Hotel Occupancy Tax

What Is the Local Hotel Occupancy Tax (HOT)?

When someone stays at a hotel, motel, bed & breakfast, or other short-term lodging facility in the Town of Pecos City, a small tax is added to their bill. This is called the Hotel Occupancy Tax — or “HOT” for short.

It is paid by visitors, not residents. This allows our city to collect revenue from tourism for tourism without placing the burden on local taxpayers

What Can the Funds Be Used For?

By law, Hotel Occupancy Tax revenue can only be used for projects that promote tourism. These funds are restricted to specific, tourism-related purposes such as:

Convention Centers and Visitor Information Centers: Acquisition, construction, expansion, improvement, equipping, repair, operation, and maintenance of convention center facilities or visitor information centers.

Registration of Convention Delegates: Providing facilities, personnel, and materials necessary for the registration of convention delegates or registrants.

Advertising, Solicitation, and Promotion: Conducting advertising campaigns and promotional programs aimed at attracting tourists, convention delegates, and registrants to Pecos.

Promotion of the Arts: Supporting arts initiatives that have a direct impact on tourism and the hotel industry, including music, dance, drama, visual arts, film, literature, architecture, and related artistic fields. Eligible programs must demonstrate they increase hotel stays or attract visitors to arts-related events.

Historical Restoration and Preservation: Funding restoration and preservation of historic sites and museums, as well as promoting these sites to encourage tourist visitation.

Sporting Event Expenses and Venues: Covering promotional and operational expenses, as well as acquiring, constructing, improving, and equipping venues for sporting events that attract a majority of participants from outside the area and generate significant hotel occupancy and economic activity.

Transportation for Tourists: Funding transportation services that move tourists from hotels to key destinations such as the city’s commercial center, convention centers, other hotels, or nearby tourist attractions. (Note: These funds cannot be used for general public transit services.)

Tourist Signage: Installing and maintaining signs that guide tourists to frequently visited sights and attractions within the municipality.

How to Apply for Hotel Occupancy Tax Funds?

The Town of Pecos City welcomes applications from groups and businesses whose programs align with one or more of the eligible uses described above. If you believe your project supports tourism and the hotel industry, you may apply for funding.

Application Process:

Submit a written request along with the official application form at least 90 days prior to the date funding is needed.

Applications are reviewed by the Hotel Occupancy Tax Advisory Board and then presented to the City Council at the earliest possible regularly scheduled meetings.

Applicants may be invited to attend the meeting to answer questions regarding their request.

Applicants will be notified at least one week prior to the meeting with details about the time and location.

The Advisory Board will provide a recommendation based on the application, and the City Council will make the final funding decision.

For detailed application instructions and to download the official form, please visit: Hotel Occupancy Tax Application

Legal Restrictions on Use of Hotel Occupancy Tax Funds

It's crucial to note that the hotel occupancy tax funds cannot be used for general revenue or general governmental operations. The funds must directly contribute to increasing tourism and convention activity. If an event or facility funded by this tax does not directly enhance tourism or the hotel and convention industries, it cannot legally receive funding from the tax.

Conclusion

The hotel occupancy tax is a vital tool for promoting tourism and supporting the convention industry in local areas. By adhering to the specific guidelines outlined in Texas law, cities and counties can use these funds to enhance the local economy and attract visitors, all while maintaining strict oversight to ensure the tax revenue is spent efficiently and appropriately.