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SPONSOR: |
Sanchez, B. |
DATE TYPED: |
03/05/03 |
HB |
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SHORT TITLE: |
Hospitality Fee Act |
SB |
792/aSCORC |
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ANALYST: |
Padilla |
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REVENUE
|
Estimated Revenue |
Subsequent Years Impact |
Recurring or
Non-Rec |
Fund Affected |
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FY03 |
FY04 |
|
|
|
|
|
Indeterminate—See
Narrative |
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Recurring |
Local
Government |
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|
|
|
|
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(Parenthesis ( ) Indicate Revenue Decreases)
Relates to SB1, HB 876
LFC Files
Responses
Received From
Department
of Finance and Administration
City
of Albuquerque
SUMMARY
Synopsis
of SCORC Amendment
The Senate Corporations and Transportation
Committee amendment establishes that the revenue Albuquerque generates as a
result of the “hospitality fee” can be used to contract with organizations,
whether non-profit or for-profit, for advertising and public relations
services. The original bill limited the contracts to non-profit
organizations. Fifty percent of the
revenue can be used for such purposes.
Synopsis
of Original Bill
Senate Bill 792 authorizes certain
municipalities to impose a “hospitality fee” on the users of tourist
accommodations. Fifty percent of the
proceeds from the fee shall be used to finance improvements to a municipal
convention center; the remaining fifty percent are to be used for marketing the
municipality and its facilities. The
municipality must be in a Class A county with a 2000 census population of over
250,000. The hospitality fee cannot
exceed more than one percent of the gross room revenue per day. “Tourist accommodation” is defined broadly
and includes temporary stays at hotels, motels, apartments, trailer courts,
etc.
The bill requires the municipality to report
quarterly to DFA on collection and expenditure of the hospitality fee
revenue. The bill establishes the
requirements of the ordinance needed by the municipality to administer a
hospitality fee. The bill provides
penalties that the municipality can impose on persons failing to pay the fee or
otherwise violating the hospitality fee ordinance.
The bill allows the municipality to issue
revenue bonds to pay for the improvements to the convention center.
The bill is to be repealed July 1, 2013.
Significant
Issues
The municipality that meets the definition given in the bill is Albuquerque. According to the City of Albuquerque, the Central New Mexico Innkeepers association has proposed and supports this bill. The revenue is required to make needed capital improvements to the Albuquerque Convention Center, including such upgrades as high-speed telecommunications connections. In order to attract large conventions and other meetings, such improvements are believed necessary.
The revenue would also be used to market Albuquerque for tourism and convention activities. Albuquerque would be able to use the revenue to contract with non-profit organizations for such services.
The City of Albuquerque notes that the hospitality fee created by this bill is an industry-supported “self-tax.”
FISCAL IMPLICATIONS
Revenue estimates from a one-percent hospitality
fee in Albuquerque were unavailable.
RELATIONSHIP
SB 1 and HB 876 also allow certain
municipalities to impose fees for the financing of new convention center
facilities or the improvement of existing facilities. SB 1 applies to a new convention center in Las Cruces. HB 876 applies to the construction of a
civic and convention center in Santa Fe.
LP/prr