Public comment urges keeping DHFC independence; board and staff discuss HB 21 implications

During public comment at the June 10, 2025 Dallas Housing Finance Corporation meeting, a member of the public urged the board to preserve the current governance structure of the Housing Finance Corporation (HFC) and the Public Facilities Corporation (PFC). The commenter said he represents affordable‑housing developers and expressed concern that recent departmental proposals to change governance would face limited council support.

Why it matters: The city and its housing entities are evaluating policy proposals and statutory changes that could affect oversight, responsibilities and the structure of HFC/PFC operations. Separately, House Bill 21, signed by the governor on May 28, 2025, introduces new compliance requirements for certain housing financing structures that will affect how the HFC and local sponsors evaluate and manage deals.

Public comment and governance proposals

A public commenter identified as speaking on agenda item 11 urged the board to continue the HFC’s current work without the proposed governance changes and said he believed there was limited political will on the council to enact the department’s proposals. The commenter said he had submitted written comments to the board and offered to answer questions.

Discussion of corporation policy recommendations

President Marcy Halban and staff summarized a months‑long review process by the City of Dallas Department of Housing and Community Development to propose policy recommendations affecting the HFC and the PFC. Staff said those proposals began in October and have proceeded through committee presentations and a small round‑table meeting that included representatives of the housing department, the DHFC, the DPFC and community stakeholders; another meeting was scheduled later in June to continue that work. Staff recommended holding further review until after that follow‑up meeting.

House Bill 21: compliance and deal impacts

Director Ryan Garcia provided an overview of House Bill 21 and its companion Senate Bill. He and other board members described several provisions that change statutory requirements for tax‑abatement and workforce housing deals and impose added annual public‑benefit testing for certain property‑tax exemptions. Key points discussed:

- HB 21 adds reporting, lease‑protection and audit requirements, and establishes an annual test (described in the discussion as a “rent‑reduction” or “public‑benefit” test) that will measure whether property‑tax exemptions produce the promised rent reductions. Staff described a 50% test of exemption value tied to rent concessions, with the ability to pay a shortfall to taxing districts if the test is not met.

- The statute includes a 10‑year period for existing deals to come into compliance with some of the more detailed requirements, while other requirements (such as certain reporting and lease protections) take effect sooner.

- HB 21 also tightens the framework for “out‑of‑jurisdiction” deals: sponsors doing projects outside the city limits now face new hurdles. Several board members said that, in practice, out‑of‑jurisdiction deals will be harder to underwrite and obtain investor confidence for going forward.

Board members and staff noted the law contains several ambiguous provisions that will require regulatory guidance from state agencies; staff expected TDHCA to issue interpretive rules by mid‑ to late‑2025. Board members asked staff, legal counsel and financial advisers to review the HFC’s existing portfolio and transactions that might be affected and to return with recommendations on document amendments or other remediation steps if needed.

Next steps

Staff and board members agreed to continue review after the departmental round‑table meeting at the end of June and recommended a follow‑up presentation to the full board so all members can review the department’s recommended policy changes and the implications of HB 21. The board went into closed session for legal advice and a personnel matter at the end of the public session.

Ending

The board deferred final action on corporation policy recommendations pending further stakeholder meetings and regulatory guidance on HB 21; staff will present a consolidated update to the full board after the next round‑table meeting.