| TO: | Honorable Royce West, Chair, Senate Committee on Intergovernmental Relations |
| FROM: | John S. O'Brien, Director, Legislative Budget Board |
| IN RE: | HB1820 by Hamilton (Relating to the authority to impose a county hotel occupancy tax and to the maximum rate of the tax.), As Engrossed |
| Fiscal Year | Probable Net Positive/(Negative) Impact to General Revenue Related Funds |
|---|---|
| 2008 | $0 |
| 2009 | $0 |
| 2010 | $0 |
| 2011 | $0 |
| 2012 | $0 |
| Fiscal Year | Probable Revenue Gain/(Loss) from Orange County |
Probable Revenue Gain/(Loss) from Bosque County |
Probable Revenue Gain/(Loss) from Hill County |
Probable Revenue Gain/(Loss) from Johnson County |
|---|---|---|---|---|
| 2008 | $171,000 | $125,000 | $605,000 | $440,000 |
| 2009 | $178,000 | $130,000 | $628,000 | $457,000 |
| 2010 | $185,000 | $135,000 | $652,000 | $474,000 |
| 2011 | $191,000 | $139,000 | $675,000 | $491,000 |
| 2012 | $198,000 | $144,000 | $697,000 | $507,000 |
The bill would amend Section 352.002 of the Tax Code, relating to the authority of certain counties to impose a county hotel occupancy tax and to the rate of that tax.
The bill would allow any county that borders or contains a portion of the Neches River, the Sabine River, and Sabine Lake to impose a county hotel occupancy tax; however, the allowable rate for the county hotel occupancy tax would be capped at two percent.
The bill would allow any county that borders Whitney Lake to impose a county hotel occupancy tax; however, the tax imposed by this provision would not apply to a hotel located in a municipality that imposes a tax under Chapter 351. Under the provisions of the bill, the revenue generated by the county hotel tax for counties bordering Whitney Lake could only be used for the certain tourism-related purposes and only in relation to incorporated areas of the county.
The bill would take effect immediately upon enactment if it receives two-thirds vote in each house; otherwise, it would take effect September 1, 2007.According to the Comptroller of Public Accounts, only Orange County would meet the criteria established under the provisions of the bill relating to a county that borders or contains a portion of the Neches River, the Sabine River, and Sabine Lake. Three counties would meet the criteria relating to a county that borders Whitney Lake: Bosque County, Hill County, and Johnson County.
For the purpose of this estimate, the Comptroller gathered data on taxable hotel receipts from the counties from its tax files. To estimate the potential maximum gain to each county, the Comptroller multiplied the receipts by the two percent maximum tax rate authorized for Orange County and by the seven percent maximum tax rate authorized for Bosque, Hill, and Johnson Counties.
It is not known whether any of the counties authorized by the bill would approve a county hotel occupancy tax or at what rate. For the purpose of this estimate it is assumed that the counties would adopt a county hotel occupancy tax at the maximum rate authorized by the bill.
| Source Agencies: | 304 Comptroller of Public Accounts
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| LBB Staff: | JOB, DB, CT, SD, EB
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