H.B. No. 2974 seeks to amend the Local Government Code and Tax Code concerning municipal and county hotel occupancy taxes, particularly focusing on the authority of certain municipalities to collect tax revenue from hotel and convention center projects. The bill allows municipalities with populations between 70,000 and 180,000, as well as those with populations not exceeding 25,000 that house a cultural heritage museum, to impose taxes to finance convention centers built before specified dates. The authority to impose these taxes will expire upon repayment of related debt or by set future dates (January 1, 2054, or January 1, 2056). Additionally, the bill introduces restrictions on municipalities pledging revenue for more than one qualified project under certain conditions and mandates that funds from hotel occupancy taxes be used equitably.

The bill also modifies existing regulations regarding revenue commitments for hotel and multipurpose convention center projects, stipulating that municipalities can only commit revenue for one project unless authorized by future legislation. It introduces new criteria for municipalities based on population and geographic characteristics, while removing outdated provisions. Notably, it expands the list of municipalities eligible to impose hotel occupancy taxes and allows certain counties in Texas to impose these taxes under specific conditions. The revenue generated can be used for various purposes, including civic center construction and tourism promotion. The act will take effect immediately upon a two-thirds majority vote or on September 1, 2025, if that threshold is not met.

Statutes affected:
Introduced: Tax Code 351.155, Tax Code 351.157 (Tax Code 351)
House Committee Report: Tax Code 351.155, Tax Code 351.157 (Tax Code 351)
Engrossed: Local Government Code 334.0082, Tax Code 351.101, Tax Code 351.1066, Tax Code 351.10712, Tax Code 351.152, Tax Code 351.153, Subchapter C, Chapter , Tax Code 351.152, Tax Code 351.155, Tax Code 351.157, Tax Code 351.158, Tax Code 352.002, Tax Code 352.003, Subchapter B, Chapter , Tax Code 351.0025, Tax Code 351.1035 (Subchapter C, Chapter , Tax Code 351, Subchapter B, Chapter , Tax Code 351, Tax Code 351, Local Government Code 334, Tax Code 352)
Senate Committee Report: Local Government Code 334.0082, Tax Code 156.2511, Tax Code 351.101, Tax Code 351.1015, Tax Code 351.102, Tax Code 351.1021, Tax Code 351.1022, Tax Code 351.106, Tax Code 351.1066, Tax Code 351.10712, Tax Code 351.152, Tax Code 351.155, Tax Code 351.157, Tax Code 352.003, Subchapter B, Chapter , Tax Code 351.0025, Tax Code 351.1035 (Subchapter C, Chapter , Tax Code 351, Tax Code 156, Subchapter B, Chapter , Tax Code 351, Tax Code 351, Local Government Code 334, Tax Code 352)