One Unnamed City Keeps State Tax Money For 20 Years

The text as introduced · 685 words

89R9098 RDS-F

By: Paxton
S.B. No. 1425

A BILL TO BE ENTITLED

AN ACT

relating to the entitlement of certain municipalities to certain

tax revenue associated with hotel and convention center projects.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 351.158, Tax Code, is amended to read as

follows:

Sec. 351.158. PERIOD OF ENTITLEMENT. (a) Except as

provided by Subsection (b), a [ 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.

(b) A municipality described by Section 351.152(46) is

entitled to receive revenue as provided by Sections 351.156 and

351.157 until the 20th anniversary of the date the qualified hotel

to which the entitlement relates is open for initial occupancy.

SECTION 2. Section 351.162, Tax Code, is amended by

amending Subsections (b) and (c) and adding Subsection (b-1) to

read as follows:

(b) Except as provided by Subsection (b-1), on [ On ] the 20th

anniversary of the date a hotel designated as a qualified hotel by a

municipality as part of a qualified project to which this section

applies is open for initial occupancy, the comptroller shall

determine:

(1) the total amount of state tax revenue received

under Section 351.156 and, if applicable, under Section 351.157 by

the municipality from the qualified project during the period for

which the municipality was entitled to receive that revenue; and

(2) the total amount of state tax revenue described by

Subdivision (1) received by the state during the period beginning

on the 10th anniversary of the date the qualified hotel opened for

initial occupancy and ending on the 20th anniversary of that date

from the same sources from which the municipality received the

revenue described by Subdivision (1).

(b-1) On the 40th anniversary of the date a hotel designated

as a qualified hotel by a municipality described by Section

351.152(46) as part of a qualified project to which this section

applies is open for initial occupancy, the comptroller shall

determine:

(1) the total amount of state tax revenue received

under Section 351.156 and, if applicable, under Section 351.157 by

the municipality from the qualified project during the period for

which the municipality was entitled to receive that revenue; and

(2) the total amount of state tax revenue described by

Subdivision (1) received by the state during the period beginning

on the 20th anniversary of the date the qualified hotel opened for

initial occupancy and ending on the 40th anniversary of that date

from the same sources from which the municipality received the

revenue described by Subdivision (1).

(c) If the amount determined under Subsection (b)(1) or

(b-1)(1), as applicable, exceeds the amount determined under

Subsection (b)(2) or (b-1)(2), as applicable , the comptroller shall

promptly provide written notice to the municipality stating that

the municipality must remit to the comptroller the difference

between those two amounts in the manner provided by this

subsection. The municipality shall, using money lawfully available

to the municipality for the purpose, remit monthly payments to the

comptroller in an amount equal to the total amount of municipal

hotel occupancy tax revenue received by the municipality from the

qualified hotel in the preceding month until the amount remitted to

the comptroller equals the total amount due as stated in the notice.

The first payment required under this subsection must be made not

later than the 30th day after the date the municipality receives the

notice from the comptroller. Subsequent payments are due on the

20th day of each month until the total amount stated in the notice

is paid. The comptroller shall prescribe the procedure a

municipality must use to remit a payment required by this

subsection to the comptroller.

SECTION 3. This Act takes effect immediately if it receives

a vote of two-thirds of all the members elected to each house, as

provided by Section 39, Article III, Texas Constitution. If this

Act does not receive the vote necessary for immediate effect, this

Act takes effect September 1, 2025.