By West S.B. No. 1724 75R7668 CBH-F A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to the financing of sports venues, other projects, and 1-3 related infrastructure; authorizing the imposition of certain local 1-4 taxes and the issue of local bonds; providing penalties. 1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-6 SECTION 1. Subtitle C, Title 10, Local Government Code, is 1-7 amended by adding Chapter 334 to read as follows: 1-8 CHAPTER 334. SPORTS VENUES AND OTHER PROJECTS 1-9 SUBCHAPTER A. GENERAL PROVISIONS 1-10 Sec. 334.001. DEFINITIONS. In this chapter: 1-11 (1) "Approved sports venue project" means a sports 1-12 venue project or other project authorized by Section 334.002 that 1-13 has been approved under this chapter by the voters of a 1-14 municipality or county. 1-15 (2) "Governing body" means the governing body of a 1-16 municipality or the commissioners court of a county. 1-17 (3) "Related infrastructure" means any store, 1-18 restaurant, concession, automobile parking facility, area 1-19 transportation facility, road, street, water, or sewer facility, 1-20 or other on-site or off-site improvement that relates to and 1-21 enhances the use, value, or appeal of a sports venue or other 1-22 project authorized by Section 334.002 and any other expenditure 1-23 reasonably necessary to construct, improve, renovate, or expand a 1-24 sports venue or other project. 2-1 (4) "Sports venue" means an arena, coliseum, stadium, 2-2 or other type of area or facility: 2-3 (A) that is primarily used or is planned for 2-4 primary use for one or more professional or amateur sports or 2-5 athletics events; and 2-6 (B) for which a fee for admission to the sports 2-7 or athletics events, other than occasional civic, charitable, or 2-8 promotional events, is charged or is planned to be charged. 2-9 (5) "Sports venue project" means a sports venue or 2-10 other project authorized by Section 334.002 and related 2-11 infrastructure that is planned, acquired, established, developed, 2-12 constructed, or renovated under this chapter. 2-13 Sec. 334.002. OTHER PROJECTS. A county or municipality may 2-14 use this chapter for a project allowed by Section 4B, Development 2-15 Corporation Act of 1979 (Article 5190.6, Vernon's Texas Civil 2-16 Statutes), or Subchapter E, Chapter 451, Transportation Code. 2-17 Sec. 334.003. OTHER USES OF SPORTS VENUE PERMITTED. This 2-18 chapter does not prohibit the use of a sports venue for an event 2-19 that is not related to sports or athletics, such as a 2-20 community-related event. 2-21 (Sections 334.004-334.020 reserved for expansion 2-22 SUBCHAPTER B. SPORTS VENUE PROJECTS 2-23 Sec. 334.021. RESOLUTION AUTHORIZING PROJECT. (a) A county 2-24 or municipality by resolution may provide for the planning, 2-25 acquisition, establishment, development, construction, or 2-26 renovation of a sports venue project if the resolution is approved 2-27 by a majority of the qualified voters of the municipality or county 3-1 voting at an election called and held for that purpose under 3-2 Section 334.022. 3-3 (b) The resolution must designate the sports venue project 3-4 and the maximum rate of the sales and use tax to be imposed to 3-5 finance the project. 3-6 Sec. 334.022. ELECTION. (a) The governing body of the 3-7 municipality or county may order an election on the question of 3-8 approving and implementing the resolution. 3-9 (b) The order calling the election must: 3-10 (1) allow the voters to vote separately on each sports 3-11 venue project; 3-12 (2) designate the sports venue project; and 3-13 (3) designate the maximum rate of the sales and use 3-14 tax to be imposed to finance the project. 3-15 (c) The ballot at the election held under this section must 3-16 be printed to permit voting for or against the proposition: 3-17 "Authorizing ________ (insert name of municipality or county) to 3-18 _______ (insert description of sports venue project) and to impose 3-19 a sales and use tax at the rate of ________ of one percent (insert 3-20 one-eighth, one-fourth, three-eighths, or one-half, as appropriate) 3-21 for the purpose of financing the project." 3-22 (d) The Election Code governs an election held under this 3-23 chapter, except that the uniform election date provisions of 3-24 Section 41.001(a), Election Code, do not apply to an election 3-25 ordered under this section. 3-26 (Sections 334.023-334.040 reserved for expansion 4-1 SUBCHAPTER C. POWERS AND DUTIES 4-2 Sec. 334.041. GENERAL POWERS. (a) A municipality or county 4-3 may perform any act necessary to the full exercise of the 4-4 municipality's or county's powers under this chapter. 4-5 (b) A municipality or county may acquire, sell, lease, 4-6 convey, or otherwise dispose of property or an interest in 4-7 property, including an approved sports venue project, under terms 4-8 and conditions determined by the municipality or county. 