Maverick County Housing Finance Corporation Sued by City of Missouri City, Texas
By: Ricardo E. Calderon, Eagle Pass Business Journal, Inc., Copyright 2025
The City of Missouri City, Texas (City) filed an Original Petition, Request for Temporary Restraining Order, and Request for Temporary and Permanent Injunctions against the Maverick County Housing Finance Corporation (Corporation) and its Board Members in their Official Capacities in the 268th Judicial District Court, Fort Bend County, Texas on January 24, 2025, seeking to enforce its statutory rights under Chapter 394 of the Texas Local Government Code.
The Board of Directors of the Maverick County Housing Finance Corporation are County Judge Ramsey English Cantu and County Commissioners Roberto Ruiz, Olga M. Ramos, Rosanna “Roxi” Rios, and Gerardo “Jerry” Morales.
The Maverick County Housing Finance Corporation was incorporated as a non-profit corporation under the Texas Housing Finance Corporations Act on June 24, 2024 with the Secretary of State of Texas Corporations Section in Austin, Texas. According to its Articles of Incorporation, the Maverick County Housing Finance Corporation “is organized to solely to carry out the purposes of the Act and specifically for the purpose of benefitting and accomplishing public purposes of, and on behalf of, the County, by owning and/or financing the cost of residential ownership and development that will provide decent, safe, and sanitary housing for resident of the County at prices they can afford….”
The City of Missouri City filed the lawsuit to enforce its statutory rights under Chapter 394 of the Texas Local Government Code and to stop Maverick County Housing Finance Corporation and its Board of Directors from acting without authority.
The petition alleges that Maverick County Housing Finance Corporation is acting in an illegal attempt to deprive the City of Missouri City of its statutory right to determine whether Chapter 394 should apply to certain property the Corporation intends to acquire.”
The petition further alleges that “based upon information and belief, the Corporation, through its Board of Directors, is in the process of acquiring “The Ranch at Sienna,” a large apartment complex located at 8811 Sienna Sprints Boulevard, Missouri City, Texas 77459. The Ranch at Sienna complex is located within the corporate boundaries of the City of Missouri City.”
The lawsuit alleges that “once the Corporation acquires the complex, the property will be managed by a third-party contractor and will offer a certain number of below market-rate apartments to qualified low-income individuals and families pursuant to Chapter 394. The Corporation, all property owned by it, the income form the property, all bonds, issued by it, the income from the bonds, and the transfer of the bonds are EXEMPT from license fees, recording fees, and all other TAXES imposed by this state or any political subdivision of this state.”
The lawsuit further alleges that “the Corporation through its Board of Directors has not sought or obtained the City’s approval to apply Chapter 394 to The Ranch at Sienna property as required by the Act.”
The petition alleges that Chapter 394 allows Texas cities with a population over 20,000 the right control whether Chapter 394 applies to the property within the municipality. Housing Finance Corporations must receive approval of the governing body of the municipality over 20,000 in population before Chapter 394 may be applied to property located within the municipality and that a public hearing and approval by the governing body of the local government in other circumstances, including before a Housing Finance Corporation may issue bonds to finance a multifamily residential development to be owned by the Housing Finance Corporation….”
Since the City of Missouri City has a population of 77,000 and The Ranch at Sienna is within the City’s limits, the Maverick County Housing Finance Corporation has not sought or obtained the City of Missouri City’s approval regarding the purchase and development of The Ranch at Sienna apartment complex for low-income housing under Chapter 394.”
The City of Missouri City alleges that the Maverick County Housing Finance Corporation and its Board of Directors are acting “Ultra Vires” in purchasing The Ranch at Sienna apartment complex within its city limits, that is, without approval from the City.
The lawsuit requests the Court to grant the City of Missouri City a temporary restraining order, temporary and permanent injunction, and declaratory relief to stop the Maverick County Housing Finance Corporation from circumventing the approval process required by Chapter 394. The City is requesting a trial by jury, reasonable attorney’s fees, court costs, and injunctive relief against the Maverick County Housing Finance Corporation.
The Maverick County Housing Finance Corporation and its Board of Directors will retain legal counsel to defend it and answer the lawsuit. Generally, defendants deny all the allegations in their original answer before discovery commences between the parties.
This practice has been highlighted by a recent article in the Houston Chronicle where real estate developers are utilizing non-profit housing finance corporations under Chapter 394 to avoid paying millions of taxes and fees, including the Maverick County Housing Finance Corporation.
