Relating to the use of municipal hotel occupancy tax revenue in certain municipalities.

HB 3118 limits how Texas municipalities can spend revenue from hotel occupancy taxes, restricting it exclusively to tourism and convention industry promotion. The bill specifies seven permitted uses: building/convention centers, visitor centers, tourism advertising, arts promotion, historic preservation projects near tourist sites, and certain sporting events meeting population criteria. It does not allow general municipal spending with these funds. The law directly affects all Texas municipalities collecting hotel occupancy taxes. This amendment to the Tax Code clarifies that such revenue must directly support tourism economic development.