Commercial Webinar o 1 hour presentation o Questions will be answered at the end. o For technical...

• Commercial Webinar

o 1 hour presentation

o Questions will be answered at the end.

o For technical questions, call 800-263-6317.

Commercial WebinarCommercial WebinarTexas Legislature and Real Estate Texas Legislature and Real Estate

Instructed byInstructed by

Andrew Cates,Andrew Cates, Associate CounselAssociate Counsel

March 28, 2013March 28, 2013

OutlineOutline

• Overview of Legislative Process• How many bills are we following? • How to stay informed• Key Issues • Commercial bills

I. Overview of I. Overview of Legislative ProcessLegislative Process

•What is it? • How does it work?•When does it occur? • How long is it?• Regular v. Special


•What is it?

oGenerally, session is the period of time in which a legislature is convened for the purpose of lawmaking.


• How does it work?

o The Legislature is the lawmaking body of the State of Texas. It consists of two chambers, the house of representatives and the senate.

SENATESENATEHOUSEHOUSE

Bill introduced, read 1st time, and referred to committee by

Speaker

Bill introduced, read 1st time, and referred to committee by

Speaker

Committee studies bill, posts notice of hearing, holds public

hearing or acts in formal meeting resulting in

Committee studies bill, posts notice of hearing, holds public

hearing or acts in formal meeting resulting in

Favorable report withFavorable

report withUnfavorable

reportUnfavorable

report

Substitute or

Amendment

Substitute or

Amendment

No Amendmen

t

No Amendmen

t

Bill may be revived by

minority report on motion adopted by

majority vote of House



majority vote of House

Engrossed bill received, read 1st time, and referred to

committee by Lt. Governor

Engrossed bill received, read 1st time, and referred to

committee by Lt. Governor

Committee studies bill, posts notice of public hearing,

holds public hearing resulting in

Committee studies bill, posts notice of public hearing,

holds public hearing resulting in

Unfavorable report

Unfavorable report

Favorable report with

Favorable report with

Substitute or

Amendment

Substitute or

Amendment

No Amendmen

t

No Amendmen

t



majority vote of Senate



majority vote of Senate

Bill printed on committee report and distributed (1st printing)

Bill printed on committee report and distributed (1st printing)

Bill goes to Calendars Committee for assignment to a calendar

Bill goes to Calendars Committee for assignment to a calendar

Bill printed and distributedBill printed and distributed

Bill brought up for consideration on floor by 2/3 vote of Senate to

suspend rules

Bill brought up for consideration on floor by 2/3 vote of Senate to

suspend rules

2nd reading, debate, amendment by majority vote and passage to 3rd reading


3rd reading, debate, amendment by 2/3 vote and final passage by

House


House

House refuses to concur, requests

appointment of Conference Committee

House refuses to concur, requests

appointment of Conference Committee

House concurs in Senate

amendment on motion adopted by majority vote

House concurs in Senate

amendment on motion adopted by majority vote



If amended, returned to House as amended

If amended, returned to House as amended

If not amended

If not amended

House engrossed text with Senate amendments printed and distributed (2nd Printing)

House engrossed text with Senate amendments printed and distributed (2nd Printing)

Amendments are engrossed into text of bill

Amendments are engrossed into text of bill


Senate


Senate

Senate grants request for Conference Committee

(committee consists of 5 members from

each house)

Senate grants request for Conference Committee

(committee consists of 5 members from

each house)

Signed by Speaker Signed by in presence of House Lt. Governor in

Presence of Senate

Signed by Speaker Signed by in presence of House Lt. Governor in

Presence of Senate

Sent to GovernorSent to

Governor

Conference Committee report filed and adopted without change by each house (report limited to matters in disagreement between the 2 houses)

Conference Committee report filed and adopted without change by each house (report limited to matters in disagreement between the 2 houses)

Bill Enrolled Bill Enrolled

Governor signs billGovernor signs bill

Governor refuses to sign bill

Governor refuses to sign bill

Governor vetoes billGovernor vetoes bill

Bill does not become lawBill does not become law

Veto overridden by 2/3 vote of House and

Senate

Veto overridden by 2/3 vote of House and

Senate

Bill becomes law

Bill becomes law


•When does it occur? o The Legislature meets in regular session

on the second Tuesday in January of each odd-numbered year.

o Currently, we are in the 83rd Regular Session, which started on Tuesday January 8, 2013.


