The bill amends the definition of "at-risk development" in the Texas Government Code to expand the eligibility criteria for certain developments to receive low-income housing tax credits. Specifically, it adds new categories of federal housing assistance programs, including the Section 8 Housing Assistance Payments Program for New Construction and Substantial Rehabilitation, as well as provisions related to the Housing Act of 1949. Additionally, it clarifies that a development can be considered at-risk regardless of whether it proposes to construct or rehabilitate housing units at the original site or at a different location, provided it meets certain conditions related to opportunity index points or local governmental support.

Furthermore, the bill introduces a new subsection that explicitly states the criteria under which a development is considered at-risk, including the stipulation that the affordability contract is nearing expiration or that the mortgage is eligible for prepayment. The changes in law will apply only to applications for low-income housing tax credits submitted during the 2026 qualified allocation plan cycle or later, with earlier applications governed by the previous law. The act is set to take effect on September 1, 2025.

Statutes affected:
Introduced: Government Code 2306.6702 (Government Code 2306)