34 Tex. Admin. Code § 3.12 - Hotel Projects, Project Financing Zones, and Qualified Hotel Projects

(a) Hotel Projects.

(1) Definitions. The following words and terms, when used in this subsection, shall have the following meanings, unless the context clearly indicates otherwise.

(A) Convention center entertainment-related facilities--Facilities owned by or located on land owned by the municipality or the nonprofit corporation acting on behalf of an eligible central municipality, and designed and primarily used for convention center events, activities, and performances. Examples of this term are a performance hall, permanent or temporary stage, amphitheater, and pavilion. The term does not include facilities designed for a specific use. Examples of facilities that do not meet this definition include an amusement park, fitness or sports center, museum, sports venue, waterpark, or zoo.

(B) Convention center facilities--Facilities primarily used to host conventions and meetings. The term means civic centers, civic center buildings, auditoriums, exhibition halls, and coliseums that are owned by the municipality or other governmental entity or that are managed in whole or part by the municipality.

(i) The term includes parking areas or facilities that are for the parking or storage of conveyances and that are located at or in the vicinity of other convention center facilities.

(ii) The term also means:

(I) a hotel owned by or located on land that is owned by an eligible central municipality or by a nonprofit corporation acting on behalf of an eligible central municipality and that is located within 1,000 feet of a convention center facility owned by the municipality; or

(II) a hotel that is owned in part by an eligible central municipality described by subparagraph (C)(iv) of this paragraph and that is located within 1,000 feet of a convention center facility.

(iii) For the purpose of this subparagraph, "meetings" means gatherings of people that enhance and promote tourism and the convention and hotel industry.

(C) Eligible central municipality--

(i) A municipality with a population of more than 140,000 but less than 1.5 million that is located in a county with a population of one million or more and that has adopted a capital improvement plan for the construction or expansion of a convention center facility;

(ii) a municipality with a population of 250,000 or more that:

(I) is located wholly or partly on a barrier island that borders the Gulf of Mexico;

(II) is located in a county with a population of 300,000 or more; and

(III) has adopted a capital improvement plan to expand an existing convention center facility;

(iii) a municipality with a population of 116,000 or more that:

(I) is located in two counties both of which have a population of 660,000 or more; and

(II) has adopted a capital improvement plan for the construction or expansion of a convention center facility;

(iv) a municipality with a population of less than 50,000 that contains a general academic teaching institution that is not a component institution of a university system, as those terms are defined by Education Code, § 61.003(Definitions); or

(v) a municipality with a population of 640,000 or more that:

(I) is located on an international border; and

(II) has adopted a capital improvement plan for the construction or expansion of a convention center facility.

(D) Eligible tax proceeds--Local ad valorem taxes, local sales and use taxes, local hotel occupancy taxes, local mixed beverage gross receipts taxes, and local mixed beverage sales taxes that are generated, paid, or collected by a qualified hotel project or facilities ancillary to the hotel, and that may be rebated, refunded, or paid to the owner of a qualified hotel project under an agreement with a municipality, county, or other governmental body.

(E) Facility ancillary to the hotel--A facility owned by or located on land owned by a municipality or, for an eligible central municipality, a nonprofit corporation acting on its behalf that provides necessary support for the operation and function of the hotel, and that is:

(i) located within 1,000 feet of a convention center facility owned by the municipality or hotel, as measured from the closest exterior wall of the ancillary facility in a single-tenant building or closest demising wall of the ancillary facility in a multi-tenant building to the closest exterior wall of the convention center facility or hotel; and

(ii) located in a hotel project owned by or located on land owned by:

(I) an eligible central municipality or a nonprofit organization acting on behalf of an eligible central municipality;

(II) a municipality with a population of 173,000 or more that is located within two or more counties, including a hotel project not owned by or located on land owned by the municipality if the project is located on land that is owned by the federal government;

(III) a municipality with a population of 96,000 or more that is located in a county that borders Lake Palestine;

