SRC-JLB C.S.H.B. 2718 78(R)BILL ANALYSIS


Senate Research CenterC.S.H.B. 2718
78R17444 SMJ-DBy: Smith, Wayne (Jackson)
Intergovernmental Relations
5/22/2003
Committee Report (Substituted)


DIGEST AND PURPOSE 

Currently, the Texas Tax Code allows for coastal municipalities to levy
and collect a hotel occupancy tax at a rate of seven percent and to pledge
at least one percent of that revenue to either or both the payment of
bonds issued for the establishment, acquisition, purchase, construction,
improvement, enlargement, maintenance, or operation of facilities that
serve the purpose of attracting visitors and tourists.  However, this form
of occupancy taxing is not available to home-rule municipalities adjacent
to bays.  C.S.H.B. 2718 allows home-rule municipalities adjacent to a bay
of this state, with a population less than 80,000, to allocate revenues
for items that are currently allowable for eligible coastal communities
and requires a municipality that uses revenue from the tax imposed to
spend the same amount of revenue for the same purpose from a source other
than that tax.  

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to
a state officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Subchapter B, Chapter 351, Tax Code, by adding Section
351.104, as follows: 
 
Sec. 351.104.  ALLOCATION OF REVENUE:  CERTAIN MUNICIPALITIES BORDERING
BAYS.  (a)  Provides that this section applies only to a home-rule
municipality that borders a bay, that has a population of less than
80,000, and that is not an eligible coastal municipality. 
 
  (b)  Defines "adjacent public land" and "clean and maintain."

(c)  Prohibits a municipality to which this section applies,
notwithstanding any other provision of this chapter and subject to
Subsections (d) and (e), from using more than 10 percent of the revenue
derived from the tax imposed under this chapter for certain purposes. 

(d)  Prohibits a municipality to which this section applies from reducing
the amount of revenue that it uses for a purpose described by Section
351.101(a)(3) to an amount that is less than the average amount of revenue
used by the municipality for that purpose during the 36-month period that
precedes the municipality's use of revenue under Subsection (c). 

(e)  Requires a municipality that uses revenue from the tax imposed under
this chapter for a purpose provided by this section to spend the same
amount of revenue for the same purpose from a source other than that tax.
 
SECTION 2.  Effective date:  September 1, 2003.