2019 Texas Legislature Recap

by Jason Busboom, The Busboom Group

During the recently concluded 2019 Texas Legislature, lawmakers considered more than 7,500 bills and resolutions of which more than 1,400 passed.  The Texas Apartment Association (TAA) actively monitored more than 400 bills of which 68 passed.  Industry-specific issues your TAA lobby team and state volunteer leaders worked on include late fees, property tax reform, school finance reform, lease termination rights, parking, guns, building codes, city fee transparency, and affordable housing. TAA’s team also tracked numerous general business legislation.

First, many thanks to AATC member state representatives Stephanie Klick (R – HD 91) and Craig Goldman (R – HD 97) for the service to Tarrant County and all Texans.  Their commitment to private property rights, low taxes, and pro-business policies ensures that our state’s economy continues to thrive.  Special thanks to State Senator Kelly Hancock (R – SD 9) for sponsoring legislation vital to our industry.  Sen. Hancock is a champion of free enterprise and free people. TAA also worked closely with St. Rep. Nicole Collier (D – HD 95) on several industry-specific bills.

Second, thanks to all AATC members who participated in the 2019 TAA Day at the Capitol and contacted your representatives throughout the session.  Your efforts made a significant difference. Your voice was heard in a big way!

Finally, a big shout out to the TAA lobby team: Chris Newton, David Mintz, Sandy Hoy, and Kyle Jackson.  Their tireless efforts on our behalf ensured that many adverse legislative proposals failed and numerous affirmative legislative initiatives were enacted.

Following is a recap of the significant legislation that impacts our industry.  If you have any questions, please email AATC’s Director of Government Affairs Perry Pillow at ppillow@aatcnet.org or call him at (817) 616-0354. To learn more about the status of specific legislation go to https://www.taa.org/advocacy/issues/

Late Fees – SB 1414 (Effective 09/01/2019):  TAA’s top legislative priority this session:

  • Clarifies current state law that a late fee must be reasonable;
  • Repeals requirement that a fee must be an “estimate of uncertain damage;”
  • Provides that a late fee up to 10% for multifamily (5 or more units) is reasonable;
  • Provides that a late fee up to 12% for 1 to 4-unit properties is reasonable;
  • Late fee can be higher than the above percentages if direct or indirect damages; associated with late payment of rent exceed those amounts;
  • Increases grace period by a day (i.e. if rent is due on 1stlate fee may not be collected until the 4th;
  • Allows residents to request an accounting of the late fees owed; and
  • Clarifies that late fee only applies to any “portion of tenant’s rent” that is late – implication for voucher holders

TAA will incorporate changes into the Blue Moon software prior to September 1. All current late fee provisions in the TAA Lease are valid.  Leases signed or renewed after the effective date must contain new late fee provisions.

Property Tax Reform – SB 2(Effective 01/01/2020): 

  • Limits year over year property tax levy increases for cities, counties, and special districts to 3.5% (currently 8%);
  • Automatic November election if an entity wants to increase by more than 3.5%;
  • Effective for 2020 tax year;
  • Create specialized ARB in counties with more than 1 million population for properties valued at $50 million or more (adjusts for inflation);
  • Eliminates challenges by local governments to the value of an entire property category before an ARB;
  • Enhances the Comptroller’s role in standardizing tax rate calculations and data gathering; and
  • Increases electronic financial disclosures by taxing units

School Finance Reform – HB 3(Effective 09/01/2019): 

  • Increases the state’s share of school funding;
  • Reduces recapture rates for property-wealthy school districts;
  • Lowers the school property tax rate by an average of 8 cents in 2020 And 13 cents in 2021; and
  • Limits year over year property tax levy increases to 2.5%

Family Violence Lease Termination – SB 234(Effective 09/01/2019):

  • Amends family violence lease termination to allow a tenant to provide additional forms of documentation:
    • An emergency order by a magistrate; or
    • Documentation from
      • A licensed health care services provider;
      • A licensed mental health services provider; or
      • A trained family violence shelter advocate

Parking- HB 1002 (Effective 01/01/2020)

  • Provides that a parking permit must be coterminous with a lease

 Death of a Sole Resident – HB 69 (Effective 01/01/2020):

  • Codifies right to terminate the lease upon the death of sole resident upon the later of either:
    • 30 days after the landlord receives written notice from a representative of the deceased’s estate, or
    • Written notice has been provided, the tenant’s belongings have been removed, and the representative has signed an inventory if requested.

Guns – HB 302(09/01/2019)

  • Provides that a landlord may not prohibit a tenant or guest from lawfully having a firearm or ammunition in the:
    • Rental unit;
    • Leased premises;
    • Vehicle in the parking lot; or
    • In other areas necessary to go to and from the rental unit, leased premises, or vehicle
  • Makes such possession a defense to criminal trespass, concealed carry, or open carry prohibitions; and
  • Does not allow weapons to be displayed in a threatening manner

Affordable Housing – HB 1973 (Effective 09/01/2019 for 2020 QAP)

  • If a state representative declines to write a letter in support of a proposed LIHTC development, TDHCA would us the maximum number of points that could have been used to increase the number of points awarded because of a city or county resolution

JP Jurisdiction – SB 2342(Effective 09/01/2020)

  • Increases the jurisdiction of JP courts in civil matters to include disputes up to $20,000
  • Does not affect the handling or prioritization of eviction cases

City Fee Transparency – HB 984 (did not pass)

 Jason Busboom, The Busboom Group, represents AATC on the TAA Legislative Committee.