(IV) a municipality with a population of 96,000 or more that contains the headwaters of the San Gabriel River;

(V) a municipality with a population of at least 99,900 but not more than 111,000 that is located in a county with a population of at least 135,000;

(VI) a municipality with a population of at least 110,000 but not more than 135,000 at least part of which is located in a county with a population of not more than 135,000;

(VII) a municipality with a population of at least 9,000 but not more than 10,000 that is located in two counties, each of which has a population of at least 662,000 and a southern border with a county with a population of 2.3 million or more;

(VIII) a municipality with a population of at least 200,000 but not more than 300,000 that contains a component institution of the Texas Tech University System;

(IX) a municipality with a population of at least 95,000 that borders Lake Lewisville;

(X) a municipality that:

(-a-) contains a portion of Cedar Hill State Park;

(-b-) has a population of more than 45,000;

(-c-) is located in two counties, one of which has a population of more than two million and one of which has a population of more than 149,000; and

(-d-) has adopted a capital improvement plan for the construction or expansion of a convention center facility;

(XI) a municipality with a population of less than 6,000 that:

(-a-) is located in two counties each with a population of 600,000 or more that are both adjacent to a county with a population of two million or more;

(-b-) has full-time police and fire departments; and

(-c-) has adopted a capital improvement plan for the construction or expansion of a convention center facility;

(XII) a municipality with a population of at least 56,000 that:

(-a-) borders Lake Ray Hubbard; and

(-b-) is located in two counties, one of which has a population of less than 80,000;

(XIII) a municipality with a population of more than 83,000, that borders Clear Lake, and that is primarily located in a county with a population of less than 300,000;

(XIV) a municipality with a population of less than 2,000 that:

(-a-) is located adjacent to a bay connected to the Gulf of Mexico;

(-b-) is located in a county with a population of 290,000 or more that is adjacent to a county with a population of four million or more; and

(-c-) has a boardwalk on the bay;

(XV) a municipality with a population of 75,000 or more that:

(-a-) is located wholly in one county with a population of 575,000 or more that is adjacent to a county with a population of four million or more; and

(-b-) has adopted a capital improvement plan for the construction or expansion of a convention center facility;

(XVI) a municipality with a population of less than 75,000 that is located in three counties, at least one of which has a population of at least four million; or

(XVII) a home-rule municipality that borders the Gulf of Mexico with a population of more than 3,000 but less than 5,000.

(iii) The term includes convention center entertainment-related facilities, meeting spaces, restaurants, shops, street and water and sewer infrastructure necessary for the operation of the hotel or ancillary facilities, and parking facilities.

(I) Surface parking lot facilities must be located within 1,000 feet of the convention center facility or hotel, as measured from the closest marked parking space of a surface parking lot facility to the closest exterior wall of the convention center facility or hotel. Surface parking lot facilities intersected by a public road or thoroughfare are considered separate parking facilities. Only a parking lot facility that contains a marked parking space within 1,000 feet of the convention center facility or hotel will be eligible for rebates.

(II) The term includes facilities ancillary to a hotel that are part of the hotel project but that may be completed in different phases of the hotel project as evidenced by documentation listed in paragraph (2) of this subsection. The term does not include existing facilities located within 1,000 feet of the hotel or convention center facility that were not constructed, developed, or remodeled as part of the hotel project.

(F) Governmental body--A local governmental body with the authority to impose taxes.

(G) Hotel and Convention Center Project--A project that is an existing hotel owned by the municipality or another person and a convention center facility to be acquired, constructed, equipped, or leased, that will be located within 1,000 feet of the hotel, and that will be owned by or located on land owned by the municipality. This subparagraph applies only to a municipality that:

(i) is the county seat of a county that:

(I) borders the United Mexican States;

(II) has a population of less than 300,000; and

(III) contains one or more municipalities with a population of 200,000 or more; and

(ii) holds an annual jalapeño festival.

