Senate Bill No. 618
(By Senators Walker and Kimble)
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[Introduced February 19, 1998; referred to the
Committee on Government Organization; and then to the Committee
on Finance.]
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A BILL to amend and reenact sections two, nine and fourteen,
article eighteen, chapter seven of the code of West
Virginia, one thousand nine hundred thirty-one, as amended,
all relating to the hotel occupancy tax and the expenditure
of revenues collected therefrom; providing municipalities
the power to increase rate of the tax to an amount up to six
percent; requiring that a minimum percentage of the revenue
collected from the tax be expended for the promotion of
conventions and tourism; providing that balance of revenues
collected from the tax may be expended on the establishment,
planning, construction and improvement of arenas,
auditoriums, civic centers, convention facilities and
facilities for the promotion of arts and sciences; permitting the financing of such facilities and projects
from proceeds of revenue bonds; providing that hotel
occupancy tax revenues may be used to repay the bonds;
permitting contributions by a municipality of all or a
portion of such balance to promote arts and science;
permitting the dedication by a municipality of not to exceed
five million dollars in the aggregate of such balance over
a period of not to exceed ten years to promote arts and
sciences; and permitting the pledge by a municipality of all
or portion of such balance to secure the payment of debt
service in connection with any financing obtained for
contributions to promote arts and sciences or for facilities
and projects financed from proceeds of revenue bonds.
Be it enacted by the Legislature of West Virginia:
That sections two, nine and fourteen, article eighteen,
chapter seven of the code of West Virginia, one thousand nine
hundred thirty-one, as amended, be amended and reenacted, to read
as follows:
ARTICLE 18. HOTEL OCCUPANCY TAX.
§7-18-2. Rate of tax.
(a)The rate of tax imposed shall be three percent of the
consideration paid for the use or occupancy of a hotel room.
Such consideration shall not include the amount of tax imposed on the transaction under article fifteen, chapter eleven of this
code, or charges for meals, valet service, room service,
telephone service or other charges or consideration not paid for
use or occupancy of a hotel room.
(b) On and after the first day of July, one thousand nine
hundred ninety seven, a municipality may, upon enactment of an
ordinance in accordance with the provisions of article eleven,
chapter eight of this code, increase the rate of tax under this
article up to an amount not to exceed six percent of the
consideration paid for the use or occupancy of a hotel room. The
consideration may not include the amount of tax imposed on the
transaction under article fifteen, chapter eleven of this code,
or charges for meals, valet service, room service, telephone
service or other charges or consideration not paid for use or
occupancy of a hotel room.
§7-18-9. Total amount collected to be remitted.
No profit shall may accrue to any person as a result of the
collection of the tax authorized under this article.
Notwithstanding that the total amount of such the taxes collected
by a hotel operator may be in excess of the amount for which a
consumer would be liable by the application of the levy of three
percent for the occupancy of a hotel room or rooms, or in the
case of a municipality that imposes and levies up to an additional three percent for the occupancy of a hotel room or
rooms under this article, by the application of such additional
percentage the total amount of all taxes collected by any hotel
operator shall be remitted to the taxing authority as hereinafter
provided.
§7-18-14. Proceeds of tax; application of proceeds.
(a)Application of proceeds. -- The net proceeds of the tax
collected and remitted to the taxing authority pursuant to this
article shall be deposited into the general revenue fund of such
municipality or county commission and, after appropriation
thereof, shall be expended only as provided in subsections (b)
and (c) of this section: Provided, That any portion of the tax
collections may be deposited into a special revenue fund as the
municipality or county commission may direct.
(b)Required expenditures. -- At least fifty percent of
From the net revenue receivable during the fiscal year by a
county or a municipality pursuant to this article, a county or
municipality shall expend at least fifty percent of the revenue
calculated on the basis of a maximum rate of tax equal to three
percent shall be expended in the following manner set forth in
subdivisions (1) and (2) of this section for the promotion of
conventions and tourism;
(1)Municipalities. -- If a convention and visitor's bureau is located within the municipality, county or region, the
governing body of such the municipality shall appropriate the
percentage required by this subsection to that bureau. If a
convention and visitor's bureau is not located within such the
municipality, county or region, then the percentage appropriation
required by this subsection shall be appropriated as follows:
(i)Any hotel within such the municipality, county or
region may apply to
such the
municipality for an appropriation to
such hotel of a portion of the tax authorized by this article and
collected by
such the
hotel and remitted to
such the
municipality, for uses directly related to the promotion of
tourism and travel, including advertisement, salaries, travel,
office expenses, publications and similar expenses. The portion
of
such the
tax allocable to
such the
hotel shall may not exceed
seventy-five percent of that portion of
such the
tax collected
and remitted by
such the
hotel which is required to be expended
pursuant to this subsection: Provided, That prior to
appropriating any moneys to
such the
hotel
such the
municipality
shall require the submission of, and give approval to, a budget
setting forth the proposed uses of
such the
moneys.
