H.B. No. 3118 amends the Texas Tax Code to expand the permissible uses of municipal hotel occupancy tax revenue in certain municipalities. The bill specifies that such revenue can be utilized for various tourism-related activities, including the construction and maintenance of convention centers, visitor information centers, and sports facilities, as well as advertising and promotional programs to attract tourists. Notably, the bill introduces new criteria for municipalities to qualify for these funds, including provisions for municipalities with populations of at least 9,000 that are located in counties where the State Capitol is situated and are adjacent to or bisected by State Highway 71.

Additionally, the bill removes previous criteria that limited eligibility based on population and geographic factors, thereby broadening the scope of municipalities that can access hotel occupancy tax revenue. The changes aim to enhance tourism and economic activity in a wider range of communities across Texas. The act is set to take effect immediately upon receiving a two-thirds vote from both houses of the legislature or on September 1, 2025, if such a vote is not achieved.

Statutes affected:
Introduced: Tax Code 351.101, Tax Code 351.1066 (Tax Code 351)
House Committee Report: Tax Code 351.101, Tax Code 351.1066 (Tax Code 351)