The bill amends the Finance Code and Local Government Code to establish new regulations for housing finance corporations in Texas. It introduces Section 341.407, which prohibits authorized lenders from making loans to housing finance corporations unless they provide proof of compliance with specific local government code sections. Additionally, it modifies Section 394.031 to define the operational areas of housing finance corporations based on their sponsoring local governments, and it requires resolutions for operations outside these areas. The bill also mandates that housing finance corporations submit annual audit reports to the Texas Department of Housing and Community Affairs for compliance verification regarding exemptions claimed under the law.

Furthermore, the bill clarifies that the exemption from taxes and fees for housing finance corporations applies only if the property is located within the authorized operational area or if approved by the relevant governing bodies. It also sets forth specific audit requirements, including timelines for submission and the necessity for independent auditors. The changes aim to enhance accountability and ensure that housing finance corporations operate within their designated jurisdictions while complying with state regulations. The bill will take effect immediately upon receiving a two-thirds vote or on September 1, 2025, if not.

Statutes affected:
Introduced: Local Government Code 394.031, Local Government Code 394.032, Local Government Code 394.039, Local Government Code 394.9025, Local Government Code 394.903, Local Government Code 394.905 (Local Government Code 394)