1-1 By: Haggerty (Senate Sponsor - Armbrister) H.B. No. 1122
1-2 (In the Senate - Received from the House May 13, 1993;
1-3 May 14, 1993, read first time and referred to Committee on Finance;
1-4 May 19, 1993, reported favorably by the following vote: Yeas 13,
1-5 Nays 0; May 19, 1993, sent to printer.)
1-6 COMMITTEE VOTE
1-7 Yea Nay PNV Absent
1-8 Montford x
1-9 Turner x
1-10 Armbrister x
1-11 Barrientos x
1-12 Bivins x
1-13 Ellis x
1-14 Haley x
1-15 Moncrief x
1-16 Parker x
1-17 Ratliff x
1-18 Sims x
1-19 Truan x
1-20 Zaffirini x
1-21 A BILL TO BE ENTITLED
1-22 AN ACT
1-23 relating to the use of municipal hotel occupancy taxes.
1-24 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-25 SECTION 1. Section 351.001, Tax Code, is amended by adding
1-26 Subdivision (8) to read as follows:
1-27 (8) "Visitor information center" or "tourism
1-28 information center" means a building or a portion of a building
1-29 used to distribute or disseminate information to tourists.
1-30 SECTION 2. Section 351.0025, Tax Code, is amended to read as
1-31 follows:
1-32 Sec. 351.0025. Extraterritorial Jurisdiction. (a) A
1-33 municipality with a population of less than 35,000 by ordinance may
1-34 impose the tax authorized under Section 351.002 in the
1-35 municipality's extraterritorial jurisdiction.
1-36 (b) The municipality may not impose a tax under this section
1-37 if as a result of the adoption the combined rate of state, county,
1-38 and municipal hotel occupancy taxes in the extraterritorial
1-39 jurisdiction exceeds 15 percent of the price paid for a room in a
1-40 hotel.
1-41 SECTION 3. Sections 351.101(a), (b), (c), and (f), Tax Code,
1-42 are amended to read as follows:
1-43 (a) Revenue from the municipal hotel occupancy tax may be
1-44 used only to promote tourism and the convention and hotel industry,
1-45 and that use is limited to the following:
1-46 (1) the acquisition of sites for and the construction,
1-47 improvement, enlarging, equipping, repairing, operation, and
1-48 maintenance of convention center facilities or visitor information
1-49 centers, or both;
1-50 (2) the furnishing of facilities, personnel, and
1-51 materials for the registration of convention delegates or
1-52 registrants;
1-53 (3) advertising and conducting solicitations and
1-54 promotional programs to attract tourists and convention delegates
1-55 or registrants to the municipality or its vicinity;
1-56 (4) the encouragement, promotion, improvement, and
1-57 application of the arts, including instrumental and vocal music,
1-58 dance, drama, folk art, creative writing, architecture, design and
1-59 allied fields, painting, sculpture, photography, graphic and craft
1-60 arts, motion pictures, radio, television, tape and sound recording,
1-61 and other arts related to the presentation, performance, execution,
1-62 and exhibition of these major art forms; and
1-63 (5) historical restoration and preservation projects
1-64 or activities or advertising and conducting solicitations and
1-65 promotional programs to encourage tourists and convention delegates
1-66 to visit preserved historic sites or museums:
1-67 (A) at or in the immediate vicinity of
1-68 convention center facilities or visitor information centers; or
2-1 (B) located elsewhere in the municipality or its
2-2 vicinity that would be frequented by tourists and<,> convention
2-3 delegates<, or other visitors to the municipality>.
2-4 (b) Revenue derived from the tax authorized by this chapter
2-5 shall <is to> be expended in a manner directly enhancing and
2-6 promoting tourism and the convention and hotel industry as
2-7 permitted by Subsection (a). That revenue may not be used for the
2-8 general revenue purposes or general governmental operations of a
2-9 municipality.
2-10 (c) The governing body of a municipality by contract may
2-11 delegate to a person, including another governmental entity or a
2-12 private organization, the management or supervision of programs
2-13 and activities funded with revenue from the tax authorized by this
2-14 chapter. The governing body in writing shall approve in advance
2-15 the annual budget of the person to which it delegates those
2-16 functions and shall require the person to make periodic reports to
2-17 the governing body at least quarterly <annually> listing the
2-18 expenditures made by the person with <of> revenue from the tax
2-19 authorized by this chapter <provided by the municipality>. The
2-20 person must maintain revenue provided <by the municipality> from
2-21 the tax authorized by this chapter in a separate account
2-22 established for that purpose and may not commingle that revenue
2-23 with any other money <or maintain it in any other account>. The
2-24 municipality may not delegate to any person the management or
2-25 supervision of its convention and visitors programs and activities
2-26 funded with revenue from the tax authorized by this chapter other
2-27 than by contract as provided by this subsection. The approval by
2-28 the governing body of the municipality of the annual budget of the
2-29 person to whom the governing body delegates those functions creates
2-30 a fiduciary duty in the person with respect to the revenue provided
2-31 by the tax authorized by this chapter <municipality to the person
2-32 under the contract>.
2-33 (f) Hotel occupancy tax revenue spent for a purpose
2-34 authorized by this section may be spent for day-to-day operations,
2-35 supplies, salaries, office rental, travel expenses, and other
2-36 administrative costs only if those administrative costs are
2-37 incurred directly in the promotion and servicing expenditures
2-38 authorized under Section 351.101(a)(1) or (3) <351.101>. If a
2-39 municipal or other public or private entity that conducts an
2-40 activity authorized <for which hotel occupancy tax revenue may be
2-41 used> under this section conducts other activities that are not
2-42 authorized under this section <for which hotel occupancy tax
2-43 revenue may not be used>, the portion of the total administrative
2-44 costs of the entity for which hotel occupancy tax revenue may be
2-45 used may not exceed the portion of those administrative costs
2-46 actually incurred in conducting the authorized activities <for
2-47 which the hotel occupancy tax revenue may be used>.
