Austin – Senator Paul Bettencourt (R-Houston) files Senate Bill 805 to repeal the ability of Housing Authorities and any other taxing units ability to use Public Finance Corporations to take Billions of Dollars of multifamily properties off the tax rolls by approving leasehold deals. In the most recent egregious example, the Houston Housing Authority didn’t even hold public meetings, granted 75–99-year tax exemptions, and some only had ten percent of their units set aside for low-income residents.
“I’m appalled that Housing Authorities and taxing authorities have completely abused the statutory authority to create PFCs in a totally nontransparent manner. Therefore, I filed a bill to end the practice immediately as PFC abuse, in the supposed name of traditional public housing, has exploded since the last attempts to reform this process in 2021,” said Senator Bettencourt.
More and more Texans are becoming aware of the egregious & unsubstantiated practices of PFCs around the state. According to Statute, if a housing authority does not set aside at least 20 percent of a property’s units for public housing units, then developers must designate half of the units for persons who earn less than 80 percent of the area median income (AMI). These newly created PFCs are failing to do this. For example, in a recent story reported by The Texan, “Lakeside Place PFC received a tax exemption valued at $48 million, but records showed that in December 2021, about 66 percent of the property had been leased at market rates, not reduced rates.”
“The Houston Housing Authority has taken 5.1 billion dollars of property value off the Harris County tax rolls. Tax rolls in more than one city in Texas are seeing Billions taken off the rolls as well,” he added. “As you can see in the Texan story, these Houston Housing Authority stories are especially preposterous.”
Senator Bettencourt expects to work with Lieutenant Governor Dan Patrick’s office, his Senate colleagues, as well as his legislative colleagues in the House to put an end to these PFC abuses. Representative Jacey Jetton (R-Houston) filed an important PFC Reform Bill yesterday, HB 2071.
“It’s time recognize the not-so-obvious. At best, most of these PFC deals are being done in egregiously opaque settings. The practice of unelected Housing Authority and taxing authority bureaucrats taking BILLIONS of Dollars of property value off the tax rolls, for not only their taxing unit, but also ISDs, Cities, Counties, and Special Districts, has to end. This process completely bypasses Elected Officials and that has to change! Concluded Sen. Bettencourt.
A recent Texan story highlights the problem and the dramatic consequences for taxpayers.