Untitled Texas Attorney General Opinion
GA-1009
| Tex. Att'y Gen. | Jul 2, 2013Background
- TDHCA administers Texas's Low Income Housing Tax Credit Program and issues an annual Qualified Allocation Plan (QAP) that scores applications under criteria listed in Gov't Code § 2306.6710(b).
- Subsection 2306.6710(b)(1)(E) gives a priority for applicants with a “commitment of development funding by local political subdivisions.” The statute does not define "local political subdivision."
- The 2013 QAP Rule 11.9(d)(3) awards up to 13 points for development funding commitments from a city, county, or certain instrumentalities (e.g., housing authorities), but disallows points when the applicant is a “Related Party” to the funding instrumentality.
- Concerns arose where a public housing authority forms or controls a related private entity and lends or grants funds to that related entity; critics say the related-party bar alters the statutory scheme and exceeds TDHCA authority.
- TDHCA defends the related-party limitation as a reasonable means to prevent "self-lending," preserve the program’s goal of stimulating private development, and to give objective meaning to the statutory criterion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Rule 11.9(d)(3)’s exclusion of related-party funding is consistent with Gov't Code § 2306.6710(b)(1)(E) | The related-party bar changes the statutory scheme and exceeds TDHCA's authority by disqualifying legitimate local commitments | The rule reasonably interprets the undefined statutory term to prevent self-lending and to further the program’s purpose of encouraging private development | A court would likely defer to TDHCA and uphold the rule as a reasonable construction of the statute |
| Whether TDHCA may define and give objective scope to the undefined term "local political subdivision" in the QAP | (Implicit) The agency should not narrow statutory priorities beyond the text | The agency may assign meaning to undefined statutory terms and adopt criteria "regarding" the statutory standards | TDHCA has discretion to define the standard; the QAP's definition is within its statutory authority |
Key Cases Cited
- Pruett v. Harris Cnty. Bail Bond Bd., 249 S.W.3d 447 (Tex. 2008) (agencies may adopt rules authorized by and consistent with statutory authority)
- State v. Pub. Util. Comm'n of Tex., 344 S.W.3d 349 (Tex. 2011) (courts defer to reasonable agency statutory constructions that do not contradict plain language)
- Vista Healthcare, Inc. v. Tex. Mut. Ins. Co., 324 S.W.3d 264 (Tex. App.—Austin 2010, pet. denied) (agency rules are presumed valid; challenger bears burden to show invalidity)
- Sec. Nat'l Ins. Co. v. Farmer, 89 S.W.3d 197 (Tex. App.—Fort Worth 2002, pet. denied) ("regarding" means "with respect to" or "concerning")
- Sw. Bell Tel. Co. v. Pub. Util. Comm'n of Tex., 745 S.W.2d 918 (Tex. App.—Austin 1988, writ denied) (agencies have discretion to assign meaning to undefined statutory terms)