SB785

Regular Session

Relating to the regulation of new HUD-code manufactured housing.

CriticalImmediate action required

Low Cost

Effective:2026-09-01

Enforcing Agencies

Municipal Planning and Zoning Departments • Texas Department of Housing and Community Affairs (TDHCA) - Manufactured Housing Division

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

Effective Date: September 1, 2026 (Statutory Text controls over Bill Analysis).
Compliance Deadline: Immediate (2025) for Land Acquisition teams regarding deed restriction verification; September 1, 2026 for municipal zoning interactions and fee adjustments.
Agency Rulemaking: Municipalities will rewrite zoning ordinances between now and Sept 2026. This is a "Gap Year" where you must actively participate in city council meetings to ensure the designated zones are commercially viable, not relegated to undesirable land.

Immediate Action Plan

Audit Land Bank: Immediately review all owned or optioned land against the January 2, 2025 deed restriction cutoff.
Monitor "All-Restricted" Cities: Identify municipalities rushing to implement city-wide deed restrictions before the September 1, 2025 deadline to exempt themselves from the law.
Update Standard Operating Procedures (SOPs): Revise permitting SOPs to trigger a "Demand for Approval" letter on Day 46 if no written denial is received.
Lobby Local Zoning: Assign regional managers to attend Planning & Zoning meetings during the 2025-2026 implementation year to influence where the "by right" zones are placed.

Operational Changes Required

Contracts

Land Acquisition Agreements: Update feasibility periods to align with the new 45-day municipal review shot clock. Ensure "Governmental Approval" contingencies account for automatic approval mechanisms.
Sales Contracts: Insert specific disclaimers clarifying that while municipal zoning may allow the home, the Seller makes no representation regarding private deed restrictions or HOA covenants, placing the burden of verification on the Buyer.

Hiring/Training

Land Acquisition Teams: Must be trained to identify the "All-Restricted" exemption. If a municipality bans manufactured housing via deed restrictions on *all* residential land by September 1, 2025, the municipality is exempt from this law.
Permit Expediters: Train staff to demand itemized invoices for "actual costs" of transport rather than flat administrative fees.

Reporting & Record-Keeping

Application Tracking: Implement a rigid tracking system for the 45-day approval window. The clock starts on the "Date of Receipt."
Proof of Submission: All applications must be submitted via Certified Mail or digital portals with timestamped receipts. Automatic approval relies entirely on proving the start date.
Zoning Map Archival: Download and archive official zoning maps as of the effective date to prevent retroactive "downzoning" disputes.

Fees & Costs

Fee Elimination: Effective Sept 1, 2026, cease payment of Specific Use Permit (SUP) fees and generic "transportation/installation" fees.
Budget Adjustment: Budget only for "actual costs" incurred by the municipality (e.g., police escorts for wide loads). Reject any flat "administrative" fees that cannot be substantiated by an invoice.

Strategic Ambiguities & Considerations

"Actual Costs": The statute allows cities to bill for actual costs but does not define the limits. Expect cities to attempt to recover lost permit revenue here. We anticipate litigation to define "reasonable" actual costs.
"Area Determined Appropriate": Municipalities must designate a zone, but they have discretion on *which* zone. Without industry advocacy during the 2025-2026 rulemaking period, cities will likely designate flood plains or industrial-adjacent land as the compliant zone.
"New" vs. Aged Inventory: The law applies to "new" HUD-code homes. Clarification is needed for inventory that has sat on a retailer's lot (aged) but was never titled. Treat "new" as "never previously titled/occupied" until further guidance is issued.

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Legislative Timeline

This bill's path through the Texas Legislature

TopicsCity Government City Government--land Use & Zoning Housing Housing--manufactured Housing Permits

Official Analysis

View HRO Analysis View All Bill Documents

BILL ANALYSIS

Senate Research Center	S.B. 785
89R3895 MP-F	By: Flores
	Local Government
	3/14/2025
	As Filed

AUTHOR'S / SPONSOR'S STATEMENT OF INTENT

Texas needs more options and solutions to meet the growing demand for affordable housing. As one of several policies to bring new housing type options and increase the supply of homes, in particular affordable homes, S.B. 785 ensures that in some capacity manufactured homes serve a role in every city's housing stock.

Modern manufactured housing demonstrates modern features, aesthetics, and value. This bill requires that every city allow new HUD-code manufactured homes to be built, by right, in at least one area of residential zoning and prohibits cities from, directly or indirectly, prohibiting manufactured homes within the entire city limits. Cities still maintain the right to choose size and location for suitable manufactured homes placement and exclude manufactured homes from unsuitable locations.

As proposed, S.B. 785 amends current law relating to the regulation of new HUD-code manufactured housing.

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 1201.008, Occupations Code, by amending Subsections (b) and (d) and adding Subsections (d-1) and (g), as follows:

(b) Requires a municipality, subject to Subsection (g), on application, to permit the installation of a HUD-code manufactured home for use as a dwelling in any area determined appropriate by the municipality, including a subdivision, planned unit development, single lot, and rental community or park. Makes a nonsubstantive change.

(d) Prohibits a local government unit, except as approved by the Texas Department of Housing and Community Affairs operating through its manufactured housing division and subject to Subsection (d-1), from requiring a permit, a fee, a bond, or insurance for the transportation and installation of manufactured housing by a licensed retailer or installer.

