Harvey Recovery Local issues State issues

These bills strengthening Texas tenants’ rights and disaster recovery could reshape our future

Texans face a host of housing issues: an inadequate amount of quality affordable homes and the lingering effects of Hurricane Harvey, and not to mention preparation for the next big storm. This legislative session, Texas Housers is focused on promoting the passage of several bills that seek to address these matters, specifically regarding disaster recovery and tenant-landlord issues, before the session concludes in late May.

While some communities recover quickly from a natural disaster, others may often be slower to gain resources, attention, and, in some cases, basic standards of living. It’s also a problem that large infrastructure projects that are not directly connected to residents’ needs can supersede the residents who are living without homes.

An event like Harvey affected millions of people and part of the sluggish recovery for the most vulnerable survivors could have been averted with planning already in place. Senate Bill 289 filed by Sen. Eddie Lucio Jr. (D-Brownsville) addresses this very issue by establishing a plan of action for before a disaster hits hard in communities that require quick assistance.

The bill establishes a disaster planning process for local governments with the assistance of Texas A&M University’s Hazard Reduction and Recovery Center. The plan is then reviewed by the state agency administering long-term disaster recovery (currently the General Land Office) and the Governor. If approved, then that local government has a recovery plan in place, which will expedite the recovery process that currently takes several years after funding is appropriated. A “precovery” plan could cut that wait down to months.

Another bill related to disaster recovery is SB 812, which was also filed by Sen. Lucio. This would protect Community Development Block Grant-Disaster Recovery (CDBG-DR) recipients from increased property taxes if their home is destroyed and replaced using these funds. This bill simply expands an existing, common sense law that is already in place for those recovering from Hurricanes Ike and Dolly. The passage of SB 812 would ensure that these existing protections from huge hikes in property tax liability extend to survivors of Hurricane Harvey as well as inevitable future disasters.

For example, let’s say there is a resident who lives in an older home with an appraised value of $50,000. A disaster strikes this home and it is deemed destroyed and in need of replacement. Through the CDBG-DR program, this disaster survivor is able to have a home rebuilt that is functionally equivalent to their destroyed home with new materials under updated building codes. When this new home is reappraised, however, it might now be appraised at $150,000, thus the taxes assessed on that disaster survivor’s new home are much higher, through no fault or action of their own. SB 812 effectively eases that dramatic tax jump for those who have their houses replaced after a disaster and gradually raises the appraised value starting from the property’s pre-disaster value.

Recovery after disasters could accelerate from years to months with an established “precovery” plan.

While our first pair of priority legislation deals with recovery, this pair deals with tenant-landlord issues. First is House Bill 970 filed by Rep. Armando Walle (D-Houston) and Senate companion SB 640 filed by Sen. Joan Huffman (R-Houston) which would require landlords to notify tenants prior to signing a lease if the housing being offered is located in a floodplain.

The law states that in the sale of a home, a seller must notify a buyer if the property is in a floodplain. However, no such law exists for tenants. This bill would require a landlord, before any lease is signed, to notify a tenant in writing that the unit is in a “flood zone” as defined by FEMA. This notification would be triggered if the housing, parking area, or storage is in a floodplain, and applies to residential rental housing, manufactured home lots, and commercial rental space. If the unit happens to be in a flood zone, the tenant will be notified in writing about the nature of the flood risk and be warned about the need for insurance. The goal of this legislation is to provide renters a more informed decision regarding their housing and allow them to take necessary actions to protect themselves, their families, and personal property.

A second bill regarding tenants’ rights is HB 2457 filed by Rep. Canales (D-Edinburg) and it regards overly punitive late fees. Most rental leases provide for a late fee to be assessed if a tenant is late with paying rent, as long as that fee is based on a reasonable estimate of uncertain damages cause by that late payment. However, a tenant may not even be aware a fee has been assessed because there is no requirement that a landlord notify them of this or that a tenant’s rent payment has been applied to the fee before rent. This leads to fees being charged on fees, allowing them to grow and accrue without the tenant’s knowledge to a point that threatens the tenant’s housing security.

This bill would require that a landlord apply a payment from a tenant to the rent first, prior to any fees, and that late fees may not be assessed if an unpaid amount owed to a landlord does not consist of rent. The goal is to prevent the unreasonable accrual of late fees that excessively punishes tenants, and to give landlords a structured plan to follow rather than facing litigation for charging unreasonable fees.While these bills represent Texas Housers’ priorities, we are always watching for other bills relating to a number of different housing issues which can be found here.

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