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A BILL TO BE ENTITLED
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AN ACT
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relating to the use of hotel occupancy tax revenue by certain |
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municipalities. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 351.101, Tax Code, is amended by adding |
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Section 351.1080 to read as follows: |
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(a) This section applies only to a municipality that |
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(1) is the county seat of a county that borders New |
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Mexico and contains a portion of a state park that is located in two |
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counties; |
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(2) in the most recent completed fiscal year, hotel |
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occupancy levels within the municipality and its extraterritorial |
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jurisdiction exceeded 90 percent; |
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(3) in the most recent completed fiscal year, on |
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average, more than forty percent of the individuals within the |
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municipality and its extraterritorial jurisdiction stay within a |
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hotel within the municipality each night; and |
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(4) in the most recent completed fiscal year, |
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unexpended balances of municipal hotel occupancy tax revenue |
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exceeded $1.8 million. |
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(b) Notwithstanding any other provision of this chapter, a |
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municipality to which this section applies may use hotel occupancy |
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tax revenue collected by the municipality for a public improvement |
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project that will directly benefit the hotel and tourism industry. |
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(c) If a municipality to which this section applies uses |
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hotel occupancy tax revenue as provided by subsection (b): |
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(1) Not more than 25 percent of the public improvement |
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project's total costs may be funded with municipal hotel occupancy |
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tax revenue; and |
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(2) The municipality may not reduce the amount of |
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revenue that it uses for a purpose described by Section 351.101(a) |
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to an amount that is less than the average amount of revenue used by |
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the municipality for those purposes during the 36-month period that |
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precedes the municipality's use of revenue under Subsection (b). |
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(d) Within eight fiscal years of using municipal hotel |
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occupancy tax revenue for a purpose provided by subsection (b), a |
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municipality to which this section applies shall reduce the rate of |
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municipal hotel occupancy tax to no more than two percent of the |
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price paid for a room in a hotel and may not increase its municipal |
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hotel occupancy tax rate to no more than two percent of the price |
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paid for a room in a hotel. |
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(e) A municipality to which this section applies may not use |
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municipal hotel occupancy tax revenue for a purpose provided by |
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subsection (b) after December 31, 2034. |
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(f) This section shall expire on December 31, 2034, except |
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than subsection (d), which shall remain in effect. |
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SECTION 2. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2025. |