• How long is it?

o The Texas Constitution limits the regular session to 140 calendar days.


• Regular v. Specialo Regular session

• As previously discussed, regular session is the period during which the legislature meets. The regular session convenes every 2 years and may not last more than 140 days.

o Special session (called session)• A special session must be called by the governor

and may last no more than 30 days.

II. Bill Tracking II. Bill Tracking • How many bills were filed this

session?

o 2013 - 6,001o 2011 - 6,304

II. Bill Tracking II. Bill Tracking • How many is TAR following?

o 2013 - 1,852 (the # is still growing)

o 2011 - 2,449

II. Bill Tracking II. Bill Tracking

• How do you track a bill?

• http://www.tlc.state.tx.us/gtli/home.html

III.III. Stay InformedStay Informed• Attend Hill Visits – April 9th

• Sign up for the Legislative Liaisono TexasRealtors.com/Liaison

• Sign up for the Commercial Update1. Sign in at texasrealtors.com2. Click on “Account/profile settings”3. Click on “Email subscriptions” on the far left column4. Check “Commercial issues” 5. Click “Save”

• Visit Texas Legislature Onlineo http://www.tlc.state.tx.us/gtli/home.html

• View Guide to TX Legislative Information o http://www.tlc.state.tx.us/gtli/home.html

2013 Texas 2013 Texas REALTORREALTOR®® Hill Visits Hill Visits • Don’t forget about Hill Visits on April 9th!

o 8:30 am - 9:30 am – Special Commercial Briefing at TAR for commercial real estate practitioners featuring:• Rep. Rob Orr (R-Burleson), • Sen. Kevin Eltife (R-Tyler), and • TAR’s Legislative Director Daniel Gonzalez

o 10:30 am – Hill Visits begin• Commercial brokers will follow their local associations’ meeting

schedule.

o 11:30 am -1:30 pm – Lunch at TAR • Lunch tickets must be purchased in advance through registration

form.

• NOTE: Limited seating, registration required

IV.IV.Key Issues Key Issues

• What are the key issues?• Transportation • Energy • Water • Appraisal reform: CADs• Sales price disclosure• Sales tax on real estate transactions• Property tax lenders

IV.IV.Key Issues Key Issues • Transportation • What are the issues? • In order to ensure a safe and efficient transportation

system, the following must be addressed:• congestion, • capacity, • construction and maintenance costs,• safety, • age and condition of roadways, and • the impact transportation delays have on air quality,

costs of goods, and quality of life.

IV.IV.Key Issues Key Issues • Transportation

• What does this mean for real estate?• An insufficient transportation network:

• impedes commerce,• Increases the costs of goods and services,• creates air quality issues,• limits viable housing options, and• and decreases the quality of life.

IV.IV.Key Issues Key Issues • Transportation • What is our position?

• The Texas Association of REALTORS® supports the following:

1. a statewide, multi-modal transportation system that facilitates safe and efficient movement of people and goods, including sufficient transportation choices, such as roads, freight and passenger rail, waterways, sea and inland ports, and air,



2. dedicated, permanent, sustainable funding sources should be grated to the state’s transportation funds, including the Texas Mobility Fund and the Rail Relocation Fund,

3. all non-education diversions from the state gasoline tax should cease, and



4. the Texas Transportation Commission should endure accountability, transparency, and public involvement in the planning process.

IV.IV.Key Issues Key Issues • Energy• What are the issues? • The costs of energy (natural gas, electricity, and

gasoline) have increased over the past several years, and Texans have had to dedicate a growing portion of their household income toward these costs.

• Texas companies also need adequate, reliable, and reasonably priced energy.

• Without access to energy, the economic prosperity of Texas and its citizens is threatened.

IV.IV.Key Issues Key Issues • Energy• What does this mean for real estate?

• With the population of Texas expected to nearly double by 2060, lawmakers must find ways to support expansion of the energy system to ensure availability, reliability, and affordability for future generations.

