City of Water Valley; authorize to enact a tax on restaurants for tourism and parks and recreation.

2025 Regular Session Introduced by Ben Suber

Water Valley is authorized to adopt a local restaurant tax to fund tourism promotion and parks and recreation; details like rate and exemptions are set by local ordinance.

Approved by Governor

#finance #localandprivate #localandprivatelegislation

Purpose

SB 3265 authorizes the City of Water Valley to enact a municipal tax on restaurants (a local prepared food/restaurant tax) specifically to generate revenue for tourism promotion and parks and recreation services and projects. The measure is local/private in scope and applies only to the City of Water Valley.

Key provisions

Grants the City of Water Valley explicit statutory authority to adopt a tax on restaurants/food service sales.

Designates allowable uses of revenue raised by the tax: tourism-related activities and parks and recreation programs, maintenance, capital improvements, or operations.

Leaves implementing details (tax rate, exemptions, collection procedures, effective date, duration/renewal, administrative responsibilities, enforcement, and use restrictions) to be established by local ordinance consistent with state law. (The enrolled bill text is not provided here, so specific rate caps or exemptions — if any — are not stated.)

The authorization is local and does not create a statewide tax; it permits the city government to propose, enact, and administer the local tax.

Who is affected

Restaurants, cafes, and other food-service businesses in the City of Water Valley: they would collect and remit the tax on qualifying sales and bear associated administrative compliance costs.

Patrons/customers of restaurants in Water Valley: may pay higher prices due to the added tax.

City of Water Valley government and local tourism/parks entities: potential new source of dedicated funding for tourism promotion and parks & recreation services.

Broader local economy: potential effects on business competitiveness and visitor spending depending on the tax rate and use of funds.

Fiscal and policy impacts

Expected to generate additional local revenue earmarked for tourism and parks & recreation. The magnitude depends on the tax rate and local restaurant sales volume.

Could impose administrative and compliance costs on businesses and the city.

Potential to enhance tourism marketing, facility maintenance, and recreational programming if funds are effectively deployed.

Legislative and procedural timeline

Introduced: March 6, 2025 (referred to Local and Private; Finance committees).

Passed legislature: March 26 – April 1, 2025 (various committee actions, title sufficiency “Do Pass,” transmitted to House, enrolled).

Enrolled bill signed and returned: April 7, 2025.

Approved by Governor: April 10, 2025 — SB 3265 is enacted as law. (The bill’s effective date or any implementation deadlines are not specified here; those would be contained in the enrolled bill text or follow existing state effective-date rules.)

Notes: This summary is based on bill metadata and legislative actions. For precise statutory language, authorized tax rates/caps, exemptions, administrative procedures, or sunset provisions, consult the enrolled bill text as enacted by the Legislature and signed by the Governor.

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