1. (a) Definitions. The following words and terms, when used in this subchapter, shall have the following meanings, unless the context clearly indicates otherwise.

   1. (1) Appeal file--The written record of an appeal that contains the applicant's appeal; the responses of Department staff, the executive director, and the board, as applicable; and the final decision.
   2. (2) Applicant--A person who submits, or is preparing to submit, to the Department an application for Department funds or other assistance.
   3. (3) Application--The written request for Department funds or other assistance in the format required by the Department including any exhibits or other supporting material.
   4. (4) Board--The board of directors of the Texas Department of Housing and Community Affairs.
   5. (5) Department--The Texas Department of Housing and Community Affairs.
   6. (6) Low-income housing tax credit--The credit against federal income tax as provided for in §42 of the Internal Revenue Code (42 U.S.C. §42.)
   7. (7) Person--Any individual, partnership, corporation, association, unit of government, community action agency, public or private organization of any character.

2. (b) Grounds. An applicant for funding or other assistance from the Department, other than low-income housing tax credits, may only appeal the disposition of its application by Department staff based on one or more of the following grounds.

   1. (1) Misplacement of an application. All or a portion of the application is lost, misfiled, or otherwise misplaced by Department staff resulting in unequal consideration of the applicant's proposal.
   2. (2) Mathematical error. In rating an application, the score on any selection criteria is incorrectly computed by the Department due to human or computer error.
   3. (3) Procedural error. The application is not processed by Department staff in accordance with the application and selection rules in effect for the current application cycle.

3. (c) Appeal to the executive director. An applicant must file a written appeal with the Department not later than the fourteenth day after the date the Department publishes notice on its website of the results of the application evaluation process or, in the case of private activity mortgage revenue bond programs, after written notice has been provided to the applicant, whichever is earlier. The notice must include specific information relating to the disposition of each application, including the reasons for disqualification or summaries detailing the points awarded. The applicant must specifically identify the applicant's grounds for the appeal based on the disposition of its application. Upon receipt of an appeal, staff shall prepare an appeal file for the executive director's review. The executive director shall respond in writing to the appeal not later than the fourteenth day after the date of receipt of the appeal. The executive director may take one of the following actions.

   1. (1) Concur with the appeal and make the appropriate adjustments to the staff's decision; or
   2. (2) Disagree with the appeal and provide the basis for rejecting the appeal to the applicant.
4. (d) Appeal to the Board. If the applicant is not satisfied with the executive director's response to the appeal, the applicant may appeal in writing directly to the board within sixty days after the date of the executive director's response. The executive director shall prepare an appeal file for the board's review. The board may not review any information not submitted by the applicant at least seven days before the board meeting.
5. (e) Possible actions. In instances in which the appeal if sustained by the board could have resulted in an award to the applicant, the application shall be approved by the board contingent on the availability of funds. If no funds are available in the current year's funding cycle, then the applicant shall be awarded funds from the next year's available funding or from the pool of deobligated funds. In the case of private activity mortgage revenue bond programs, the applicant shall be encouraged to reapply in the next year's program funding cycle. If the appeal is rejected, the Department shall notify the applicant of its decision, including the basis for final denial.
6. (f) Final Decision. Appeals not submitted in accordance with this section are dismissed and shall not be granted an extension to refile if the time period for filing an appeal has expired. The decision of the board is final.

Source Note:The provisions of this §1.7 adopted to be effective January 1, 2002, 26 TexReg 10864.