• Without expansion of current capacity and development of other generation sources, inadequacy in the current electric system during peak usage will lead to brownouts and blackouts. A state that can’t provide adequate and reliable energy to consumers will not be able to support population growth or the expansion of business and manufacturing in the state, which would dramatically affect the vitality of the real estate industry in Texas.

IV.IV.Key Issues Key Issues •Energy• What is our position? • The Texas Association of REALTORS®

supports the following:1. the establishment of a comprehensive statewide

energy policy,2. the movement toward non-polluting energy

sources,

IV.IV.Key Issues Key Issues • Energy• What is our position?

• The Texas Association of REALTORS® supports the following:o having the state evaluate the effectiveness of

deregulation and regulation of the electric industry, encourage the expansion and addition of electric generation capacity, and provide incentives for consumer compliance with voluntary green standards for homes and businesses, and

o maintaining the electric system independence to ensure system reliability.

IV.IV.Key Issues Key Issues • Water• What are the issues?

• In serious drought conditions, Texas does not and will not have enough water to meet needs of the people, businesses, and agricultural enterprises.

• The Texas Water Development Board (TWDB) estimated that more than 50% of the projected population (it is estimated that the population will increase approx. 82% by 2060, from 25 million to 46.3 million) will not have enough water during drought conditions.

• There is no dedicated state funding source to pay for strategies and projects identified by TWDB to meet the state’s growing need.

• The strategies and projects identified in the current water plan are estimated to cost about $53 billion.

IV.IV.Key Issues Key Issues • Water• What does this mean for real estate?

• The availability of water supports the economic growth and settlement patterns of the state. Hence, if Texas can’t secure clean and reliable water supplies to meet the demands of its growing population, the growing population will turn into a diminishing population.

• As a result, businesses will relocate or not consider Texas as a viable option for investment or expansion.

• Economic losses from not meeting water supply needs could result in a reduction in income and loss of jobs.

• Landowners must also be able to rely on secure private property rights as the state looks to ensure water availability through management and conservation.

IV.IV.Key Issues Key Issues • Water• What is our position?


1. funding the state water plan,2. finding financial resources to ensure a safe and

abundant water supply for future generations, and 3. having groundwater conservation districts balance the

rights of permit holders with the needs of the area the district serves. Such districts should be required to apply rules and regulations consistently and fairly.

IV.IV.Key Issues Key Issues • Appraisal reform: Central appraisal

districts• What are the issues?• Many commercial and residential property owners

believe the appraisal and protest processes are not transparent, fair, or uniform across central appraisal districts (CADs).

• The appraisal process and local taxing jurisdictions’ budget processes have become increasingly convoluted and difficult to understand.


districts

• What does this mean for real estate?• A transparent and improved appraisal

process for commercial and residential property means a more stable and reliable real estate market.


districts• What is our position?

• The Texas Association of REALTORS® supports legislation that:

1. changes how an effective tax rate is calculated to ensure no new revenue is realized by local taxing jurisdictions when local property values increase,

2. repeals the petition requirement before a rollback election for a city or county is held, and

3. repeals Section 41A.031 of the Tax Code (expedited arbitration) for property tax appeals.

IV.IV.Key Issues Key Issues • Sales price disclosure• What are the issues? • Some appraisal districts, cities, and counties argue for full

disclosure of all real estate sales prices to establish the value of real property in Texas.

• There are numerous problems with basing value (especially taxable value) on the sales price. For instance, appraisal districts do not consider seller concessions, which can lead to artificially high tax appraisal values in the year of purchase and beyond.

• There is also a problem with subdivisions that feature unequally sized lots or custom built homes.

IV.IV.Key Issues Key Issues • Sales price disclosure• What are the issues? • Other issues concern farm and ranch properties where

improvements like trade fixtures and livestock are included in the sales price.

• Additionally, issues arise with commercial properties, which may include a business and/or trade fixtures and properties where mineral rights are included or excluded from the sale.

