Acts 2017, 85th Leg., R.S., Ch. 30.274, eff. 50 (S.B. A municipality is entitled to receive revenue as provided by Sections 351.156 and 351.157 until the 10th anniversary of the date the qualified hotel to which the entitlement relates is open for initial occupancy. Other Liles Parker attorneys and staff also have experience representing Texas cities and municipalities. 1330 (S.B. (3) "Eligible coastal municipality" means a home-rule municipality that borders on the Gulf of Mexico and has a population of less than 80,000. ALLOCATION OF REVENUE: CERTAIN MUNICIPALITIES IN BORDER COUNTIES. (e) Notwithstanding any other provision of this chapter, a municipality to which this section applies may use all or any portion of the revenue derived from the municipal hotel occupancy tax from hotels in an area previously subject to a county hotel occupancy tax and located on an island bordering the Gulf of Mexico to clean and maintain public beaches in the municipality. (c) A municipality may use for the purposes provided by Subsections (b)(1), (2), and (3) not more than the greater of: (1) 15 percent of the hotel occupancy tax revenue collected by the municipality; or. (m-1) A municipality described by Subsection (m) that issues obligations secured wholly or partly by revenue derived from the tax authorized by this chapter for a use described by that subsection may use that revenue for those uses as long as the obligations are outstanding even if the municipality is no longer a municipality described by that subsection. 1247 (H.B. 1467, Sec. June 15, 2017. (3) substantially enhances hotel activity and encourages tourism within the municipality. (iii) acquiring a property right, including a fee simple interest, easement, or other interest in connection with a purpose described by this subdivision. Use of Municipal Hotel Occupancy Tax Revenue - Olson & Olson LLP 2, eff. (g) Repealed by Acts 2019, 86th Leg., R.S., Ch. This two-part test should be applied to every proposed used of Hotel Occupancy Tax funds for a particular project. Acts 2009, 81st Leg., R.S., Ch. 209, Sec. window.SMITH = {},window.SMITH.smithChatAccount="b2dea44c-6332-4a35-804a-65c6959bc8e4"; (2) "Qualified convention center facility" means a facility that has been or will be constructed and that: (A) is primarily used to host conventions or meetings; (B) is wholly owned by a municipality to which this subchapter applies, and none of which is or may be owned through an undivided common interest; (C) is connected to a qualified hotel or has an exterior wall that is located not more than 1,000 feet from the nearest exterior wall of a qualified hotel; (D) is not located in a hotel, sports stadium, or other structure but may share common infrastructure or facilities with a hotel, such as a heating, ventilation, and air-conditioning system, electrical system, or kitchen; (E) has at least 10,000 square feet of continuous meeting space; and. (2) the mixed beverage tax issued under Section 183.051, if the political subdivision that is entitled to receive the revenue from the tax agrees in writing to the municipality receiving that revenue. 351.001. 351.002. ENTITLEMENT TO CERTAIN TAX REVENUE. 1004, Sec. The nine categories for expenditure of the hotel occupancy tax are as follows: Funding the establishment, improvement, or maintenance of a convention center or visitor information center. Sept. 1, 1995; Acts 1999, 76th Leg., ch. (b) A state governmental entity described in Section 156.103(b) shall pay the tax imposed by this chapter but is entitled to a refund of the tax paid. 1, eff. (2) providing the comptroller a direct link to, or a clear statement describing the location of, the information required to be reported that is posted on the Internet website of the municipality. 4103), Sec. 939 (H.B. (9) "Revenue" includes any interest derived from the revenue. (b) A municipality may contract with a third party to assist in the creation, maintenance, operation, or administration of the electronic tax administration system. ALLOCATION OF REVENUE FOR THE ARTS BY CERTAIN MUNICIPALITIES. (a-2) If the person did not file a tax report under Section 156.151 for that reporting period in relation to that hotel, the municipality may estimate the amount of tax due by using the tax reports in relation to that hotel filed during the previous calendar year under this chapter or Section 156.151. The term includes a hotel, motel, tourist home, tourist house, tourist court, lodging house, inn, rooming house, or bed and breakfast. Added by Acts 2019, 86th Leg., R.S., Ch. (5) "Tourism" means the guidance or management of