1-1     By:  Truan                                            S.B. No. 1508
 1-2           (In the Senate - Filed March 12, 1999; March 15, 1999, read
 1-3     first time and referred to Committee on Intergovernmental
 1-4     Relations; April 12, 1999, reported favorably by the following
 1-5     vote:  Yeas 5, Nays 0; April 12, 1999, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to the rate and allocation of the hotel occupancy tax in
 1-9     certain municipalities.
1-10           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11           SECTION 1.  Section 351.003, Tax Code, is amended by adding
1-12     Subsection (d) to read as follows:
1-13           (d)  The rate in a municipality that borders on the Gulf of
1-14     Mexico and has a population of more than 250,000 may not exceed
1-15     nine percent of the price paid for a room.
1-16           SECTION 2.  Subchapter B, Chapter 352, Tax Code, is amended
1-17     by adding Section 352.109 to read as follows:
1-18           Sec. 352.109.  USE OF REVENUE; CERTAIN LARGE COASTAL
1-19     MUNICIPALITIES.  (a)  This section applies only to a municipality
1-20     that borders on the Gulf of Mexico and has a population of more
1-21     than 250,000.
1-22           (b)  A municipality to which this section applies shall
1-23     separately account for all revenue derived from the application of
1-24     the tax imposed by this chapter at a rate of more than seven
1-25     percent of the cost of a room.
1-26           (c)  Revenue described by Subsection (b) may be used only
1-27     for:
1-28                 (1)  acquiring land for a municipally owned convention
1-29     center;
1-30                 (2)  constructing, improving, enlarging, equipping,
1-31     repairing, operating, and maintaining a municipally owned
1-32     convention center; and
1-33                 (3)  paying bonds used to finance activities in
1-34     Subdivision (1) or (2).
1-35           (d)  For the purpose of the allocation of revenue under
1-36     Section 351.103, revenue described by Subsection (b) is not
1-37     counted.
1-38           SECTION 3.  If on or after the effective date of this Act a
1-39     municipality increases the rate of the tax authorized by Subsection
1-40     (d), Section 351.003, Tax Code, as added by this Act, the increased
1-41     tax rate does not apply to the tax imposed on the use or possession
1-42     of a room under a contract executed before the effective date of
1-43     this Act that provides for the payment of the tax at the rate in
1-44     effect when the contract was executed, unless the contract is
1-45     subject to change or modification by reason of the tax rate
1-46     increase.  The tax rate applicable to the use or possession of a
1-47     room under the contract is the rate in effect when the contract was
1-48     executed, and the law governing that rate is continued in effect
1-49     for that purpose.
1-50           SECTION 4.  The importance of this legislation and the
1-51     crowded condition of the calendars in both houses create an
1-52     emergency and an imperative public necessity that the
1-53     constitutional rule requiring bills to be read on three several
1-54     days in each house be suspended, and this rule is hereby suspended,
1-55     and that this Act take effect and be in force from and after its
1-56     passage, and it is so enacted.
1-57                                  * * * * *