4-9 (c) A municipality or county may contract with a public or 4-10 private person, including a sports team, club, organization, or 4-11 other entity to: 4-12 (1) plan, acquire, establish, develop, construct, or 4-13 renovate an approved sports venue project; or 4-14 (2) perform any other act the municipality or county 4-15 is authorized to perform under this chapter. 4-16 (d) If a municipality or county contracts with a sports team 4-17 or club for the construction, renovation, or operation of an 4-18 approved sports venue project, the municipality or county is not a 4-19 party to a subsequent contract between the team or club and another 4-20 person relating to the project. The competitive bidding laws, 4-21 including Chapter 271, Local Government Code, do not apply to a 4-22 contract between a team or club and another person under this 4-23 subsection. 4-24 Sec. 334.042. SPORTS VENUE PROJECT FUND. (a) A 4-25 municipality or county in which an approved sports venue project is 4-26 located shall establish by resolution a fund known as the sports 4-27 venue project fund. 5-1 (b) The municipality or county shall deposit into the sports 5-2 venue project fund: 5-3 (1) the proceeds of the sales and use tax imposed by 5-4 the municipality or county under this chapter; 5-5 (2) all revenue from the sale of bonds or other 5-6 obligations by the municipality or county under this chapter; and 5-7 (3) any other money required by law to be deposited in 5-8 the fund. 5-9 (c) The municipality or county may deposit into the sports 5-10 venue project fund: 5-11 (1) money derived from innovative funding concepts 5-12 such as the sale or lease of luxury boxes or the sale of licenses 5-13 for personal seats; and 5-14 (2) any other revenue derived from the approved sports 5-15 venue project, including stadium rental payments and revenue from 5-16 concessions and parking. 5-17 (d) The municipality or county may use money in the sports 5-18 venue project fund to: 5-19 (1) pay the costs of planning, acquiring, 5-20 establishing, developing, constructing, or renovating one or more 5-21 approved sports venue projects in the municipality or county; 5-22 (2) pay the principal of, interest on, and other costs 5-23 relating to bonds or other obligations issued by the municipality 5-24 or county or to refund bonds, notes, or other obligations; or 5-25 (3) pay the costs of operating or maintaining one or 5-26 more approved sports venue projects during the planning, 5-27 acquisition, establishment, development, construction, or 6-1 renovation or while bonds, notes, or other obligations for the 6-2 planning, acquisition, establishment, development, construction, or 6-3 renovation are outstanding. 6-4 (e) Money deposited into the sports venue project fund, 6-5 including money deposited under Subsection (b)(3), is the property 6-6 of the municipality or county depositing the money. 6-7 Sec. 334.043. BONDS AND OTHER OBLIGATIONS. (a) A 6-8 municipality or county in which an approved sports venue project is 6-9 located may issue bonds, including revenue bonds and refunding 6-10 bonds, or other obligations to pay the costs of the approved 6-11 sports venue project. 6-12 (b) The bonds or other obligations and the proceedings 6-13 authorizing the bonds or other obligations shall be submitted to 6-14 the attorney general for review and approval as required by Article 6-15 3, Chapter 53, Acts of the 70th Legislature, 2nd Called Session, 6-16 1987 (Article 717k-8, Vernon's Texas Civil Statutes). 6-17 (c) The bonds or other obligations must be payable from and 6-18 secured by the revenues in the sports venue project fund. 6-19 (d) The bonds or other obligations may mature serially or 6-20 otherwise not more than four years from their date of issuance. 6-21 (e) The bonds or other obligations are not a debt of and do 6-22 not create a claim for payment against the revenue or property of 6-23 the municipality or county other than an approved sports venue 6-24 project for which the bonds are issued. 6-25 Sec. 334.044. PUBLIC PURPOSE OF PROJECT. (a) The 6-26 legislature finds for all constitutional and statutory purposes 6-27 that an approved sports venue project is owned, used, and held for 7-1 public purposes by the municipality or county. 7-2 (b) Section 25.07(a), Tax Code, does not apply to a 7-3 leasehold or other possessory interest granted by the municipality 7-4 or county while the municipality or county owns the project. 7-5 (c) The project is exempt from taxation under Section 11.11, 7-6 Tax Code, while the municipality or county owns the project. 7-7 (Sections 334.045-334.080 reserved for expansion 7-8 SUBCHAPTER D. SALES AND USE TAX 7-9 Sec. 334.081. SALES AND USE TAX. (a) A municipality by 7-10 ordinance or a county by order may impose a sales and use tax under 7-11 this subchapter. 