tourists. Acts 2017, 85th Leg., R.S., Ch. (c) A municipality to which this section applies that spends more than 15 percent of the hotel occupancy tax revenue collected by the municipality in a fiscal year for the purposes provided by Section 351.101(a)(4): (1) may not in that fiscal year reduce the percentage of hotel occupancy tax revenue that the municipality spends for the purposes described by Section 351.101(a)(3) to a percentage that is less than the average percentage of hotel occupancy tax revenue spent by the municipality for those purposes during the 36-month period preceding that fiscal year; and. Acts 2017, 85th Leg., R.S., Ch. (d) Notwithstanding any other provision of this chapter and except as provided by Subsection (e), an eligible barrier island coastal municipality shall use at least the amount of revenue derived from the application of the tax at a rate of seven percent of the cost of a room for the purposes authorized under Sections 351.101(a)(1) and (3) and Sections 351.1054(b)(1) and (2). 21.001(67), eff. 751 (H.B. Sept. 1, 2001. (2) the construction, enlarging, equipping, improvement, maintenance, repairing, and operation of an arena used for rodeos, livestock shows, and agricultural expositions to substantially enhance hotel activity and encourage tourism. 1247), Sec. 2445), Sec. 76, Sec. 2, eff. The suits claim that hotel occupancy tax should be paid on the amount of hotel reservation transactions that accrues to the OTC, described variously as a facilitation fee, service fee, commission, markup, or difference between the "retail" and "wholesale" rates. The tax, as all other taxes, was created as a way to increase government revenues. (C) the municipality has a population of at least 200,000 and shares a border with: (i) a municipality described by Section 351.102(e)(7); and. 351 (H.B. While funding a shelter is a worthy cause, it is unlikely that the promotion of a shelter will directly enhance and promote the attraction of tourists to the city. (3) may only spend hotel occupancy tax revenue for operational expenses of the facility or field if the costs are directly related to a sporting event in which the majority of participants are tourists who substantially increase economic activity at hotels in or near the municipality. In this subchapter: (A) a road, street, highway, bridge, overpass, underpass, and interchange; (B) a fresh, reuse, or alternative water supply system, sanitary sewer system, and storm drainage system; (C) an electric system, telecommunications system, and gas system; (D) signage, landscaping, and hardscaping; and. June 19, 2009. The comptroller may make deposits to the account and the municipality may request disbursements from the account on a monthly basis based on the estimate. 733 0 obj <>/Filter/FlateDecode/ID[<5CECE7A9BEB3244A8377C7A8FD0B6B07><5819E22C105CEA46A8427D129986C1A7>]/Index[714 43]/Info 713 0 R/Length 98/Prev 205271/Root 715 0 R/Size 757/Type/XRef/W[1 3 1]>>stream Sec. 1, eff. The hotel occupancy tax, imposed at the same rate as sales tax, applies to room rental charges for periods of less than 30 days by the same person. Local HOT revenue may only be used to promote tourism and the convention and hotel industries. September 1, 2011. 1896), Sec. (2) is directly enhancing and promoting tourism and the convention and hotel industry. (a) This section applies only to a municipality described by Section 351.102(e) or 351.152, other than an eligible central municipality described by Section 351.001(7)(D). Acts 2013, 83rd Leg., R.S., Ch. Sec. (3) expenses directly related to the construction, improvement, equipping, repairing, operation, and maintenance of coastal sports facilities owned by the municipality, including boat docks, boat ramps, and fishing piers used by hotel guests, if: (A) the coastal sports facilities have been used in the preceding calendar year a combined total of more than five times for district, state, regional, or national sports tournaments or events; and. Acts 2017, 85th Leg., R.S., Ch. 14.24(a), eff. How does that work? (3) if a political subdivision that is entitled to receive the revenue from the tax agrees in writing to the municipality receiving that revenue: (A) the sales and use tax imposed by the political subdivision under Chapter 322 or 323; (B) the hotel occupancy tax imposed by the political subdivision under Chapter 352; and. 351.1075. Notwithstanding any other law, the municipality is entitled to receive the funds for a period of 30 years beginning on the date the hotel project is open for initial occupancy. (a) This section applies only to a