets established under that formula for each uniform state service region. (f) Requires the department to include in its annual low-income housing report under Section 2306.072 (Annual Low Income Housing Report) the amounts of funds and credits allocated to each uniform state service region in the preceding year for each federal and state program affected by the requirements of Subsection (d). SECTION 2. Effective date: September 1, 2000. SECTION 3. Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE The substitute replaces the original caption "relating to the allocation of programs maintained by the Texas Department of Housing and Community Affairs to the state planning regions based on population" with "relating to the allocation of funding for certain programs maintained by the Texas Department of Housing and Community Affairs to the uniform state service regions." The substitute modifies the original in SECTION 1, as follows: Deletes proposed Section 236.0021, Government Code (Housing Assistance Allocation), relating to the allocation of funds by the Texas Department of Housing and Community Affairs (department), for a program administered by its housing finance division, to each geographic planning region (region) established under Chapter 391, Local Government Code (Regional Planning Commissions), and to develop and use a formula proportionately based on the number of qualified households in each region. SECTION 1 of the substitute amends Section 2306.111, Government Code, by adding new: Subsection (d), to require the department to allocate certain specified funds and commitments to each region, and to use a need-based allocation formula in compliance with applicable federal and state requirements and limitations, and providing that in the event of insufficient applicants from one region, those excess funds and credits shall be used for other set-asides; Subsection (e), to include in the department's low-income housing plan that formula and established allocation targets; and Subsection (f), to include in its low-income housing report the amounts of funds and credits allocated to each region in the preceding year for each state and federal program affected by the requirements of Subsection (d).