BILL ANALYSIS

H.B. 5321

By: Bell, Cecil

County Affairs

Committee Report (Unamended)

BACKGROUND AND PURPOSE

Certain municipalities in Texas are authorized to receive a rebate of state hotel occupancy taxes and state sales taxes collected at certain hotels, which may be used by the municipality to service bonds or other obligations incurred for the construction of a convention center or hotel. Given that financing convention centers and hotels is often challenging, this financing tool has proven valuable. An adequate supply of hotel rooms located near convention centers is needed to make the state more competitive in attracting events, conventions, and meetings, especially to Montgomery County. H.B. 5321 seeks to address this issue by authorizing the East Montgomery County Improvement District's board of directors by order to authorize proceeds from the district's hotel occupancy tax to be used for certain qualified projects.

CRIMINAL JUSTICE IMPACT

It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

H.B. 5321 amends the Special District Local Laws Code to authorize the East Montgomery County Improvement District's board of directors by order to authorize proceeds from the district's hotel occupancy tax to be used for a qualified project under municipal hotel occupancy tax provisions relating to municipal hotel and convention center projects. The bill establishes that such use is in addition to any other use authorized by law. The bill, if the board adopts such an order, provides the following:

· a reference in those provisions to a municipality is a reference to the district; and

· the district is considered to be a municipality for purposes of those provisions with the same rights, privileges, and responsibilities as a municipality under those provisions, including the ability to pledge or commit revenue for bonds or other obligations issued for a qualified project or contractual obligations for a qualified project and to receive certain tax revenue.

The bill establishes that the bill's provisions control in the event of a conflict between the provisions and another provision of the district's governing provisions.

EFFECTIVE DATE

On passage, or, if the bill does not receive the necessary vote, September 1, 2023.