(H) Hotel Project--A hotel that is owned by or located on land owned by a municipality or, for an eligible central municipality, a nonprofit corporation acting on its behalf, and located within 1,000 feet of a convention center facility owned by the municipality, as measured by the closest exterior wall of the hotel and the closest exterior wall of the convention center facility. The parking lot is not part of a convention center facility for the purpose of measuring the 1,000-foot distance requirement. The term includes a facility ancillary to the hotel as defined in subparagraph (E) of this paragraph.

(I) Open for initial occupancy--The earliest date on which a member of the public obtains sleeping accommodations for consideration and the convention center is operational, as supported by records of the hotel and convention center.

(J) Shop--A retail store that exclusively sells tangible personal property.

(K) Tangible personal property--Personal property that can be seen, weighed, measured, felt, or touched or that is perceptible to the senses in any other manner, and includes a computer program and a telephone prepaid calling card.

(2) Requirements to initiate a request for rebate, refund, or payment of taxes for a hotel project.

(A) A municipality identified in paragraph (1)(E)(ii) and (G) of this subsection seeking a refund from the comptroller of state sales and use taxes, state hotel occupancy taxes, and eligible tax proceeds must submit a written request to the comptroller's Audit Division along with the following information, as applicable:

(i) a copy of the certificate of formation for the nonprofit corporation acting on behalf of an eligible central municipality;

(ii) a copy of the municipality's capital improvement plan;

(iii) a copy of the municipality's ordinance or resolution approving the rebate agreement between the municipality or nonprofit corporation acting on behalf of an eligible central municipality, and the hotel project;

(iv) a copy of the architect's plan for the hotel project;

(v) a map that shows the required distances between the hotel project, including facilities ancillary to the hotel, and the convention center facility;

(vi) records from the hotel, convention center, and municipality, such as guest folios and press releases, which show the date when the project was open for initial occupancy;

(vii) the name and address of the hotel and the comptroller-issued taxpayer identification and location numbers that the hotel is using, or will use, to report sales and use tax, hotel occupancy tax, mixed beverage gross receipts tax, and mixed beverage sales tax;

(viii) the name and comptroller-issued taxpayer identification and location numbers of each facility ancillary to the hotel;

(ix) waiver of confidentiality releases signed by the authorized officer or director of the hotel and each facility ancillary to the hotel allowing the comptroller to release the facility's sales and use tax and mixed beverage sales tax information to the municipality or the nonprofit corporation acting on behalf of an eligible central municipality. A waiver of confidentiality release must be renewed annually, unless it specifically states a longer period not to exceed three years;

(x) the name and telephone numbers of the contact person for the municipality or the nonprofit corporation acting on behalf of an eligible central municipality; and

(xi) a completed direct deposit authorization form from the municipality or the nonprofit corporation acting on behalf of an eligible central municipality.

(B) The comptroller will give the requestor written notice of the results of the request for rebate, refund, or payment of taxes for a hotel project.

(3) Tax rebates for hotel projects.

(A) A municipality described in paragraph (1)(E)(ii) of this subsection is entitled to receive from a hotel project 100% of the state sales and use tax and state hotel occupancy tax paid or collected by the hotel project, and eligible tax proceeds, during the first 10 years after the hotel project is open for initial occupancy. The tax rebate period ends on the tenth anniversary of the date the hotel project opened for initial occupancy.

(B) Pursuant to Government Code, § 2303.5055 (Refund, Rebate, or Payment of Tax Proceeds to Qualified Hotel Project), the comptroller can only rebate eligible tax proceeds that a governmental body has agreed to rebate. The agreement must be in writing and specify that the comptroller rebate the eligible tax proceeds directly to the municipality.

(C) A municipality described in paragraph (1)(E)(ii)(VI-XVII) of this subsection is not entitled to receive funds from a hotel project unless the municipality has pledged the revenue derived from the hotel occupancy paid or collected from the hotel project for the payment of bonds or other obligations issued or incurred for the hotel project.

(D) A municipality may not receive or pledge revenue or funds for a hotel project or hotel and convention center project unless the municipality enters into an agreement with a person for the development of the hotel project before September 1, 2019.

