HB 4095

relating to the rate of the hotel occupancy tax in certain
municipalities and the use of certain revenue from that tax by those
municipalities; authorizing an increase in the rate of a tax.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1.  Section 351.003, Tax Code, is amended by adding
Subsection (g) to read as follows:
(g)  This subsection applies only to an eligible coastal
municipality that has a population of 5,000 or less and in which a
ferry system that is a part of the state highway system is located.
The rate in a municipality to which this subsection applies may
exceed the rate authorized by Subsection (a), but may not exceed
eight percent of the price paid for a room, if a temporary increase
in the tax rate is approved by a majority of the voters of the
municipality voting at an election held for that purpose.  This
subsection expires December 31, 2035.
SECTION 2.  Section 351.105, Tax Code, is amended by
amending Subsection (a) and adding Subsections (h), (i), and (j) to
(a)  An eligible coastal municipality that levies and
collects an occupancy tax authorized by this chapter at a rate of
seven percent shall pledge a portion of the revenue equal to at
least one percent of the cost of a room to either or both of the
(1)  the payment of the bonds that the municipality or a
park board of trustees may issue under Section 1504.002(a),
Government Code, or under Chapter 306, Local Government Code, in
order to provide all or part of the funds for the establishment,
acquisition, purchase, construction, improvement, enlargement,
equipment, or repair of public improvements, including parks, civic
centers, civic center buildings, auditoriums, exhibition halls,
coliseums, marinas, cruise ship terminal facilities, hotels,
motels, parking facilities, streetscapes, golf courses, trolley or
trolley transportation systems, and other facilities as may be
considered advisable in connection with these facilities that serve
the purpose of attracting visitors and tourists to the
(2)  the maintenance, improvement, or operation of the
parks, civic centers, civic center buildings, auditoriums,
exhibition halls, coliseums, marinas, cruise ship terminal
facilities, hotels, motels, parking facilities, streetscapes, golf
courses, trolley or trolley transportation systems, and other
facilities as may be considered advisable in connection with these
facilities that serve the purpose of attracting visitors and
(h)  If the tax authorized by this chapter is imposed by an
eligible coastal municipality to which Section 351.003(g) applies
at a rate of more than seven percent of the cost of a room, the
municipality may, subject to Subsection (i), use all or part of the
revenue derived from the application of the tax at a rate of more
than seven percent for the beautification of streetscapes and the
improvement of the municipality's main streets, including
improvements relating to pedestrian safety and accessibility.
(i)  A municipality described by Subsection (h) may not spend
more revenue for the purposes described by that subsection during a
calendar year than the total amount the municipality spends for
those purposes from all other sources of funds.
(j)  Subsections (h) and (i) and this subsection expire
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.