municipality: (1) a portion of which is designated as a cultural arts district; and. The municipality or local government corporation is entitled to receive the funds for a period of 10 years beginning on the date the multipurpose convention center facility is issued a certificate of occupancy. How Can Georgias Small Cities Survive in The Future? Acts 2011, 82nd Leg., R.S., Ch. (a) Subject to the limitations provided by this subchapter, a municipality may pledge the revenue derived from the tax imposed under this chapter for the payment of bonds that are issued under Section 1504.002(a), Government Code, for one or more of the purposes provided by Section 351.101 or, in the case of a municipality of 1,500,000 or more, for the payment of principal of or interest on bonds or other obligations of a municipally sponsored local government corporation created under Chapter 431, Transportation Code, that were issued to pay the cost of the acquisition and construction of a convention center hotel or the cost of acquisition, remodeling, or rehabilitation of a historic hotel structure; provided, however, such pledge may only be that portion of the tax collected at such hotel. (g-1) A municipality may not require a person that receives funds directly from the municipality through a grant to conduct an activity authorized by Subsection (a)(4) to waive a right guaranteed by law to the person or to enter into an agreement with another person. (a) Except as provided by this section, the tax authorized by this chapter may be imposed at any rate not to exceed seven percent of the price paid for a room in a hotel. The following section was amended by the 88th Legislature. 382, Sec. (c) does not have a municipality with a population greater than 500,000; (vii) has a population of at least 25,000 but not more than 26,000 and is located in a county that has a population of 90,000 or less; (viii) is located in a county that has a population of not more than 300,000 and in which a component university of the University of Houston System is located; (ix) has a population of at least 40,000 and the San Marcos River flows through the municipality; (x) has a population of more than 67,000 and is located in two counties with 90 percent of the municipality's territory located in a county with a population of at least 580,000, and the remaining territory located in a county with a population of at least four million; (xi) contains an intersection of Interstates 35E and 35W and at least two public universities; or, (xii) is described by Subdivision (6)(C); and. Hotel owners, operators or managers must collect state hotel occupancy tax from their guests who rent a room or space in a hotel costing $15 or more each day. ADDITIONAL ENTITLEMENT FOR CERTAIN MUNICIPALITIES. Should you have questions regarding this article, please call Leonard Schneider for a complimentary consultation. (b) This section applies only to a qualified project located in a municipality with a population of at least 650,000 but less than 750,000 according to the most recent federal decennial census. (d) A person with whom a municipality contracts under this section to conduct an activity authorized by this section shall maintain complete and accurate financial records of each expenditure of hotel occupancy tax revenue made by the person and, on request of the governing body of the municipality or other person, shall make the records available for inspection and review to the governing body or other person. ALLOCATION OF REVENUE: CERTAIN MUNICIPALITIES. 227 (S.B. 4347), Sec. For many counties, the rules for using the county hotel occupancy tax are the same as the general rules applicable to cities for use of this tax. (g) The comptroller shall deposit incremental hotel-associated revenue collected by or forwarded to the comptroller in a separate suspense account to be held in trust for the municipality that is entitled to receive the revenue. What about donating Hotel Occupancy Tax funds to advertise a weekend long folk music festival in the city that attracts out-of-town artists and folk music lovers? TAX COLLECTION. (3) issued bonds before January 1, 2007, for the construction of a municipal arts center payable from and secured by revenue from the tax imposed under this chapter. 4559, 88th Legislature, Regular Session, for amendments affecting the following section. 1163 (H.B. (d) The comptroller may adopt rules necessary to administer this section. 776 (H.B. June 9, 2017. DEFINITIONS. ALLOCATION OF REVENUE; CERTAIN MUNICIPALITIES. 