(E) A municipality described in paragraph (1)(G) of this subsection is entitled to receive from a hotel and convention center project 100% of the state sales and use tax and state hotel occupancy tax paid or collected by the hotel project, and eligible tax proceeds, during the first 10 years after the hotel project is open for initial occupancy. The tax rebate period ends on the tenth anniversary of the date the hotel project opened for initial occupancy.

(4) Multiple hotel projects.

(A) A municipality described in paragraph (1)(E)(ii) of this subsection may designate more than one hotel project.

(B) After a facility ancillary to the hotel has entered into a tax rebate agreement with a hotel project, the facility cannot associate with another hotel project to extend the 10-year tax rebate period in paragraph (3)(A) of this subsection.

(b) Project financing zones.

(1) Definitions. The following words and terms, when used in this subsection, shall have the following meanings, unless the context clearly indicates otherwise.

(A) Base year amount--The amount of hotel-associated revenue collected in a project financing zone during the calendar year that includes the zone's date of designation.

(B) Commenced--The date a contract to acquire, lease, construct, improve, enlarge, or equip a qualified project is executed.

(C) Convention center facilities--Facilities that are primarily used to host conventions and meetings. The term means civic centers, civic center buildings, auditoriums, exhibition halls, and coliseums that are owned by the municipality or other governmental entity or that are managed in whole or part by the municipality. The term includes:

(i) parking areas or facilities that are for the parking or storage of conveyances and that are located at or in the vicinity of other convention center facilities; and

(ii) a hotel owned by or located on land owned by an eligible central municipality or a nonprofit organization acting on behalf of an eligible central municipality and that is located within 1,000 feet of a convention center facility owned by the municipality.

(D) Date of designation--The date a municipality by ordinance or agreement under Local Government Code, Chapter 380 (Miscellaneous Provisions Relating to Municipal Planning and Development) designates a project financing zone.

(E) Hotel-associated revenue--The amount of tax revenue that is the sum of the following:

(i) state sales and use taxes and state hotel occupancy taxes collected from all hotels located in a project financing zone, excluding the state tax revenue received from a qualified hotel project that exists on the zone's date of designation; and

(ii) the mixed beverage gross receipts tax and mixed beverage sales tax revenue collected from all mixed beverage permittees at hotels located in the project financing zone, excluding the local mixed beverage taxes disbursed to the municipality under Tax Code, § 183.051 (Mixed Beverage Tax Clearance Fund).

(F) Incremental hotel-associated revenue--The amount of hotel-associated revenue received in any calendar year from hotels located within a project financing zone, including hotel-associated revenue from hotels built in the project financing zone after the year in which a municipality designates the zone, that exceeds the base year amount. After the hotel project's 10-year state tax rebate period expires, the hotel-associated revenue received from a hotel located in a hotel project that existed on the zone's date of designation is included in incremental hotel-associated revenue, but not included in the base year amount.

(G) Project financing zone--An area within a municipality:

(i) that the municipality by ordinance or by agreement under Local Government Code, Chapter 380, designates as a project financing zone;

(ii) the boundaries of which are within a three-mile radius of the center of a qualified project;

(iii) the designation of which specifies the longitude and latitude of the center of the qualified project; and

(iv) the designation of which expires not later than the 30th anniversary of the date of designation.

(H) Qualified project--

(i) A convention center facility; or

(ii) a multipurpose arena or venue that includes a livestock facility and is located within or adjacent to a recognized cultural district, and any related infrastructure, that is:

(I) located on land owned by a municipality or by the owner of the venue;

(II) partially financed by private contributions that equal not less than 40% of the project costs; and

(III) related to the promotion of tourism and the convention and hotel industry.

(I) Related infrastructure--The term includes any store, restaurant, on-site hotel, concession, automobile parking facility, area transportation facility, road, street, water or sewer facility, park, or other on-site or off-site improvement that relates to and enhances the use, value, or appeal of a venue, including areas adjacent to the venue, and any other expenditure reasonably necessary to construct, improve, renovate, or expand a venue, including an expenditure for environmental remediation.

