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, if any, of Department staff, and the executive director, and the final decision.
   2. (2) Applicant--A person who has submitted 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 Governing Board of the Texas Department of Housing and Community Affairs.
   5. (5) Department--The Texas Department of Housing and Community Affairs.
   6. (6) Person--Any individual, partnership, corporation, association, unit of government, community action agency, or public or private organization of any character.

2. (b) Grounds. This appeal process is available to any Applicant, including for tax exempt bonds and low income housing tax credits under 26 U.S.C. §42, except for low income housing tax credits which are subject to the State housing credit ceiling and which have a separate appeals process. An Applicant for funding or other assistance from the Department may only appeal the disposition of the 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 seventh 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 seven 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 consider any information submitted by the Applicant after the written appeal. The Board will review the Appeal de novo and may consider any information properly considered by the Department in making its prior decision(s).
5. (e) Public Comment. The Board will hear public comment on the Appeal under its usual procedures. While public comment will be heard, persons making public comment are not parties to the Appeal and no rights accrue to them under this section or Appeal process.
6. (f) 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 denied, the Department shall notify the Applicant of the decision, including the basis for denial.
7. (g) Final Decision. Appeals not submitted in accordance with this section will not be considered, unless the Department or Board, in the exercise of its discretion, determines there is good cause to consider the appeal. 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; amended to be effective June 24, 2003, 28 TexReg 4631.