7, eff. (b) Any interest income derived from the application of the tax at a rate of more than seven percent of the cost of a room may be used only for the purposes provided by this section. (a) In addition to the authority of a municipality to issue debt under Chapter 1504, Government Code, a municipality may pledge or commit the revenue derived from the tax imposed under this chapter from a qualified hotel and the revenue to which the municipality is entitled under Section 351.156 and, if applicable, Section 351.157 for the payment of: (1) bonds or other obligations issued for a qualified project; and. When you hear the term "occupancy tax" you may immediately think of a hotel or motel, but this tax applies to all businesses that provide accommodations for customers, and that means vacation rentals. 1271 (H.B. This is based on Tax Code Section 352.1031, that states that unless otherwise provided, the county hotel occupancy tax can only be used for the purposes authorized under September 1, 2019. Added by Acts 1987, 70th Leg., ch. 1004 (H.B. Acts 2009, 81st Leg., R.S., Ch. ALLOCATION OF REVENUE: CERTAIN MUNICIPALITIES. (f) The rate in a municipality that has a population of at least 80,000 and is partly located in a county that borders the State of Louisiana and has a population of at least 60,000 may not exceed nine percent of the price paid for a room. 405 (S.B. var script = document.createElement('script'); MUNICIPAL HOTEL OCCUPANCY TAXES SUBCHAPTER A. (e) An eligible barrier island coastal municipality that imposes the tax at a rate equal to or greater than 7-1/2 percent of the price paid for a room shall use at least the amount of revenue derived from the application of the tax at a rate of one-half of one percent of the cost of a room for erosion response projects. (C) the mixed beverage tax issued under Section 183.051. (a) This section applies only to a municipality that has a population of at least 190,000, no part of which is located in a county with a population of at least 150,000. (e) The rate in a municipality that has a population of more than 95,000 and is in a county that borders Lake Palestine and has a population of more than 200,000 may not exceed nine percent of the price paid for a room. 1, eff. ALLOCATION OF REVENUE: ELIGIBLE COASTAL MUNICIPALITIES. (2) "Hotel-associated revenue" means the sum of: (A) state tax revenue collected in a project financing zone from all hotels located in the zone that would be available to the owners of qualified hotel projects under Section 151.429(h) if the hotels were qualified hotel projects, excluding the amount of that revenue received by a municipality under Section 351.102(c) for a hotel project described by Section 351.102(b) and located in the zone that exists on the date the municipality designates the zone; and. Sec. Sept. 1, 2003. 1, eff. Sec. Sec. 5012, S.B. 2, eff. A multipurpose convention center facility project may include: (A) each new or existing business located in the municipality, regardless of who owns the business or the property on which the business is located, the nearest exterior wall of which is located not more than 2,500 feet from the nearest exterior wall of the multipurpose convention center facility or the hotel that is part of the project; (B) a parking shuttle or transportation system; and. (d) A municipality to which this section applies may not reduce the amount of revenue that an arts center that receives funds under Subsection (b) spends for a purpose described by Section 351.101(a)(3) to an amount that is less than the amount of revenue spent by the arts center for those purposes during the fiscal year of the arts center preceding the effective date of this section. June 16, 2021. June 19, 2015. September 1, 2019. "Transient occupancy tax" is paid on temporary lodging at hotels, motels, inns, hostels and similar places. Sec. Added by Acts 2007, 80th Leg., R.S., Ch. (C) the boundaries of which are within 30 miles of the United Mexican States. 2, eff. Sec. 8, eff. (2) at least part of which is located less than one-eighth of one mile from a space center operated by an agency of the federal government. 3, eff. 3643), Sec. (b) Notwithstanding any other provision of this chapter, a home-rule municipality that borders on the Gulf of Mexico and has a population of more than 250,000 may use all or any portion of the revenue derived from the municipal hotel occupancy tax from hotels in an area previously subject to a county hotel occupancy tax and located on an island bordering the Gulf of Mexico to clean and maintain public beaches in the municipality. Added by Acts 2017, 85th Leg., R.S., Ch. 231, Sec. See July 1, 2003. (a) A municipality with a population of less than 35,000 by ordinance may impose the tax authorized under Section 351.002 in the municipality's extraterritorial jurisdiction. (4) tourist attractions in or near the municipality. (d) A municipality may not use municipal hotel occupancy tax revenue on an authorized facility in a total amount that would exceed the amount of hotel revenue attributable to events at that facility for the 15-year period following the completion of construction. June 1, 2017. 