(ii)If there is more than one convention and visitor's
bureau located within a municipality, county or region, the city
council may allocate the tax authorized by this article to one or more of
such the
bureaus in such portion as the city council in
its sole discretion determines.
(iii) The balance of the revenue required to be expended by
this subsection shall be appropriated to the regional travel
council serving the area in which the municipality is located.
(2)Counties. -- If a convention and visitor's bureau is
located within a county or region, the county commission shall
appropriate the percentage required by this subsection to that
convention and visitor's bureau. If a convention and visitor's
bureau is not located within such county or region, then the
percentage appropriation required by this subsection shall be
appropriated as follows:
(i)Any hotel located within
such the
county or region may
apply to
such the
county for an appropriation to
such the
hotel
of a portion of the tax authorized by this article and collected
by
such the
hotel and remitted to
such the
county, for uses
directly related to the promotion of tourism and travel,
including advertising, salaries, travel, office expenses,
publications and similar expenses. The portion of
such the
tax
allocable to
such the
hotel shall not exceed seventy-five percent
of that portion of
such the
tax collected and remitted by
such
the
hotel which is required to be expended pursuant to this
subsection: Provided, That prior to appropriating any moneys to
such the
hotel
such the
county shall require the submission of,
and give approval to, a budget setting forth the proposed uses of
such the
moneys.
(ii)If there is more than one convention and visitor's
bureau located within a county or region, the county commission
may allocate the tax authorized by this article to one or more of
such the
bureaus in such portion as the county commission in its
sole discretion determines.
(iii) The balance of net revenue required to be expended by
this subsection shall be appropriated to the regional travel
council serving the area in which the county is located.
(3)Legislative findings. -- The Legislature finds and
declares that in order to attract new business and industry to
this state and to retain existing business and industry all to
provide the citizens of the state with economic security, to
provide educational opportunities for the citizens of the state
in the arts and sciences and to advance the business prosperity
and economic welfare of this state, it is necessary to: (1)
Enhance recreational and tourism opportunities, and (2) promote
the arts and sciences. Therefore, in order to promote
recreation, tourism, arts and sciences, the Legislature finds
that public financial support should be provided for
constructing, equipping, improving and maintaining projects, agencies and facilities which promote recreation, tourism, arts
and sciences. The Legislature hereby further finds that the
support of convention and visitor's bureaus, hotels and regional
travel councils is a public purpose for which funds may be
expended. Local convention and visitor's bureaus, hotels and
regional travel councils receiving funds under this subsection
may expend such funds for the payment of administrative expenses,
and for the direct or indirect promotion of conventions and
tourism, and for any other uses and purposes authorized by
subdivisions (1) and (2) of this subsection.
(c) Permissible expenditures. -- After making the
appropriation required by subsection (b) of this section, the
remaining portion of the net revenues receivable during the
fiscal year by such county or municipality, pursuant to this
article, may be expended by the county or municipality, or
transferred to any other public body or agency of the state or
other person and expended by the body, agency or person, for one
or more of the purposes set forth in this subsection, but for no
other purpose. The purpose for which expenditures may be made
pursuant to this subsection are as follows:
(1) The planning, construction, reconstruction,
establishment, acquisition, improvement, renovation, extension,
enlargement, equipment, maintenance, repair and operation of publicly owned convention facilities, including, but not limited
to, arenas, auditoriums, civic centers and convention centers;
(2) The planning, construction, reconstruction,
establishment, acquisition, improvement, renovation, extension,
enlargement, equipment, maintenance, repair and operation of
publicly owned or held facilities established for the promotion
of the arts and sciences, including, but not limited to,
performing arts centers or theaters, science centers,
planetariums, art museums and film theaters;
(2) (3) The payment of principal or interest or both on
revenue bonds issued to finance such convention facilities any
expenditure for authorized purposes for any of the projects
described in subdivisions (1) and (2) of this subsection;
(4) Contributions by a county or municipality to promote
projects described in subdivision (2) of this subsection,
including, but not limited to, the pledge by a county or
municipality of all or a portion of net revenues receivable
during the fiscal year or receivable in any succeeding fiscal
year, pursuant to this article, for contributions to promote
these projects or for the payment of debt service in connection
with any financing obtained for that purpose;
(3) (5) The promotion of conventions;
(4) (6) The construction, operation or maintenance of public parks, tourist information centers and recreation facilities
(including land acquisition);
(5) (7) The promotion of the arts;
(6) (8) Historic sites;
(7) (9) Beautification projects; or
(8) (10) Medical care, in an amount not exceeding one
hundred thousand dollars, in any county where: (i) There is an
urgent necessity to preserve the delivery of acute medical care
services; (ii) there is an increase in need for delivery of acute
medical care services related to tourism; (iii) recurrent
flooding in the county significantly disrupts, on a periodic
basis, the delivery of acute medical care services; (iv) there is
an inadequate economic base within the county from any source
other than tourism to preserve the delivery of acute medical care
services; (v) there is an inadequate economic base directly
related to low population in the county, specifically, a
population of less than ten thousand persons according to the
census of the year one thousand nine hundred ninety; and (vi)
there is one and only one hospital within the county; and the
county commission makes specific findings, by resolution, that
all of the foregoing conditions within the county exist.
