By: Zaffirini, et al. S.B. No. 696
 
  (Guillen)
 
  Substitute the following for S.B. No. 696:  No.
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the imposition, rate, and use of hotel occupancy taxes
  in certain counties and municipalities; authorizing certain
  counties to impose a hotel occupancy tax; reducing the maximum rate
  of the hotel occupancy tax imposed by certain counties.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 351.10692, Tax Code, is amended by
  amending Subsections (a) and (c) and adding Subsection (e) to read
  as follows:
         (a)  This section applies only to:
               (1)  a municipality with a population of less than
  2,000 located in a county that:
                     (A) [(1)]  is adjacent to the county in which the
  State Capitol is located; and
                     (B) [(2)]  has a population of:
                           (i) [(A)]  not more than 25,000; or
                           (ii) [(B)]  at least 100,000 but not more
  than 200,000;
               (2)  a municipality located in a county with a total
  area of more than 6,000 square miles; and
               (3)  a municipality located in a county with a total
  area of more than 3,850 square miles but less than 4,000 square
  miles.
         (c)  A municipality that uses revenue from the municipal
  hotel occupancy tax for a purpose described by Subsection (b):
               (1)  shall make a good-faith estimate based on
  reasonable documentation of [determine] the annual amount of area
  hotel revenue attributable to dark skies related events and
  activities [for five years after the date the municipality first
  uses hotel occupancy tax revenue for a purpose described by
  Subsection (b)]; and
               (2)  may not spend municipal hotel occupancy tax
  revenue for the purposes described by Subsection (b) in an annual [a
  total] amount that exceeds the amount determined under Subdivision
  (1).
         (e)  A municipality that uses municipal hotel occupancy tax
  revenue under this section may not reduce the percentage of revenue
  from that tax allocated for a purpose described by Section
  351.101(a)(3) to a percentage that is less than the average
  percentage of the revenue from that tax allocated by the
  municipality for the purpose described by Section 351.101(a)(3)
  during the 36-month period preceding the date the municipality
  begins using revenue for a purpose described by this section.
         SECTION 2.  Section 352.002, Tax Code, is amended by
  amending Subsection (d) and adding Subsection (bb) to read as
  follows:
         (d)  The tax imposed by a county authorized by Subsection
  (a)(6) [(a)(4), (6)], (8), (9), (10), (11), (14), (15), (17), (19),
  (20), (21), (23), or (29) to impose the tax does not apply to a hotel
  located in a municipality that imposes a tax under Chapter 351
  applicable to the hotel.  This subsection does not apply to:
               (1)  a county authorized by Subsection (a)(6) to impose
  the tax that:
                     (A)  has a population of less than 40,000 and
  adjoins the most populous county in this state; or
                     (B)  has a population of more than 200,000 and
  borders the Neches River; or
               (2)  a county authorized by Subsection (a)(9) to impose
  the tax that has a population of more than 9,000.
         (bb)  The commissioners court of a county with a population
  of less than 60,000 in which an annual strawberry festival is held
  in a location that is not the county seat of the county may impose a
  tax as provided by Subsection (a).
         SECTION 3.  Section 352.003, Tax Code, is amended by adding
  Subsections (y) and (z) to read as follows:
         (y)  The tax rate in a county authorized to impose the tax
  under Section 352.002(a)(4) may not exceed two percent of the price
  paid for a room in a hotel.
         (z)  The tax rate in a county authorized to impose the tax
  under Section 352.002(bb) may not exceed two percent of the price
  paid for a room in a hotel.
         SECTION 4.  Section 352.102, Tax Code, is amended by
  amending Subsection (c) and adding Subsection (d) to read as
  follows:
         (c)  A county that borders the Republic of Mexico and that is
  further described by Section 352.002(a)(14):
               (1)  shall use at least one-third of the revenue
  collected each fiscal year from the tax imposed under this chapter
  for the purposes authorized by this chapter in unincorporated areas
  of the county; and
               (2)  may use revenue from the tax imposed under this
  chapter in the same manner that a municipality to which Section
  351.10692 applies may use revenue from the municipal hotel
  occupancy tax under that section.
         (d)  A county that borders the United Mexican States and that
  is further described by Section 352.002(a)(7) may use revenue from
  the tax imposed under this chapter in the same manner that a
  municipality to which Section 351.10692 applies may use revenue
  from the municipal hotel occupancy tax under that section.
         SECTION 5.  Subchapter B, Chapter 352, Tax Code, is amended
  by adding Sections 352.112 and 352.114 to read as follows:
         Sec. 352.112.  USE OF REVENUE: CERTAIN COUNTIES HOLDING AN
  ANNUAL STRAWBERRY FESTIVAL.  The revenue from a tax imposed under
  this chapter by a county authorized to impose the tax under Section
  352.002(bb) may be used only for the construction, enlarging,
  equipping, improvement, maintenance, repairing, and operation of a
  civic center with an arena used for rodeos, livestock shows, and
  agricultural expositions to substantially enhance hotel activity
  and encourage tourism.
         Sec. 352.114.  USE OF REVENUE: CERTAIN COUNTIES CONTAINING
  AN INDIAN RESERVATION.  (a)  In addition to the purposes authorized
  by this chapter, the revenue from a tax imposed under this chapter
  by a county authorized to impose the tax under Section
  352.002(a)(4) may be used to make repairs and improvements to the
  county airport or to provide reimbursement for repairs and
  improvements to the airport.
         (b)  A county to which this section applies may not use
  revenue from a tax imposed under this chapter for a purpose
  described by Subsection (a) in a total amount that would exceed the
  amount of hotel revenue in the county that is likely to be
  reasonably attributable to guests traveling through the airport
  during the 15-year period beginning on the date the county first
  uses the tax revenue for that purpose.
         (c)  A county to which this section applies may not use
  revenue from a tax imposed under this chapter for a purpose
  described by Subsection (a) after the 10th anniversary of the date
  the county first uses the revenue for that purpose.
         SECTION 6.  Section 351.1035, Tax Code, is repealed.
         SECTION 7.  This Act takes effect September 1, 2021.