1, eff. (b) The price of a room in a hotel does not include the cost of food served by the hotel and the cost of personal services performed by the hotel for the person except for those services related to cleaning and readying the room for use or possession. QUARTERLY PAYMENTS. June 19, 2009. (q) In addition to the purposes provided by Subsections (a) and (e), a municipality with a population of more than 10,000 that has a city hall located less than three miles from a space center operated by an agency of the federal government and that is wholly located in a county with a population of four million or more may use revenue from the hotel occupancy tax for the construction, improvement, enlarging, equipping, renovating, repairing, operation, and maintenance of a coliseum or multiuse facility and related infrastructure or a venue, as defined by Section 334.001(4), Local Government Code, that is related to the promotion of tourism, including a hotel, resort, or convention center facility located on land owned by the municipality or a nonprofit corporation acting on behalf of the municipality. (iii) has adopted a capital improvement plan to expand an existing convention center facility; (C) a municipality with a population of 116,000 or more that: (i) is located in two counties both of which have a population of 660,000 or more; and. 970 (H.B. June 17, 2015. 1262), Sec. 351.1012. (a) Tax imposed upon occupants. 942), Sec. Sept. 1, 1993; Acts 1995, 74th Leg., ch. Acts 2011, 82nd Leg., R.S., Ch. (c) A municipality to which this section applies may use revenue derived from the municipal hotel occupancy tax to: (1) maintain or operate sports facilities and fields only if the conditions specified by Sections 351.101(a)(7)(A) and (C) are met; and. Sept. 1, 1987. Sec. That revenue may not be used for the general revenue purposes or general governmental operations of a municipality. 680, Sec. (B) the total amount of that revenue received in the fiscal year. September 1, 2017. (e) The comptroller may make a rebate, refund, or payment authorized under this section without the necessity of an appropriation. 127 (S.B. September 1, 2013. Aug. 30, 1993; Acts 1993, 73rd Leg., ch. 3, eff. June 16, 2001; Acts 2003, 78th Leg., ch. (18) a municipality with a population of 56,000 or more that: (B) is located in two counties, one of which has a population of less than 80,000; (19) a municipality with a population of 83,000 or more that: (B) is primarily located in a county with a population of less than 300,000; (20) a municipality with a population of less than 2,000 that: (21) a municipality with a population of 75,000 or more that: (A) is located wholly in one county with a population of 575,000 or more that is adjacent to a county with a population of four million or more; and. Added by Acts 1991, 72nd Leg., ch. June 17, 2015. June 15, 2017. Acts 2013, 83rd Leg., R.S., Ch. 785 (H.B. (12) "Retail establishment" means an establishment engaged in activities described by North American Industry Classification System subsector code 442, 443, 445, 446, 448, 451, 452, or 453. June 17, 2015. May 22, 2017. 4347), Sec. Sec. 970), Sec. This tax has historically been collected by local governments. (B) the event substantially increases economic activity at hotels and motels within or in the vicinity of the municipality; (A) the acquisition of sites to observe spacecraft and spaceport activities; and, (B) the construction, improvement, enlarging, equipping, repairing, operation, and maintenance of facilities utilized by hotel guests to observe and learn about spacecraft and spaceport operations; and. If you don't pay on time, interest and penalties will be added to the amount you owe. 1, eff. Pending publication of the current statutes, see H.B. Added by Acts 2015, 84th Leg., R.S., Ch. Acts 2017, 85th Leg., R.S., Ch. June 18, 2003. 