2-48 SECTION 4. Section 351.1015(d), Tax Code, is amended to read
2-49 as follows:
2-50 (d) For any <eligible> municipality described in Subsection
2-51 (b), a nonprofit manned spaced flight tourism facility shall
2-52 conclusively be deemed to be a convention center facility within
2-53 the meaning of Section 351.101(a)(1).
2-54 SECTION 5. Section 351.103, Tax Code, is amended by amending
2-55 Subsection (a) and adding Subsection (e) to read as follows:
2-56 (a) At least 50 percent of the hotel occupancy tax revenue
2-57 collected by a municipality with a population of 200,000 or greater
2-58 <according to the most recent federal decennial census,> must be
2-59 allocated for the purposes provided by Section 351.101(a)(3). For
2-60 <According to the most recent federal decennial census, for>
2-61 municipalities with a population of less than 200,000, allocations
2-62 for the purposes provided by Section 351.101(a)(3) are as follows:
2-63 (1) if the tax rate in a municipality is not more than
2-64 three percent of the cost paid for a room, not less than the amount
2-65 of revenue received by the municipality from the tax at a rate of
2-66 one-half of one percent of the cost of the room; or
2-67 (2) if the tax in a municipality exceeds three percent
2-68 of the cost of a room, not less than the amount of revenue received
2-69 by the municipality from the tax at a rate of one percent of the
2-70 cost of a room. This subsection does not apply to a municipality,
3-1 regardless of population, that before October 1, 1989, adopted an
3-2 ordinance providing for the allocation of an amount in excess of 50
3-3 percent of the hotel occupancy tax revenue collected by the
3-4 municipality for one or more specific purposes provided by Section
3-5 351.101(a)(1) until the ordinance is repealed or expires or until
3-6 the revenue is no longer used for those specific purposes in an
3-7 amount in excess of 50 percent of the tax revenue.
3-8 (e) A municipality may use hotel occupancy tax revenue
3-9 collected by the municipality for a purpose provided by Section
3-10 351.101(a)(1) only if the municipality complies with the applicable
3-11 provisions of this section.
3-12 SECTION 6. Section 351.105(a), Tax Code, is amended to read
3-13 as follows:
3-14 (a) An eligible coastal municipality that levies and
3-15 collects an occupancy tax authorized by this chapter at a rate of
3-16 seven percent <or more> shall pledge a portion of the revenue equal
3-17 to at least one percent of the cost of a room to either or both of
3-18 the following purposes:
3-19 (1) the payment of the bonds that the municipality or
3-20 a park board of trustees may issue under Section 3, Chapter 63,
3-21 Acts of the 59th Legislature, Regular Session, 1965 (Article
3-22 1269j-4.1, Vernon's Texas Civil Statutes), or under Chapter 33,
3-23 Acts of the 57th Legislature, 3rd Called Session, 1962 (Article
3-24 6081g-1, Vernon's Texas Civil Statutes), in order to provide all or
3-25 part of the funds for the establishment, acquisition, purchase,
3-26 construction, improvement, enlargement, equipment, or repair of
3-27 public improvements, including parks, civic centers, civic center
3-28 buildings, auditoriums, exhibition halls, coliseums, marinas,
3-29 cruise ship terminal facilities, hotels, motels, parking
3-30 facilities, golf courses, trolley or trolley transportation
3-31 systems, and other facilities as may be considered advisable in
3-32 connection with these facilities that serve the purpose of
3-33 attracting visitors and tourists to the municipality; or
3-34 (2) the maintenance, improvement, or operation of the
3-35 parks, civic centers, civic center buildings, auditoriums,
3-36 exhibition halls, coliseums, marinas, cruise ship terminal
3-37 facilities, hotels, motels, parking facilities, golf courses,
3-38 trolley or trolley transportation systems, and other facilities as
3-39 may be considered advisable in connection with these facilities
3-40 that serve the purpose of attracting visitors and tourists to the
3-41 municipality.
3-42 SECTION 7. (a) This Act takes effect September 1, 1993.
3-43 (b) This Act does not apply to the use of tax revenue
3-44 pledged to secure bonds issued before the effective date of this
3-45 Act. Tax revenue pledged to secure bonds issued before the
3-46 effective date of this Act is governed by the law in effect on the
3-47 date the bonds were issued, and that law is continued in effect for
3-48 that purpose.
3-49 SECTION 8. The importance of this legislation and the
3-50 crowded condition of the calendars in both houses create an
3-51 emergency and an imperative public necessity that the
3-52 constitutional rule requiring bills to be read on three several
3-53 days in each house be suspended, and this rule is hereby suspended.
3-54 * * * * *
3-55 Austin,
3-56 Texas
3-57 May 19, 1993
3-58 Hon. Bob Bullock
3-59 President of the Senate
3-60 Sir:
3-61 We, your Committee on Finance to which was referred H.B. No. 1122,
3-62 have had the same under consideration, and I am instructed to
3-63 report it back to the Senate with the recommendation that it do
3-64 pass and be printed.
3-65 Montford,
3-66 Chairman
3-67 * * * * *
3-68 WITNESSES
3-69 No witnesses appeared on H.B. No. 1122.