IV.IV.Key Issues Key Issues • Sales price disclosure• What does this mean for real estate?• Sales price disclosure will lead to a more than

$250 million property tax increase for property owners. • Increasing property taxes would be a

disincentive to homeownership and enterprise resulting in harm to the real estate market and the economy in Texas.

IV.IV.Key Issues Key Issues • Sales price disclosure• What is our position?

• The Texas Association of REALTORS® opposes mandatory sales price disclosure because of the following:

1. sales price is not necessarily a good indicator of taxable value,

2. it’s an unnecessary invasion of privacy, and3. it could pave the way for a new real estate transfer tax

in Texas, as most states that require sales price disclosure use it to compute tax liability for the transfer of real estate.

IV.IV.Key Issues Key Issues • Sales tax on real estate

transactions

• What is the issue?• There are proposals for an expansion

of the sales-tax base to include the sale or lease of real property.


transactions• What does this mean for real estate?

• A sales tax on real estate transactions would make real property less affordable and result in fewer transactions.

• Any sales tax applied to real estate transactions would require purchasers to bring more money to the table.

• Applying sales tax to real estate transactions would initially destroy the first time homebuyer sector.


transactions

• What is our position?• The Texas Association of REALTORS®

opposes efforts to expand the sales tax base to include real estate transactions.

IV.IV.Key Issues Key Issues • Property tax lenders• What are the issues?• Property tax loans are a legitimate tool for residential and commercial property

owners, but high interest rates, exorbitant fees, unregulated entities, and deceptive and aggressive marketing practices plague the industry.

• The Texas Tax Code establishes the authority and procedure for entities to pay delinquent and non-delinquent taxes of property owners. Additionally, the law enables entities to assume priority lien status upon payment of property taxes. This super priority status enables the entity to conduct non judicial foreclosure proceedings upon a default of a loan.

• Property tax lenders are regulated by the Office of Consumer Credit Commissioner (OCCC). However, the introduction of a robust secondary market has complicated the issue by bringing unlicensed and unregulated entities into the equation.

IV.IV.Key Issues Key Issues • Property tax lenders• What does this mean for real estate? • Some property tax lenders sell their notes to investors

and hedge funds, which forces property owners to pay interest and penalties to an unlicensed and unregulated entity. The OCCC has failed to take any action to prevent this.

• These investors are likely to foreclose unlike most banks and taxing entities, which could lead to the next foreclosure crisis.

IV.IV.Key Issues Key Issues • Property tax lenders• What is our position?• The Texas Association of REALTORS® believes the

following should be addressed:1. property tax lenders should be regulated by an agency

with the proper expertise and experience,2. liens associated with defaulted property tax loans should

not take priority over other liens, and3. current law should be expanded to mandate installment

plans for delinquent property taxes.

V.V. Commercial BillsCommercial BillsWhat bills may affect commercial real estate?

HB 225 HB 1988

HB 356 HB 2180/SB 295

HB 855 HB 2775

HB 991 HB 3316

HB 1094/SB 385 SB 155

HB 1144 SB 247

HB 1830

V. Commercial BillsV. Commercial BillsHB 225: Relating to the imposition of a surcharge for the use of a credit card for payments under a commercial or residential real estate lease.

•Summary: o The current law states that a landlord may not impose a surcharge on

a tenant who uses a credit card for payment. At present, this applies to both residential and commercial leases.

o The bill would allow landlords or landlords' agents to be exempted and could now charge a fee if credit card payment is accepted.

V. Commercial BillsV. Commercial BillsHB 356: Relating to the notice required to remove a vehicle with an expired registration or inspection certificate from certain private property.•Summary:

o This bill provides that a notice (pursuant to a contractual provision) indicating that a vehicle will be removed from a parking facility can now be attached to the vehicle in a conspicuous manner in addition to what current law provides. • What is the current law?

o The current law provides that the notice must be delivered either personally or through certified mail.

V. Commercial BillsV. Commercial BillsHB 855: Relating to a security services contractor's lien.•Summary: The bill provides that a security services contractor ("contractor") who provides security services for a commercial entity has a lien for the amount owed under the contract.

• Attachment: The lien attaches to the premises for which the contractor provided security services, if owned by the commercial entity, and to the personal property owned by the commercial entity and located on those premises.

