By: Nelson S.B. No. 748
(In the Senate - Filed February 22, 2013; February 26, 2013,
read first time and referred to Committee on Economic Development;
March 25, 2013, reported adversely, with favorable Committee
Substitute by the following vote: Yeas 5, Nays 0; March 25, 2013,
sent to printer.)
COMMITTEE SUBSTITUTE FOR S.B. No. 748 By: Hancock
A BILL TO BE ENTITLED
AN ACT
relating to the use of certain tax revenue to enhance and upgrade
convention center facilities, multipurpose arenas, multiuse
facilities, and related infrastructure in certain municipalities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter B, Chapter 351, Tax Code, is amended
by adding Section 351.1015 to read as follows:
Sec. 351.1015. CERTAIN QUALIFIED PROJECTS. (a) In this
section:
(1) "Base year amount" means the amount of
hotel-associated revenue collected in a project financing zone
during the calendar year in which a municipality designates the
zone.
(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
(B) tax revenue collected from all permittees
under Chapter 183 at hotels located in the zone, excluding revenue
disbursed by the comptroller under Section 183.051(b).
(3) "Incremental hotel-associated revenue" means the
amount in any calendar year by which hotel-associated revenue,
including hotel-associated revenue from hotels built in the project
financing zone after the year in which a municipality designates
the zone, exceeds the base year amount.
(4) "Project financing zone" means an area within a
municipality:
(A) that the municipality by ordinance or by
agreement under Chapter 380, Local Government Code, designates as a
project financing zone;
(B) the boundaries of which are within a
three-mile radius of the center of a qualified project;
(C) the designation of which specifies the
longitude and latitude of the center of the qualified project; and
(D) the designation of which expires not later
than the 30th anniversary of the date of designation.
(5) "Qualified project" means a convention center
facility, a multipurpose arena, a multiuse facility, and any
related infrastructure or a venue as defined by Section 334.001,
Local Government Code, that is:
(A) located on land owned by a municipality or by
the owner of the venue;
(B) if the project is not a convention center
facility, partially financed by private contributions that equal
not less than 40 percent of the project costs; and
(C) related to the promotion of tourism and the
convention and hotel industry.
(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.
(c) In addition to the uses provided by Section 351.101,
revenue from the municipal hotel occupancy tax may be used to fund a
qualified project.
(d) A municipality may pledge the revenue derived from the
tax imposed under this chapter from a hotel located in the project
financing zone for the payment of bonds or other obligations issued
or incurred to acquire, lease, construct, improve, enlarge, and
equip the qualified project.
(e) A municipality may pledge for the payment of bonds or
other obligations described by Subsection (d) the local revenue
from eligible tax proceeds as defined by Section 2303.5055(e),
Government Code, from hotels located in a project financing zone
that would be available to the owners of qualified hotel projects
under that section if the hotels were qualified hotel projects,
excluding any amount received by the municipality 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.
(f) A municipality shall notify the comptroller of the
municipality's designation of a project financing zone not later
than the 30th day after the date the municipality designates the
zone. Notwithstanding other law, the municipality is entitled to
receive the incremental hotel-associated revenue from the project
financing zone for the period beginning on the first day of the year
after the year in which the municipality designates the zone and
ending on the last day of the month during which the designation
expires. The municipality may pledge the revenue for the payment of
bonds or other obligations described by Subsection (d).
(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. The
suspense account is outside the state treasury, and the comptroller
may make a payment authorized by this section from the account
without the necessity of an appropriation. The comptroller shall
begin making payments from the suspense account to the municipality
for which the money is held on the date the qualified project in the
project financing zone is commenced. If the qualified project is
not commenced by the fifth anniversary of the first deposit to the
account, the comptroller shall transfer the money in the account to
the general revenue fund and cease making deposits to the account.
(h) The comptroller may estimate the amount of incremental
hotel-associated revenue that will be deposited to a suspense
account under Subsection (g) during each calendar year. 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. At the end of each calendar year, the comptroller
shall adjust the deposits and disbursements to reflect the amount
of revenue actually deposited to the account during the calendar
year.
(i) A municipality shall notify the comptroller if the
qualified project in the project financing zone is abandoned. If
the qualified project is abandoned, the comptroller shall transfer
to the general revenue fund the amount of money in the suspense
account that exceeds the amount required for the payment of bonds or
other obligations described by Subsection (d).
SECTION 2. Subsection (a), Section 351.1065, Tax Code, is
amended to read as follows:
(a) An eligible central municipality shall use the amount of
revenue from the tax that is derived from the application of the tax
at a rate of more than seven percent of the cost of a room only for:
(1) the construction of an expansion of an existing
convention center facility; [and]
(2) a qualified project to which Section 351.1015
applies; and
(3) pledging payment of revenue bonds and revenue
refunding bonds issued under Subchapter A, Chapter 1504, Government
Code, for the construction or qualified project [of the expansion].
SECTION 3. This Act takes effect September 1, 2013.
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