7-12 (b) A municipality by ordinance or a county by order may 7-13 repeal or decrease the rate of a tax imposed under this subchapter. 7-14 (c) A municipality or county may impose a tax under this 7-15 subchapter only if: 7-16 (1) an approved sports venue project is or is planned 7-17 to be located in the municipality or county; and 7-18 (2) the tax is approved at an election held under 7-19 Section 334.022. 7-20 Sec. 334.082. TAX CODE APPLICABLE. (a) Chapter 321, Tax 7-21 Code, governs the imposition, computation, administration, 7-22 collection, and remittance of a municipal tax authorized under this 7-23 subchapter except as inconsistent with this subchapter. 7-24 (b) Chapter 323, Tax Code, governs the imposition, 7-25 computation, administration, collection, and remittance of a county 7-26 tax authorized under this subchapter except as inconsistent with 7-27 this subchapter. 8-1 (c) Section 321.101(f), Tax Code, and Sections 323.101(b) 8-2 and (d), Tax Code, do not apply to the tax authorized by this 8-3 subchapter. 8-4 Sec. 334.083. TAX RATE. (a) The rate of a tax adopted 8-5 under this subchapter must be one-eighth, one-fourth, 8-6 three-eighths, or one-half of one percent. 8-7 (b) The ballot proposition at the election held to adopt the 8-8 tax must specify the rate of the tax to be adopted. 8-9 Sec. 334.084. RATE INCREASE. (a) A municipality or county 8-10 that has adopted a sales and use tax under this subchapter at a 8-11 rate of less than one-half of one percent may by ordinance or order 8-12 increase the rate of the tax if the increase is approved by a 8-13 majority of the registered voters of that municipality or county 8-14 voting at an election called and held for that purpose. 8-15 (b) The tax may be increased under Subsection (a) in one or 8-16 more increments of one-eighth of one percent to a maximum of 8-17 one-half of one percent. 8-18 (c) The ballot for an election to increase the tax shall be 8-19 printed to permit voting for or against the proposition: "The 8-20 adoption of a sales and use tax for the purpose of financing 8-21 _______ (insert description of sports venue project) at the rate of 8-22 _______ of one percent (insert one-fourth, three-eighths, or 8-23 one-half, as appropriate)." 8-24 Sec. 334.085. IMPOSITION OF TAX. (a) If the municipality 8-25 or county adopts the tax, a tax is imposed on the receipts from the 8-26 sale at retail of taxable items in the municipality or county at 8-27 the rate approved at the election. 9-1 (b) There is also imposed an excise tax on the use, storage, 9-2 or other consumption in the municipality or county of tangible 9-3 personal property purchased, leased, or rented from a retailer 9-4 during the period that the tax is effective in the municipality or 9-5 county. The rate of the excise tax is the same as the rate of the 9-6 sales tax portion of the tax and is applied to the sale price of 9-7 the tangible personal property. 9-8 Sec. 334.086. EFFECTIVE DATE OF TAX. The adoption of the 9-9 tax or the change of the tax rate takes effect on the first day of 9-10 the first calendar quarter occurring after the expiration of the 9-11 first complete quarter occurring after the date on which the 9-12 comptroller receives a notice of the results of the election 9-13 adopting or increasing the tax or of the ordinance or order 9-14 decreasing the tax. 9-15 Sec. 334.087. DEPOSIT OF TAX REVENUES. Revenue from the tax 9-16 imposed under this subchapter shall be deposited in the sports 9-17 venue project fund of the municipality or county imposing the tax. 9-18 Sec. 334.088. ABOLITION OF TAX. (a) A sales and use tax 9-19 imposed under this subchapter may not be collected after the last 9-20 day of the first calendar quarter occurring after notification to 9-21 the comptroller by the municipality or county that the municipality 9-22 or county has abolished the tax or that all bonds or other 9-23 obligations of the municipality or county that are payable in whole 9-24 or in part from money in the sports venue project fund, including 9-25 any refunding bonds or other obligations, have been paid in full or 9-26 the full amount of money, exclusive of guaranteed interest, 9-27 necessary to pay in full the bonds and other obligations has been 10-1 set aside in a trust account dedicated to the payment of the bonds 10-2 and other obligations. 10-3 (b) The municipality or county shall notify the comptroller 10-4 of the expiration of the tax not later than the 60th day before the 10-5 expiration date. 10-6 SECTION 2. The importance of this legislation and the 10-7 crowded condition of the calendars in both houses create an 10-8 emergency and an imperative public necessity that the 10-9 constitutional rule requiring bills to be read on three several 10-10 days in each house be suspended, and this rule is hereby suspended, 10-11 and that this Act take effect and be in force from and after its 10-12 passage, and it is so enacted.