1, eff. 14 (S.B. 1315), Sec. The City of Dallas collects an additional 7 percent HOT tax as well as a 2 percent Tourism Public Improvement District fee in some areas. Guests who occupy a hotel room for 30 or more consecutive days are considered permanent residents and are exempt from hotel tax as long as there is no interruption of payment during that period. (4) "Erosion response project" has the meaning assigned by Section 33.601, Natural Resources Code. (2) pay bonds issued for a purpose described by Subdivision (1). Part III will address the management of Hotel Occupancy Tax funds and fiduciary duty in the managing of these funds. 3727, S.B. Sec. In 2018, the State of Texas collected $24 million In HOT tax from the Airbnb platform only. PLEDGE FOR BONDS. 303, Sec. (b) A municipality described by Subsection (e) may pledge the revenue derived from the tax imposed under this chapter from a hotel project that is owned by or located on land owned by the municipality or, in an eligible central municipality, by a nonprofit corporation acting on behalf of an eligible central municipality, and that is located within 1,000 feet of a qualified convention center facility, as defined by Section 351.151, owned by the municipality for the payment of bonds or other obligations issued or incurred to acquire, lease, construct, and equip the hotel and any facilities ancillary to the hotel, including convention center entertainment-related facilities, restaurants, retail establishments, street and water and sewer infrastructure necessary for the operation of the hotel or ancillary facilities, and parking facilities within 1,000 feet of the hotel or convention center facility. 1420, Sec. Occupant - shall mean any person, (including corporations and other legal entities) who pays for the use of a room in a hotel. (2) "Convention center facilities" or "convention center complex" means facilities that are primarily used to host conventions and meetings. (2) improve a sports facility or field only if the requirements of Sections 351.101(a)(7)(A) and (C) are met and the municipality complies with Section 351.1076. 8.365, eff. 351.105. Sept. 1, 1987. Acts 2013, 83rd Leg., R.S., Ch. September 1, 2005. 952 (H.B. Sept. 1, 1993; Acts 2001, 77th Leg., ch. 4, eff. Acts 2019, 86th Leg., R.S., Ch. 1087 (H.B. (3) the sports facilities and fields have been used, in the preceding calendar year, a combined total of more than 10 times for district, state, regional, or national sports tournaments. 4347), Sec. 4, eff. The term also includes a hotel that is owned in part by an eligible central municipality described by Subdivision (7)(D) and that is located within 1,000 feet of a convention center facility. (3) is adjacent to two or more counties, each of which has a population of 50,000 or more. Acts 2019, 86th Leg., R.S., Ch. Acts 2017, 85th Leg., R.S., Ch. (m) In addition to the uses authorized by Subsections (a) and (e), and notwithstanding any provision of this chapter to the contrary, a municipality with a population of 6,500 or less that has at least 800 hotel rooms within the corporate boundaries of the municipality and that is located in a county adjacent to a county with a population of 3.3 million or more may use revenue derived from the tax authorized by this chapter to directly enhance and promote tourism and the convention and hotel industry by acquiring sites for and constructing, improving, enlarging, equipping, repairing, operating, and maintaining a municipally owned: (2) sports-related facility with seating for at least 4,500 people that is used or is planned for use for one or more professional or amateur sports events or other events, including rodeos, livestock shows, and performing arts events; (3) multiuse facility that includes facilities described by Subdivisions (1) and (2); and. (B) the municipality has not received a disbursement from the comptroller as provided by Section 156.2513 related to the person's concurrent state tax delinquency described by Section 351.008; (3) a penalty equal to 15 percent of the total amount of the tax owed if the tax has been delinquent for at least one complete municipal fiscal quarter; and. Amended by Acts 1993, 73rd Leg., ch. 1, eff. (a) In this section, "qualified establishment" means an establishment: (B) owned by any person if the establishment is located in a municipality described by Section 351.152(3) or owned by the federal government if the establishment is located in a municipality described by Section 351.152(6); (2) the nearest exterior wall of which is located not more than 1,000 feet from the nearest exterior wall of a qualified hotel or qualified convention center facility; (A) on or after the date the municipality commences a qualified project under this subchapter; or.
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what can hotel occupancy tax be used for