(J) Venue--

(i) an arena, coliseum, stadium, or other type of area or facility:

(I) that is used or is planned for use for one or more professional or amateur sports events, community events, or other sports events, including rodeos, livestock shows, agricultural expositions, promotional events, and other civic or charitable events; and

(II) for which a fee for admission to the events is charged or is planned to be charged;

(ii) a convention center, convention center facility, or related improvement, such as a civic center hotel, theater, opera house, music hall, rehearsal hall, park, zoological park, museum, aquarium, or plaza, located in the vicinity of a convention center or convention center facility owned by a municipality or a county;

(iii) a tourist development area along an inland waterway;

(iv) a municipal parks and recreation system, or improvements or additions to a parks and recreation system, or an area or facility that is part of a municipal parks and recreation system;

(v) a project authorized by Section 4A or 4B, Development Corporation Act of 1979 (Article 5190.6, Vernon's Texas Civil Statutes), as that Act existed on September 1, 1997; and

(vi) a watershed protection and preservation project; a recharge, recharge area, or recharge feature protection project; a conservation easement; or an open-space preservation program intended to protect water.

(2) Requirements to initiate a request for rebate, refund, or payment of taxes for a qualified project located in a project financing zone.

(A) The municipality must submit a written request to the comptroller's Audit Division along with the following information, as applicable:

(i) a copy of the approval from the municipality of the project financing zone's designation;

(ii) documentation showing that the qualified project has commenced;

(iii) a map that shows the boundaries of the project financing zone and identifies all active hotels located within those boundaries;

(iv) the name and address of each hotel located within the project financing zone along with the comptroller-issued taxpayer identification and location numbers that each hotel is using to report sales and use tax, hotel occupancy tax, mixed beverage gross receipts tax, and mixed beverage sales tax;

(v) the names and comptroller-issued taxpayer identification and location numbers for all shops, parking facilities, and other facilities that are located in hotels within a project financing zone;

(vi) when there are fewer than four taxpayers with active sales and use tax permits or mixed beverage permits operating within a project financing zone, a waiver of confidentiality release signed by the authorized officer or director from each sales and use tax permittee and mixed beverage tax permittee located at a hotel in the project financing zone allowing the comptroller to release the sales and use tax and mixed beverage sales tax information to the municipality. A waiver of confidentiality release must be renewed annually, unless it specifically states a longer period not to exceed three years;

(vii) the name and telephone numbers of the contact person with the municipality; and

(viii) a completed direct deposit authorization form from the municipality.

(B) If a municipality designates one project financing zone in which multiple qualified projects are located, the comptroller will consider the boundaries of the project-financing zone to be a distance of a three-mile radius from the center of each of the qualified projects.

(i) The hotel-associated revenue collected from all hotels located in the project financing zone shall be included in the zone's incremental hotel-associated revenue.

(ii) Payments to the municipality under clause (i) of this subparagraph will begin on the date the municipality notifies the comptroller in writing that the first qualified project has commenced.

(C) The comptroller will give the requestor written notice of the results of the request to initiate rebate, refund, or payment of taxes for a qualified project in a project financing zone.

(3) Tax rebates for qualified projects located in project financing zones.

(A) A municipality with a population of at least 650,000 but less than 750,000, according to the most recent federal decennial census, or a municipality with a population of 1,180,000 or more that is located predominantly in a county that has a total area of less than 1,000 square miles and that has adopted a council-manager form of government, may pledge incremental hotel-associated revenue received from hotels located in a project financing zone for the payment of bonds and obligations issued to acquire, lease, construct, improve, enlarge, and equip a qualified project.

(B) The municipality may designate a project financing zone. The municipality must notify the comptroller of the designation of the project financing zone not later than the 30 days after the date the municipality designates the project financing zone.

