Senate Bill No. 237
(By Senators McCabe, Bailey, Edgell, McKenzie, Kessler and
Foster)
____________
[Introduced February 21, 2005; referred to the Committee
on Government Organization; and then to the Committee on
Finance.]
____________
A BILL to amend and reenact §7-18-2, §7-18-9 and §7-18-14 of the
Code of West Virginia, 1931, as amended, all relating to
the hotel occupancy tax generally; allowing municipalities
to increase the rate of tax imposed to six percent;
requiring public hearings on proposed increases; listing
certain findings; and providing a misdemeanor penalty for
members of governing bodies who vote to make expenditures
for purposes not specified in said article.
Be it enacted by the Legislature of West Virginia:
That §7-18-2, §7-18-9 and §7-18-14 of the Code of West
Virginia, 1931, as amended, be amended and reenacted, all to
read as follows:
ARTICLE 18. HOTEL OCCUPANCY TAX.
§7-18-2. Rate of tax.
The rate of tax imposed shall be three percent of the
consideration paid for the use or occupancy of a hotel room:
Provided: That on and after the first day of July, two thousand
five, a municipality may by ordinance increase the rate of tax
imposed in this section to not more than six percent of the
consideration paid for the use or occupancy of a hotel room.
Prior to the second reading of an ordinance proposed by a
municipality to increase the rate of tax, the municipality shall
conduct a properly noticed public hearing on the issue. Such
The consideration
paid for the use or occupancy of a hotel room
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.
§7-18-9. Total amount collected to be remitted.
No profit shall A profit may not accrue to any person as
a result of the collection of the tax authorized under this
article. Notwithstanding that the total amount of
such 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 imposed under this article for the occupancy
of a hotel room or rooms, 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.
(b)
Required expenditures. -- At least fifty percent of the
net revenue receivable during the fiscal year by a county or a
municipality pursuant to this article shall be expended in the
following manner 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 municipality shall appropriate the
percentage required by this subsection to that bureau. If a
convention and visitor's bureau is not located within such
municipality, county or region, then the percentage
appropriation required by this subsection shall be appropriated
as follows:
(i) Any hotel located within such municipality, county or
region may apply to such municipality for an appropriation to
such hotel of a portion of the tax authorized by this article
and collected by such hotel and remitted to such municipality,
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 tax allocable to such hotel shall not exceed seventy-five
percent of that portion of such tax collected and remitted by
such hotel which is required to be expended pursuant to this
subsection:
Provided, That prior to appropriating any moneys
to such hotel such municipality shall require the submission of, and give approval to, a budget setting forth the proposed uses
of such 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 bureaus in such portion as the city council 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 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 county or region may
apply to such county for an appropriation to such hotel of a
portion of the tax authorized by this article and collected by
such hotel and remitted to such 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 tax allocable to such
hotel shall not exceed seventy-five percent of that portion of
such tax collected and remitted by such hotel which is required
to be expended pursuant to this subsection:
Provided, That prior to appropriating any moneys to such hotel such county
shall require the submission of, and give approval to, a budget
setting forth the proposed uses of such 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 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 finding. --
The Legislature hereby 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, and
to advance the business prosperity and economic welfare of this
state, it is necessary to enhance recreational and tourism
opportunities. Therefore, in order to promote recreation and
tourism, the Legislature finds that public financial support
should be provided for constructing, equipping, improving and
maintaining projects, agencies and facilities which promote
recreation and tourism. The Legislature
hereby also 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 for one or more of the purposes set
forth in this subsection, but for no other purpose. The
purposes 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 payment of principal or interest or both on revenue
bonds issued to finance such convention facilities;
(3) The promotion of conventions;
(4) The construction, operation or maintenance of public
parks, tourist information centers and recreation facilities
(including land acquisition);
(5) The promotion of the arts;
(6) Historic sites;
(7) Beautification projects; or
(8) 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 acute medical
care services directly 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.
(d)
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 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 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 all
facilities, including armories, commercial, office, community
service and parking facilities and publicly owned facilities
constructed or used for the accommodation and entertainment of
tourist 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 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 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 council.
(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 sites are owned by a city, a county
or a nonprofit historical association and are open, from time
to time, to accommodate visitors.
(e) Any member of a governing body who willingly and
knowingly votes to or causes to be expended moneys generated
by the provisions of this section for purposes other than
specifically set forth in this section is guilty of a
misdemeanor and, upon conviction thereof, shall be fined not
more than one hundred dollars.
_________
(NOTE: The purpose of this bill is to allow municipalities
to increase the rate of the hotel occupancy tax imposed to six
percent. Under the bill, a municipality must hold a public
hearing on the proposed increase. The bill also makes
additional findings with regard to expenditures and it provides
a misdemeanor penalty for members of governing bodies who vote
to make expenditures for purposes not specified in the article.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.)