CS H.B. 1424 75(R)BILL ANALYSIS WAYS & MEANS H.B. 1424 By: Eiland 3-6-97 Committee Report (Unamended) BACKGROUND Section 43.0751, Local Government Code, (Strategic Partnerships for Continuation of Certain Districts) allows for the creation of strategic partnerships between a municipality and a water control and improvement district or a municipal utility district. These agreements can be for several purposes, including: providing services for a fee, specifying terms of a limited or fullpurpose annexation, or any other lawful purpose. Certain municipal utility districts may use the partnership to avoid complete annexation. However, no provisions are made for municipalities to collect the municipal hotel occupancy taxes in the district as part of the strategic partnership agreement. PURPOSE The bill would allow certain municipalities (currently Galveston) to levy a municipal sales and use tax or a municipal hotel occupancy tax in the portion of the district which has entered into a strategic partnership with the municipality. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS SECTION 1.Amends Section 43.0751, Local Government Code, (Strategic Partnerships for Continuation of Certain Districts) by adding subsection (n) which: 1) Applies only to a municipality that has a population for more than 200,000, borders the Gulf of Mexico, and is adjacent to a county with a population of 2.8 million; and 2) Allows the municipality to impose a sales tax or hotel occupancy tax if: a) the municipality has annexed the district for a limited purpose, or b) after two public hearings, the municipality and the district enter into a written agreement allowing the tax. SECTION 2.Emergency clause for immediate enactment.