How Texas House Bill 21 Changes Housing Finance Corporations and Affordable Housing Development
For years, housing developers in Texas have partnered with housing finance corporations (HFCs) to secure tax exemptions and streamline affordable housing projects. But under House Bill 21, passed in 2025, the rules of the game have changed.
HB 21 Limits the Authority and Geographic Reach of Housing Finance Corporations
HB 21 closes the door on some of the most flexible interpretations of HFC authority. Going forward, HFCs must operate primarily in the jurisdiction where they were created—and must meet specific affordability and accountability thresholds.
End of “Roaming” HFCs for Texas Apartment and Housing Deals
That means no more “roaming” HFCs setting up apartment deals hundreds of miles away from their founding counties. Developers who have relied on these structures will need to reassess whether their current and future projects comply.
Increased Transparency, Auditing, and Oversight Under HB 21
The law also increases transparency around how exemptions are applied and mandates more stringent auditing for pass-through entities. In short: less room for maneuvering, more oversight, and more exposure if your filings aren’t airtight.
What HB 21 Means for Public-Private Housing Partnerships in Texas
This doesn’t mean the end of public-private partnerships for housing—but it does mean more paperwork, more scrutiny, and more risk if things aren’t set up properly.
Legal Guidance for Developers Navigating HB 21 Compliance
CJMA represents developers, nonprofits, and lenders across Texas. We can help you adapt to the new law, protect your investments, and build compliance into your next project from the ground up.