Sec. 2306.6726. SALE OF CERTAIN LOW INCOME HOUSING TAX CREDIT DEVELOPMENTS. (a) An owner of a development subject to a right of first refusal under Section 2306.6725 who intends to sell the development at any time after the expiration of the compliance period shall notify the department and the tenants of the development of the owner's intent to sell and, if applicable, shall specifically identify to the department any qualified entity that is the owner's intended recipient of the right of first refusal in the land use restriction agreement.

(a-1) As soon as practicable after receiving notice under Subsection (a), the department shall:

(1) provide to any qualified entity specifically identified under Subsection (a) notice regarding the owner's intent to sell the development; and

(2) post on the department's Internet website the notice described by Subdivision (1).

(b) The owner of a development subject to a right of first refusal under Section 2306.6725 may:

(1) during the first 60-day period after notice is provided under Subsection (a-1), negotiate or enter into a purchase agreement only with a qualified entity that is:

(A) a community housing development organization as defined by the federal HOME investment partnership program; or

(B) controlled by an entity described by Paragraph (A);

(2) during the second 60-day period after notice is provided under Subsection (a-1), negotiate or enter into a purchase agreement with a qualified entity that:

(A) is described by Section 2306.6706;

(B) is controlled by an entity described by Paragraph (A); or

(C) is a tenant organization; and

(3) during the last 60-day period after notice is provided under Subsection (a-1), negotiate or enter into a purchase agreement with any other qualified entity.

(c) Beginning on the 181st day after the date the department posts notice under Subsection (a-1), an owner of a development subject to a right of first refusal under Section 2306.6725 may sell to any purchaser a development to which the right of first refusal applies if a qualified entity does not offer to purchase the development for a price that the department determines to be reasonable.

(c-1) This section applies only to a right of first refusal memorialized in a land use restriction agreement. This section does not authorize a modification of any other agreement between an owner of a development and a qualified entity.

(c-2) The department shall adopt rules and procedures to give effect to the right of first refusal granted by any land use restriction agreement.

(d) In this section:

(1) "Compliance period" has the meaning assigned by Section 42(i)(1), Internal Revenue Code of 1986 (26 U.S.C. Section 42(i)(1)).

(2) "Qualified entity" means an entity described by, or an entity controlled by an entity described by, Section 42(i)(7)(A), Internal Revenue Code of 1986 (26 U.S.C. Section 42(i)(7)(A)).

Added by Acts 1997, 75th Leg., ch. 980, Sec. 49, eff. Sept. 1, 1997. Renumbered from Sec. 2306.673 and amended by Acts 2001, 77th Leg., ch. 1367, Sec. 8.01, eff. Sept. 1, 2001.

Amended by:

Acts 2015, 84th Leg., R.S., Ch. 817 (H.B. 3576), Sec. 5, eff. September 1, 2015.