(i) The boundaries of a project financing zone must be within a three-mile radius of the center of a qualified project and must be within the corporate limits of the municipality.

(ii) The designation of the project financing zone must include the longitude and latitude of the center of the qualified project.

(C) The municipality is entitled to receive the incremental hotel-associated revenue from hotels located in the project financing zone beginning the first day of the year after the year of the zone's date of designation.

(i) Payments of the incremental hotel-associated revenue end on the last day of the month during which the designation of a project financing zone expires.

(ii) The designation of a project financing zone expires not later than 30 years from the anniversary month in which the zone was designated.

(D) Beginning the first day of the year after the year of the zone's date of designation, the comptroller shall deposit incremental hotel-associated revenue collected or received in a separate trust account.

(i) Payments from the trust account to the municipality begin on the date a qualified project has commenced and the municipality has provided the comptroller with the documentation required under paragraph (2) of this subsection.

(ii) If the qualified project has not commenced by the fifth anniversary of the first deposit to the account, the comptroller shall stop making deposits and transfer the money in the account to the general revenue fund.

(iii) The comptroller may estimate the amount of incremental hotel-associated revenue that will be deposited for the calendar year and deposit that amount to the trust account. The calculation of the estimated incremental hotel-associated revenue is based on the base year amount, less the previous year revenue amount for year one revenue estimates. The next year's incremental difference is based on the revenue from the previous year and the base year. The municipality may request disbursements on a monthly basis based on the estimate. The comptroller must adjust deposits and disbursements to reflect the amount of revenue actually deposited at the end of each calendar year.

(iv) A municipality must notify the comptroller if a qualified project is abandoned. The comptroller shall transfer to the general revenue fund the amount of money in the trust account that exceeds the amount needed for payment of bonds or other obligations issued or incurred under subparagraphs (A) and (C) of this paragraph.

(c) Qualified hotel projects.

(1) Definitions. The following words and terms, when used in this subsection, shall have the following meanings, unless the context clearly indicates otherwise.

(A) Convention center facilities--Facilities that are primarily used to host conventions and meetings. The term means civic centers, civic center buildings, auditoriums, exhibition halls, and coliseums that are owned by the municipality or other governmental entity or that are managed in whole or part by the municipality. The term includes parking areas or facilities that are for the parking or storage of conveyances and that are located at or in the vicinity of other convention center facilities.

(B) Eligible tax proceeds--Local ad valorem taxes, local sales and use taxes, local hotel occupancy taxes, local mixed beverage gross receipts taxes, and local mixed beverage sales taxes that are generated, paid, or collected by a qualified hotel project, or facilities ancillary to the hotel, and that may be rebated, refunded, or paid to the owner of a qualified hotel project under an agreement with a municipality, county, or other governmental entity.

(C) Facility ancillary to the hotel--A facility located within 1,000 feet of a convention center facility owned by a municipality, as measured from the closest exterior wall of the ancillary facility in a single-tenant building or closest demising wall of the ancillary facility in a multi-tenant building to the closest exterior wall of the convention center facility, that is located in a qualified hotel project, and which provides necessary support for the operation and function of the hotel. Surface parking lot facilities must be located within 1,000 feet of the convention center facility, as measured from the closest marked parking space of a surface parking lot facility to the closest exterior wall of the convention center facility. Surface parking lot facilities intersected by a public road or thoroughfare are considered separate parking facilities. Only a parking lot facility that contains a marked parking space within 1,000 feet of the convention center facility will be eligible for rebates. The term includes facilities ancillary to a hotel that are part of the hotel project but that may be completed in different phases of the hotel project as evidenced by documentation listed in paragraph (2) of this subsection. The term does not include existing facilities located within 1,000 feet of the convention center facility that were not constructed, developed, or remodeled as part of the qualified hotel project.

(D) Governmental body--A local governmental body with the authority to impose taxes.

(E) Nonprofit municipally sponsored local government corporation--A corporation created under the Texas Transportation Corporation Act, Transportation Code, Chapter 431 (Texas Transportation Corporation Act). This definition also applies to the term "municipally sponsored local government corporation."

