SB 335

86(R) - 2019
Senate Intergovernmental Relations
House Ways & Means
Senate Intergovernmental Relations
House Ways & Means
Property taxes
Personal Property

Vote Recommendation

  • Neutral
  • Neutral
  • Neutral
  • Neutral
  • Neutral


Royce West


José Rodríguez

Bill Caption

Relating to community land trusts.

Fiscal Notes

Passage of the bill would increase in the amount of property that may be eligible for a community land trust exemption. As a result, taxable property values could be reduced and the related costs to the Foundation School Fund could be increased through the operation of the school finance formulas.

Bill Analysis

A Community Land Trust (CLT) is an affordable housing program that is used to supply permanently affordable homeownership units through resale restrictions recorded in a 99-year ground lease. CLT also refers to the nonprofit organization that runs the CLT program and that retains legal title to the land that is part of the CLT program, and is then leased to the homeowner. The CLT resale formula restricts the resale price of the CLT home and is the mechanism that keeps the home affordable for future homeowners.

SB 335 would expand the definition of entities that may qualify to create community land trusts. It would also provide that exemptions would continue to apply to property located within the taxing unit until the governing body rescinds the exemption by law.

In appraising the value of the land, the chief appraiser would be required to use the income method; take into account the limitations of a property; use the same capitalization rate as used on other rent restricted properties; and restrict the appraisal value if a property value increases due to “eligible land use restrictions.” 

Vote Recommendation Notes

Texas Action remains neutral on SB 335 because it does not affect our liberty principles. However, legislators should well note that this attempt to limit property tax growth and gentrification through non-profits does not address the root problem of skyrocketing property taxes. Rather than gimmicks exercised by nonprofits to help keep urban housing affordable, Texas needs real and permanent property tax reform to provide meaningful tax relief to all current and future homeowners.