H.B. No. 3532 amends the Local Government Code to establish new definitions and requirements for multifamily residential developments owned by public facility corporations. The bill introduces definitions for "Rent" and "Rent reduction," clarifying the calculation of rent for income-restricted units, and modifies the definition of "Sponsor" by removing references to school districts. It outlines specific conditions for granting tax exemptions, including the requirement to reserve a percentage of units for lower and moderate-income housing. Additionally, the bill mandates that developments must demonstrate that their rent is significantly lower than market rates to qualify for tax benefits and requires annual compliance audits to ensure adherence to these regulations.

The bill also introduces new compliance and audit requirements, stating that developments are ineligible for certain tax exemptions unless a one-time exemption application is submitted to the Texas Department of Housing and Community Affairs and relevant appraisal districts. It specifies that these changes apply to tax years beginning after the bill's effective date and to developments approved on or after this date, while some provisions will apply retroactively to all multifamily residential developments. The bill is set to take effect immediately upon receiving a two-thirds vote from both houses or on September 1, 2025, if that threshold is not met.

Statutes affected:
Introduced: Local Government Code 303.003, Local Government Code 303.0421, Local Government Code 303.0426 (Local Government Code 303)