(F) Open for initial occupancy--The earliest date on which a member of the public obtains sleeping accommodations for consideration and the convention center is operational, as supported by records of the hotel and convention center.

(G) Qualified hotel project--A hotel proposed to be constructed, or being constructed, by a municipality or nonprofit municipally sponsored local government corporation, including a privately owned or existing hotel selected by a municipality, that is located within 1,000 feet of a convention center owned by a municipality having a population of 1,500,000 or more, including shops, parking facilities, and any other facilities ancillary to the hotel. The parking lot is not part of a convention center facility for the purpose of measuring the 1,000-foot distance requirement.

(2) Requirements to initiate a request for rebate, refund, or payment of taxes for a qualified hotel project.

(A) The owner of a qualified hotel project seeking a refund from the comptroller of state sales and use taxes, state hotel occupancy taxes, and eligible tax proceeds must submit a written request to the comptroller's Audit Division along with the following information, as applicable:

(i) a copy of the certificate of formation for the nonprofit municipally sponsored local government corporation;

(ii) a copy of the municipality's ordinance approving the rebate agreement between the municipality or nonprofit municipally sponsored local government corporation and the qualified hotel project;

(iii) a copy of the architect's plan for the qualified hotel project;

(iv) a map that shows the required distances between the qualified hotel project, including facilities ancillary to the hotel, and the convention center facility;

(v) records from the hotel, convention center, and municipality, such as guest folios and press releases, which show the date when the qualified hotel project was open for initial occupancy;

(vi) the name and address of the hotel and the comptroller-issued taxpayer identification and location numbers that the hotel is using, or will use, to report sales and use tax, hotel occupancy tax, mixed beverage gross receipts tax, and mixed beverage sales tax;

(vii) the name and comptroller-issued taxpayer identification and location numbers of each facility ancillary to the hotel;

(viii) waiver of confidentiality releases signed by the authorized officer or director of the hotel and each facility ancillary to the hotel allowing the comptroller to release the facility's sales and use tax and mixed beverage sales tax information to the owner of the qualified hotel project, the municipality, or the nonprofit municipally sponsored local government corporation. A waiver of confidentiality release must be renewed annually, unless it specifically states a longer period not to exceed three years;

(ix) the name and telephone numbers of the contact person for the qualified hotel project, the municipality, or the nonprofit municipally sponsored local government corporation; and

(x) a completed direct deposit authorization form from the owner of the qualified hotel project, the municipality, or the nonprofit municipally sponsored local government corporation.

(B) The comptroller will give the requestor written notice of the results of the request to initiate rebate, refund, or payment of taxes for a qualified hotel project.

(3) Tax rebates for qualified hotel projects.

(A) The owner of a qualified hotel project is entitled to receive 100% of the state sales and use tax and state hotel occupancy tax paid or collected by the qualified hotel project, and eligible tax proceeds, during the first 10 years after the qualified hotel project is open for initial occupancy. The tax rebate period ends on the tenth anniversary of the date the hotel project opened for initial occupancy. The comptroller does not have the authority to issue tax rebates until the project is open for initial occupancy.

(B) Pursuant to Government Code, § 2303.5055, the comptroller can only rebate eligible tax proceeds that a governmental body has agreed to rebate. The agreement must be in writing and specify that the comptroller rebate the eligible tax proceeds to the owner of the qualified hotel project.

(C) Multiple qualified hotel projects.

(i) A municipality described in paragraph (1)(G) of this subsection may designate more than one qualified hotel project.

(ii) After a facility ancillary to the hotel has entered into a tax rebate agreement with a qualified hotel project, the ancillary facility cannot associate with another qualified hotel project to extend the 10-year tax rebate period in subparagraph (A) of this paragraph.

Notes

34 Tex. Admin. Code § 3.12

Adopted by Texas Register, Volume 44, Number 10, March 8, 2019, TexReg 1346, eff. 3/12/2019