H.B. No. 3404 seeks to regulate municipal and county zoning laws in Texas concerning mixed-use and multifamily residential developments. The bill introduces new provisions under Chapter 211 and adds Chapter 249 to the Local Government Code, defining "mixed-use residential" and "multifamily residential." It mandates that municipalities and counties must permit these developments in zoning classifications that allow for office, commercial, retail, or warehouse uses. Additionally, local governments are prohibited from imposing more restrictive regulations on density, building height, and parking requirements compared to similar non-residential developments. The bill also prevents municipalities and counties from charging fees related to the conversion of buildings to mixed-use or multifamily residential use and allows for civil actions against them for violations.

Moreover, the bill addresses ad valorem tax rates and impact fees, stating that if the Attorney General finds a municipality or county in violation of certain sections of the Local Government Code, they cannot adopt an ad valorem tax rate exceeding their no-new-revenue tax rate for the next three tax years. It clarifies that political subdivisions can only impose impact fees on land within their corporate boundaries or extraterritorial jurisdictions if they comply with the relevant chapter, explicitly stating that no impact fees can be enacted for roadway facilities in the extraterritorial jurisdiction. The new provisions will apply only to mixed-use residential or multifamily residential development projects initiated or building permits submitted on or after the effective date of the Act, September 1, 2025, ensuring no retroactive impact on existing projects or permits.

Statutes affected:
Introduced: Local Government Code 395.011 (Local Government Code 395)