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Bill

HB 4109

Relating to the authority of certain municipalities to receive certain tax revenue derived from a hotel and convention center project and to pledge certain tax revenue for the payment of obligations related to the project.

89th Legislature (2025) Introduced by Daniel Alders

Authorizes select Texas municipalities to dedicate hotel tax revenue to finance hotel and convention center projects and repay related debt obligations.

Left pending in committee
#taxation--hotel #moteloccupancy(i0806)
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Bill Summary · HB 4109

Legislative bill overview

HB 4109 authorizes certain Texas municipalities to capture and dedicate tax revenue generated from hotel and convention center projects to repay bonds and obligations related to those projects. The bill essentially allows cities to pledge hotel-related tax income (likely hotel occupancy taxes) as a revenue stream specifically for financing and servicing debt on convention center infrastructure.

Why is this important

Hotel tax revenue is a significant municipal funding source, and this bill would allow cities to earmark these proceeds for specific capital projects rather than general budgets. This mechanism can enable municipalities to finance convention center expansion or improvement without raising taxes or using general fund dollars, but it also reduces the flexibility of tax revenue that might otherwise support other city services.

Potential points of contention

  • Revenue dedication concerns: Committing hotel tax revenue to specific projects reduces municipal flexibility and could limit funding for other city services, education, or emergency needs if convention center projects underperform financially
  • Which municipalities qualify: The bill's reference to "certain municipalities" suggests selective applicability, raising questions about fairness and which cities benefit from this authority
  • Project financial risk: If a hotel/convention center project generates insufficient revenue to cover debt obligations, municipalities may need to backfill shortfalls from general funds, transferring financial risk to taxpayers

Compiled from official sources — confirm details with the bill’s official record.

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