• Securing a Lien: A contractor who has not been paid and who wants to claim a lien must, not later than the 30th day after the date the indebtedness accrues:

1. file with the county clerk of the county in which the premises are located a copy of an account of the services with an affidavit verifying the account by the party making the account; and

2. serve a copy of the account and affidavit on the commercial entity that owns the property or the entity's agent, received, or trustee.

• Duration: A lien expires on the 1st anniversary of the date the lien is secured unless the contractor has sued to foreclose the lien.

• Release When a debt for security services is satisfied, the contractor must, not later than the 10th day after the date the security services contractor receives a written request, provide to the requesting person a release of the indebtedness and any lien claimed, to the extent of the indebtedness paid. A release must be in a form that permits the instrument to be filed of record.

V. Commercial BillsV. Commercial BillsHB 991: Relating to imposing liens for labor and materials provided by interior designers.

•Summary: The bill provides that an interior design contractor ("contractor") who provides labor or materials under an interior design contract has a lien for the amount owed under the contract. This applies only to commercial real or personal property.

o Attachment: The lien attaches to:• commercial personal property and • all nonexempt commercial real property that is owned by a person who contracts with a

contractor and on which the interior environment is locatedo Perfecting a Lien: A contractor claiming a lien may perfect a lien by filing a lien affidavit with the

county clerk of the county in which the real property on which the interior environment is located. The affidavit must be a sworn statement signed by the person claiming the lien or by another person on the claimant's behalf and must contain the following:• the amount of the claim;• the name and last known address of the owner or reputed owner of the property on which

the interior environment is located; • a general statement of the kind of labor performed and materials provided by the claimant;• a description, legally sufficient for identification, of the property sought to be charged with

the lien; and• the claimant's name, mailing address, and, if different, physical address.• The affidavit is not required to include a listing of individual items of labor or material

provided under the interior design contract.o Duration: A lien does not expire and is discharged only when the claimant receives full payment

of the amount owed under the contract.

V. Commercial BillsV. Commercial BillsHB 1094/SB 385 PACE (Property Assessed Clean Energy Act): Relating to authorizing assessments for water and energy improvements in districts designated by municipalities and counties.•Summary: These bills authorize local governments, municipalities, and counties to provide a financial payment structure enabling commercial and industrial property owners to improve their existing lots with energy or water efficient retrofits. A property owner is required to obtain an energy audit to verify the projected energy savings to be achieved by the retrofit and then secure financing through a private institution. The loan provided by the lender is collateralized through an assessment on property taxes each year. These bills further authorizes a participating local government to impose fees to offset the costs of administering the PACE program, which can be assessed as a program application fee paid by the property owner requesting to participate in PACE or as a component of the interest rate on the assessment in the contract between the local government and the property owner.

V. Commercial BillsV. Commercial BillsHB 1144: Relating to availability of certain information regarding energy use and efficiency of certain residential property.

•Summary: o This bill would require a multiple-listing service to include a field for

providing information related to energy use or efficiency of a residence or commercial building.

o Additionally, upon request of the seller of residential or commercial real property, a license holder is required to include in the MLS listing information related to the energy use or efficiency of a residence or building on the property, including Energy Star rating, home energy rating, ICC 70 rating or LEED rating or certification.

V. Commercial BillsV. Commercial BillsHB 1830: Relating to a pilot program authorizing the chief appraiser of certain appraisal districts to compel certain property owners who file a protest with the appraisal review board to disclose certain information related to the property. •Summary: The bill requires disclosure of certain property information in El Paso County, which will be implemented for 2 years beginning on Jan. 1, 2014.

o The bill applies only to a protest relating to property: 1) with an appraised/market value of at least $1 mill as determined by the appraisal district, and 2) that has a commercial or industrial use.

o No later than 30 days before the hearing, the chief appraiser may file a request with the Appraisal Review Board (ARB) to force the owner to disclose information relating to sales price, rate of occupancy, lease or rental income, or production capacity and income of the property that is the subject of the protest. The ARB, in turn, will order the owner to disclose this info if a confidentiality agreement signed by the appraiser who agrees not to disclose the info to anyone other than an employee of the appraisal district and will be used only to establish the value of the property.

o If the owner does not comply with the order, the owner loses the right to protest.