(d-1) Prohibits a municipality from unreasonably regulating or restricting the installation of new HUD-code manufactured homes. Prohibits a municipality from requiring a specific use permit or other permit that serves a similar purpose to a specific use permit for a new HUD-code manufactured home that has been constructed in accordance with federal law and Chapter 1201 (Manufactured Housing).

(g) Provides that a municipality with zoning regulations or zoning district boundaries is required to permit the installation of a new HUD-code manufactured home for use as a dwelling under at least one residential zoning classification or type of residential district and is prohibited from adopting or enforcing other zoning regulations or zoning district boundaries that directly or indirectly prohibit the installation of new HUD-code manufactured homes in all residential zoning classifications or types of residential zoning districts adopted by the municipality.

SECTION 2. Effective date: September 1, 2025.

Senate Authors

Sen. Peter FloresRepublican · Primary Author

Coauthors (1)

Paul Bettencourt (R)

House Sponsors

Rep. Ryan GuillenRepublican · Primary Sponsor

Joint Sponsors

Janie Lopez (R)

Bill Text(with markup)

S.B. No. 785

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

	AN ACT
	relating to the regulation of new HUD-code manufactured housing.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1. Section 1201.008, Occupations Code, is amended
	by amending Subsections (b) and (d) and adding Subsections (d-1),
	(g), and (h) to read as follows:
	(b) Subject to Subsection (g), on [On] application, the
	municipality shall permit the installation of a HUD-code
	manufactured home for use as a dwelling in any area determined
	appropriate by the municipality, including a subdivision, planned
	unit development, single lot, and rental community or park. An
	application to install a new HUD-code manufactured home for use as a
	dwelling is considered to be granted unless the municipality in
	writing denies the application and states the reason for the denial
	not later than the 45th day after the date the application is
	received.
	(d) Except as approved by the department and subject to
	Subsection (d-1), a local governmental unit may not require a
	permit, a fee, a bond, or insurance for the transportation and
	installation of manufactured housing by a licensed retailer or
	installer. This subsection does not prohibit the collection of
	actual costs incurred by a local governmental unit that result from
	the transportation of a manufactured home.
	(d-1) A municipality may not require a specific use permit or
	other permit that serves a similar purpose to a specific use permit
	for a new HUD-code manufactured home if:
	(1) the home has been constructed in accordance with
	federal law and this chapter; and
	(2) the municipality does not require a specific use
	permit for other residential property in the same zoning
	classification.
	(g) Except as provided by Subsection (h), a municipality
	with zoning regulations or zoning district boundaries:
	(1) shall permit the installation, by right, of a new
	HUD-code manufactured home for use as a dwelling within the
	municipality's boundaries under at least one:
	(A) residential zoning classification;
	(B) type of residential zoning district; or
	(C) dedicated zoning classification for
	residential HUD-code manufactured homes;
	(2) shall ensure at least one of the residential
	zoning classifications or districts described by Subdivision (1)
	has been adopted and applies to an area of land within the
	municipality's boundaries; and
	(3) if the municipality has a comprehensive zoning
	classification map, shall indicate on the map the areas within the
	municipality's boundaries that comply with Subdivision (2).
	(h) Subsection (g) does not:
	(1) limit the authority of a municipality to adopt or
	enforce an ordinance, rule, or other measure to protect historic
	landmarks or include properties within the boundaries of a local
	historic district;
	(2) affect deed restrictions established before
	January 2, 2025; or
	(3) apply to a municipality:
	(A) in which all areas zoned for residential use
	have deed restrictions on September 1, 2025, prohibiting the
	placement of manufactured homes; or
	(B) that does not have any areas or districts
	zoned for business or industrial use.
	SECTION 2. This Act takes effect September 1, 2026.

LEGISLATIVE BUDGET BOARD
Austin, Texas

FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION


March 14, 2025

TO:	Honorable Paul Bettencourt, Chair, Senate Committee on Local Government

FROM:	Jerry McGinty, Director, Legislative Budget Board

IN RE:	SB785 by Flores (Relating to the regulation of new HUD-code manufactured housing.), As Introduced

No fiscal implication to the State is anticipated.

Local Government Impact

No significant fiscal implication to units of local government is anticipated.

Source Agencies:

LBB Staff:

JMc, SZ, BC, CWi

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Frequently Asked Questions

Common questions about SB785

What does Texas SB785 do?

SB785 mandates that Texas municipalities designate at least one residential zoning district where new HUD-code manufactured homes are permitted "by right," effectively eliminating discretionary Specific Use Permits (SUPs) for qualifying installations. While the statutory effective date is September 1, 2026, immediate action is required to verify deed restrictions, as the "lookback" dates for exemptions are set in 2025. Implementation Timeline Effective Date: September 1, 2026 (Statutory Text controls over Bill Analysis).

Who authored SB785?

SB785 was authored by Texas Senator Peter Flores during the Regular Session.

When was SB785 signed into law?

SB785 was signed into law by Governor Greg Abbott on June 22, 2025.

Which agencies enforce SB785?

SB785 is enforced by Municipal Planning and Zoning Departments and Texas Department of Housing and Community Affairs (TDHCA) - Manufactured Housing Division.

How urgent is compliance with SB785?

The compliance urgency for SB785 is rated as "critical". Businesses and organizations should review the requirements and timeline to ensure timely compliance.

What is the cost impact of SB785?

The cost impact of SB785 is estimated as "low". This may vary based on industry and implementation requirements.

What topics does SB785 address?

SB785 addresses topics including city government, city government--land use & zoning, housing, housing--manufactured housing and permits.

Legislative data provided by LegiScanLast updated: November 25, 2025

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