By:  Truan                                            S.B. No. 1508
                                A BILL TO BE ENTITLED
                                       AN ACT
 1-1     relating to the rate and allocation of the hotel occupancy tax in
 1-2     certain municipalities.
 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-4           SECTION 1.  Section 351.003, Tax Code, is amended by adding
 1-5     Subsection (d) to read as follows:
 1-6           (d)  The rate in a municipality that borders on the Gulf of
 1-7     Mexico and has a population of more than 250,000 may not exceed
 1-8     nine percent of the price paid for a room.
 1-9           SECTION 2.  Subchapter B, Chapter 352, Tax Code, is amended
1-10     by adding Section 352.109 to read as follows:
1-11           Sec. 352.109.  USE OF REVENUE; CERTAIN LARGE COASTAL
1-12     MUNICIPALITIES.  (a)  This section applies only to a municipality
1-13     that borders on the Gulf of Mexico and has a population of more
1-14     than 250,000.
1-15           (b)  A municipality to which this section applies shall
1-16     separately account for all revenue derived from the application of
1-17     the tax imposed by this chapter at a rate of more than seven
1-18     percent of the cost of a room.
1-19           (c)  Revenue described by Subsection (b) may be used only
1-20     for:
1-21                 (1)  acquiring land for a municipally owned convention
1-22     center;
1-23                 (2)  constructing, improving, enlarging, equipping,
1-24     repairing, operating, and maintaining a municipally owned
 2-1     convention center; and
 2-2                 (3)  paying bonds used to finance activities in
 2-3     Subdivision (1) or (2).
 2-4           (d)  For the purpose of the allocation of revenue under
 2-5     Section 351.103, revenue described by Subsection (b) is not
 2-6     counted.
 2-7           SECTION 3.  If on or after the effective date of this Act a
 2-8     municipality increases the rate of the tax authorized by Subsection
 2-9     (d), Section 351.003, Tax Code, as added by this Act, the increased
2-10     tax rate does not apply to the tax imposed on the use or possession
2-11     of a room under a contract executed before the effective date of
2-12     this Act that provides for the payment of the tax at the rate in
2-13     effect when the contract was executed, unless the contract is
2-14     subject to change or modification by reason of the tax rate
2-15     increase.  The tax rate applicable to the use or possession of a
2-16     room under the contract is the rate in effect when the contract was
2-17     executed, and the law governing that rate is continued in effect
2-18     for that purpose.
2-19           SECTION 4.  The importance of this legislation and the
2-20     crowded condition of the calendars in both houses create an
2-21     emergency and an imperative public necessity that the
2-22     constitutional rule requiring bills to be read on three several
2-23     days in each house be suspended, and this rule is hereby suspended,
2-24     and that this Act take effect and be in force from and after its
2-25     passage, and it is so enacted.