V. Commercial BillsV. Commercial BillsHB 1988: Relating to the use of corrugated stainless steel tubing in residential and commercial structures. •Summary:

o Residential: Corrugated stainless steel tubing in each residential dwelling constructed in this state must conform to the standards of the 2008 International Residential Code or to a version of the code that is adopted by ordinance of the largest municipality in the county in which the dwelling is located and is at least as stringent as the 2008 version. • Defines residential dwelling as a structure that has one or more residential units that

are occupied as, or designed or intended for occupancy as, a residence by individuals.• Defines corrugated stainless steel tubing as a type of conduit that is meant for the

transport of natural gas with residential structure application and consists of corrugated stainless steel or another similar corrugated conduit identified by state fire marshal order.

o Commercial: Corrugated stainless steel tubing in each commercial structure constructed in this state must conform to the minimum standards adopted by state fire marshal order.• Defines commercial structure as a structure that is occupied for, or designed or

intended for occupancy for, a commercial purpose.• Defines corrugated stainless steel tubing as a type of conduit that is meant for the

transport of natural gas wit commercial structure application and consists of corrugated stainless steel or another similar corrugated conduit identified by state fire marshal order.

V. Commercial BillsV. Commercial BillsHB 2180/SB 295: Relating to lender notice to contractors regarding a construction loan or financing agreement for the improvement of real property and related procedures for suspending contractors' and subcontractors' performance.

•Summary: If a lender suspends/ceases a disbursement of loan proceeds to a borrower or property owner under a loan or financing agreement, each contractor and subcontractor providing labor, materials, equipment, or services for an improvement is entitled to suspend contractually required performance without penalty or liability for damages.

o Applicability: This applies only to a lender that provides financing through a construction loan or under a financing agreement for an improvement to real property for which the real property or improvement is collateral.

o Notice: • A lender is required to immediately notify the contractor of a

suspension/cessation of a disbursement of loan proceeds. • On receipt of such notice, a contractor must immediately notify

each of the contractor's subcontractors of the suspension/cessation of the disbursement of loan proceeds and of the subcontractor's right to suspend contractually required performance without penalty or liability for damages as a result of the suspension/cessation of the disbursement of loan proceeds.

V. Commercial BillsV. Commercial BillsHB 2180/SB 295: Relating to lender notice to contractors regarding a construction loan or financing agreement for the improvement of real property and related procedures for suspending contractors' and subcontractors' performance.

•Exception: A lender is not required to give notice to a contractor with respect to a suspension/cessation of a disbursement of loan proceeds if, before the lender suspends/ceases the disbursement of loan proceeds, a written agreement exists between the lender and the contractor that:

o provides for the continued performance by the contractor and for payment to the contractor in the event of a default by the borrower or property owner under the loan or financing agreement;

o provides for notice from the lender to the contractor that the borrower or property owner is in default under the loan or financing agreement;

o requires that, on the receipt of notice under Subdivision (2), the contractor shall immediately notify the contractor's subcontractors of the borrower's or property owner's default under the loan or financing agreement; and

o specifically states that subcontractors of the contractor are 3rd party beneficiaries of the lender's obligations under the agreement.

V. Commercial BillsV. Commercial BillsHB 2775: Relating to the exclusion of certain commercial lease revenue in determining a taxable entity's total revenue for purposes of the franchise tax.•Summary:

o Current Law: In calculating a taxable entity's total revenue for purposes of the franchise tax, a taxable entity shall exclude from its total revenue only the following flow-through funds that are mandated by contract to be distributed to other entities:• sales commissions to nonemployees, including split fee real estate commissions;• the tax basis as determined under the Internal Revenue Code of securities

underwritten; and• subcontracting payments handled by the taxable entity to provide services, labor, or

materials in connection with the actual or proposed design, construction, remodeling, or repair of improvements on real property or the location of the boundaries of real property.

o Proposed Law: The bill adds to the exclusions above by adding certain commercial lease revenue:

payments, excluding expenses for interest and depreciation, received by a landlord of commercial real property from a tenant of the property for ad valorem taxes, any tax or excise imposed on rents, general or special assessments or other taxes, building or property operating expenses, property or other insurance expenses, utility expenses, and maintenance expenses.

