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HB2313

Regular Session

Relating to the authority of certain municipalities to use certain tax revenue for certain qualified projects.

Low
Low Cost
Effective:2025-06-20
Enforcing Agencies

Qualifying Municipalities (specifically targeting Lubbock and Amarillo) • Texas Comptroller of Public Accounts

HB2313
Relating to the authority of certain municipalities to use certain tax revenue for certain qualified projects.
Low Urgency
Passed with Opposition
House Vote100 - 4
YEA
96% in favor104 voting
Senate Vote25 - 6
YEA
NAY
81% in favor31 voting
10
Total Opposition Votes
Cost Impact
Low
Effective
2025-06-20
Enforcing Agencies
Qualifying MunicipalitiesTexas Comptroller of Public Acco...
Primary Author: Rep. Carl Tepper
89th Texas Legislature
jdkey.com
01

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

  • Effective Date: September 1, 2025.
  • Compliance Deadline: Q4 2025. While the law is effective in September, municipalities will likely move immediately to pass designation ordinances to establish the "Base Year" before 2026.
  • Agency Rulemaking: The Texas Comptroller must validate the zone boundaries and the "Base Year" tax amounts. Expect a "regulatory gray zone" between September 2025 and January 2026 regarding the specific definition of "hotel-associated revenue" for non-lodging businesses (e.g., lobby retail).

Immediate Action Plan

  • 1. Audit Tenant Coding: If you are a Hotel GM, verify that all third-party tenants on your property are coded in the Comptroller’s system as located *at* the hotel address, not a generic street address, to ensure their taxes are captured.
  • 2. Prepare Historical Data: Instruct your tax team to compile monthly Sales, HOT, and Mixed Beverage tax returns for the 2024 calendar year to anticipate "Base Year" verification requests.
  • 3. Monitor City Agendas: Assign a government affairs liaison to monitor City Council agendas in Lubbock, Amarillo, Corpus Christi, and Frisco starting August 2025 for the "Project Financing Zone Designation Ordinance."
  • 4. Review POS Categories: Ensure alcohol sales are distinct from food sales in your reporting systems, as these feed into separate tax buckets (Mixed Beverage vs. Sales Tax) eligible for capture.

Operational Changes Required

Contracts

  • Commercial Leases (Hotels): Landlords must review leases for third-party tenants (restaurants, spas, coffee shops located *within* the hotel). Insert clauses requiring tenants to cooperate with City/Comptroller audits to verify their status as "hotel-associated businesses."
  • Chapter 380 Agreements: Developers seeking infrastructure funding must finalize Chapter 380 agreements with the municipality prior to the zone designation ordinance to lock in revenue-sharing terms.

Hiring/Training

  • Finance/Accounting: Staff must ensure Point of Sale (POS) systems strictly segregate revenue streams. "Mixed Beverage" revenue is captured differently than standard "Sales Tax." Misclassification in the General Ledger will result in lost revenue for the municipality and potential audit scrutiny.

Reporting & Record-Keeping

  • Geographic Verification: Businesses must verify their physical address against the specific longitude/latitude coordinates or the "continuous geographic area" map defined in the City's designation ordinance.
  • Base Year Data: Retain all 2024 and 2025 tax remittance records. The City will request this data to model the "Base Year." You must be prepared to contest inaccurate base-year calculations that could artificially lower the captured increment.

Fees & Costs

  • No New Fees: There are no new taxes or fees at the register.
  • Administrative Cost: Expect low-to-moderate internal costs related to data retrieval for City Economic Development departments and Comptroller verification requests.

Strategic Ambiguities & Considerations

  • The "Retroactive" Deadline: Section 1(B)(ii) references a designation deadline of "December 31, 2024" for certain boundary types, yet the law is not effective until September 1, 2025. This drafting conflict creates a legal void. Businesses in zones utilizing "continuous geographic areas" (rather than a simple 3-mile radius) must watch for a technical corrections bill or specific Attorney General guidance.
  • "Hotel-Associated" Scope: The statute is vague on whether revenue from "grab-and-go" kiosks or subleased retail spaces (e.g., a gift shop not owned by the hotel) qualifies. The Comptroller has discretion here; expect strict interpretation until rulemaking clarifies.

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Information presented is for general knowledge only and is provided without warranty, express or implied. Consult qualified government affairs professionals and legal counsel before making compliance decisions.

02

Legislative Timeline

This bill's path through the Texas Legislature

Filed
Jan 31, 2025
Passed House
May 14, 2025
Passed Senate
May 26, 2025
Signed
Jun 20, 2025
TopicsTaxationTaxation--hotel, Motel OccupancyLubbock, City ofCorpus Christi, City ofFrisco, City of
03

House Authors

Rep. Carl TepperRepublican · Primary Author

Senate Sponsors

Sen. Charles PerryRepublican · Primary Sponsor
Cosponsors (1)

Bill Text(with markup)

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

Related Legislation

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More from Rep. Carl Tepper

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Related by Topic

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Quick Reference

Frequently Asked Questions

Common questions about HB2313

Q

What does Texas HB2313 do?

HB2313 authorizes municipalities—specifically targeting Lubbock and Amarillo, with provisions for Corpus Christi and Frisco—to capture incremental State Sales, Hotel Occupancy, and Mixed Beverage taxes generated by hotels and on-site businesses to fund convention center projects. While consumer tax rates remain unchanged, hotel operators and tenants within designated "Project Financing Zones" (PFZ) must strictly verify revenue coding and geographic location to ensure the municipality captures these funds starting in 2026. Implementation Timeline Effective Date: September 1, 2025.

Q

Who authored HB2313?

HB2313 was authored by Texas Representative Carl Tepper during the Regular Session.

Q

When was HB2313 signed into law?

HB2313 was signed into law by Governor Greg Abbott on June 20, 2025.

Q

Which agencies enforce HB2313?

HB2313 is enforced by Qualifying Municipalities (specifically targeting Lubbock and Amarillo) and Texas Comptroller of Public Accounts.

Q

How urgent is compliance with HB2313?

The compliance urgency for HB2313 is rated as "low". Businesses and organizations should review the requirements and timeline to ensure timely compliance.

Q

What is the cost impact of HB2313?

The cost impact of HB2313 is estimated as "low". This may vary based on industry and implementation requirements.

Q

What topics does HB2313 address?

HB2313 addresses topics including taxation, taxation--hotel, motel occupancy, lubbock, city of, corpus christi, city of and frisco, city of.

Legislative data provided by LegiScanLast updated: November 25, 2025

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