Notwithstanding anything in this subsection to the contrary,
all revenues received by a municipality from the rate of tax imposed pursuant to this article which are in excess of three
percent may only be used for one or more of the purposes set
forth in subdivisions (1) through (4), of this subsection:
Provided, That any municipality which lacks or determines it has
no need for the type of facilities described in subdivisions (1)
through (4), of this subsection, may use the revenues for the
purposes described in subdivisions (5) through (10) of this
subsection.
(d) Pledge of net revenues by municipality. -- A county or
municipality may, after making the appropriation required by
subsection (b) of this section, pledge all or a portion of net
revenues receivable during the fiscal year or receivable in any
succeeding fiscal year, pursuant to this article, as security for
the payment of principal or interest or both in connection with
any financing obtained for any expenditure authorized under
subdivisions (3) and (4) of subsection (c) of this section.
(d) (e) Definitions. -- For purposes of this section, the
following terms are defined:
(1)Convention and visitor's bureau and visitor's and
convention bureau. -- "Convention and visitor's bureau" and
"visitor's and convention bureau" are interchangeable and either
shall mean means a nonstock, nonprofit corporation with a
full-time staff working exclusively to promote tourism and to attract conventions, conferences and visitors to the
municipality, county or region in which such
the
convention and
visitor's bureau or visitor's and convention bureau is located or
engaged in business within.
(2)Convention center. -- "Convention center" means a
convention facility owned by the state, a county, a municipality
or other public entity or instrumentality and shall include
includes all facilities, including armories, commercial, office,
community service and parking facilities and publicly owned
facilities constructed or used for the accommodation and
entertainment of tourists and visitors, constructed in
conjunction with the convention center and forming reasonable
appurtenances thereto.
(3)Fiscal year. -- "Fiscal year" means the year beginning
the first day of July and ending the thirtieth day of June of the
next calendar year.
(4)Net proceeds. -- "Net proceeds" means the gross amount
of tax collections less the amount of tax lawfully refunded.
(5)Promotion of the arts. -- "Promotion of the arts" means
activity to promote public appreciation and interest in one or
more of the arts. It includes the promotion of music for of all
types, the dramatic arts, dancing, painting and the creative arts
through shows, exhibits, festivals, concerts, musicals and plays.
(6)Recreational facilities. -- "Recreational facilities"
means and includes any public park, parkway, playground, public
recreation center, athletic field, sports arena, stadium, skating
rink or arena, golf course, tennis courts and other park and
recreation facilities, whether of a like or different nature,
that are owned or leased by a county or municipality.
(7)Region. -- "Region" means an area consisting of one or
more counties that have agreed by contract to fund a convention
and visitor's bureau to promote those counties.
(8)Regional travel council. -- "Regional travel council"
means a nonstock, nonprofit corporation, with a full-time staff
working exclusively to promote tourism and to attract
conventions, conferences and visitors to the region of this state
served by the regional travel counsel.
(9)Historic site. -- "Historic site" means any site listed
on the United States national register of historic places, or
listed by a local historical landmarks commission, established
under state law, when
such the
sites are owned by a city, a
county or a nonprofit historical association and are open from
time to time to accommodate visitors.
NOTE: The purpose of this bill is to permit municipalities
to increase the rate of the hotel occupancy tax from the current
rate of 3% up to a maximum rate of 6% and to allow a portion of the revenues generated by this tax to be used (i) to support bond
issues to finance the construction and improvement of a
convention facilities and facilities established for the
promotion of arts and sciences; (ii) to provide a source for
contributions by a municipality to promote arts and sciences or
to pay debt service in connection with any financing obtained for
such purpose; or (iii) to secure payment of principal or interest
or both in connection with any financing obtained in connection
with publicly owned convention facilities or to promote arts and
sciences. The bill does not alter the requirement under existing
law that at least 50% of the revenues attributable to the tax,
calculated on the basis of a maximum tax rate of 3%, be
appropriated to any convention and visitor's bureau located
within the municipality or county. The bill expands the types of
projects which may be financed by bond issues supported by hotel
occupancy tax revenues.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.