V. Commercial BillsV. Commercial BillsHB 3316: Relating to an account for construction retainage; providing a civil penalty.•Summary: Requires a property owner, who enters into a construction loan or financing agreement to pay toward the improvement of real property that is secured wholly or partly by a lien on the property or improvement, to deposit in a construction trust fund account any money withheld from the payment as retainage and held in trust for a beneficiary.

o Order/Use of trust funds:• The trust funds must be used 1st toward the satisfaction of the

owner's obligations/liabilities and a claimant's rights.• The remaining funds may be used by the owner for other construction

payments or direct costs of the owner.• The trust funds are not subject to seizure, offset, or taking by the

financial institution or a creditor of the owner.• This does not alter the owner's obligation or liability under any other

law.

V. Commercial BillsV. Commercial BillsHB 3316: Relating to an account for construction retainage; providing a civil penalty.

•Exemptions:o Single-family/Duplex : This does not apply to a property owner who

enters into a construction loan or financing agreement to pay toward the construction, remodeling, or repair of a single-family house or duplex used for residential purposes, or for land development related thereto .

o Value must be over $250,000 : This does not apply to a property owner improving real property if the value of the improvement to be made is $500,000 or less.

V. Commercial BillsV. Commercial BillsHB 3316: Relating to an account for construction retainage; providing a civil penalty.•Non Compliance :

o If a property owner does not comply, a beneficiary may suspend contractually required performance the 10th day after the date the beneficiary gives the owner written notice that states the intent of the beneficiary to suspend performance and the reason for suspending performance.

o A beneficiary that has suspended performance is not:• required to supply further labor, services, or materials until the owner

has cured and paid the beneficiary its costs for demobilization and remobilization; or

• responsible for damages resulting from suspending work unless the beneficiary continues to suspend performance after the 10th day after the owner has cured.

o An owner may cure any grounds for suspension by complying with the requirements and furnishing proof of such compliance to a beneficiary who has given proper notice.

V. Commercial BillsV. Commercial BillsSB 155: Relating to a limitation on increases in the appraised value for ad valorem tax purposes of commercial or industrial real property.•Summary:

o The bill provides that an appraisal office may increase the appraised value of a commercial or industrial property for a tax year to an amount not to exceed the lesser of: 1) The market value for the most recent tax year or 2) 10% of the appraised value for the preceding year + the appraised value for the preceding year + the market value of all new improvements.

o When appraising commercial or industrial real property, the chief appraiser shall: 1) appraise the property at its market value and 2) include in the appraisal records both the market value of the property and the amount compute in #2 above.

V. Commercial BillsV. Commercial BillsSB 247: Relating to the transfer of an ad valorem tax lien; providing an administrative penalty.•Summary:

o This bill requires property tax lien lenders to be licensed and prohibits tax lien lenders from transferring property tax loans to unlicensed people.

o The bill repeals the foreclosure section of the Tax Code that requires special foreclosure for property tax liens and provides that property tax liens will now be able to be foreclosed on like all other tax liens.

o The bill also removes the requirement that property tax lien contracts provide for a power of sale in the contract. The requirement is now only that the contract provide for foreclosure as specified by the Tax Code.

ConclusionConclusion

Questions

ConclusionConclusion• Thank you for your participation.

• Additional Questions? o Contact the Governmental Affairs

Department at 512/480-8200

• Give us your feedback!

ConclusionConclusion2013 Schedule for Commercial Webinars

Date Topic Instructor

March 28, 2013 Texas Legislature & Real EstateAndrew Cates

May 23, 2013Common Topics When Using

Commercial FormsRon Walker

July 25, 2013Commercial Commission

AgreementsRick Albers

October 24, 2013 1031 Exchanges Teresa Person

Commercial Webinar o 1 hour presentation o Questions will be answered at the end. o For technical...

Documents

Transcript of Commercial Webinar o 1 hour presentation o Questions will be answered at the end. o For technical...