Liberty Hill City Council discussed the details of passing a proposed ordinance to include hotel occupancy tax, or HOT, in the city’s code during its June 12 meeting.

According to previous Community Impact reporting, HOT is collected from hotels, or related entities, monthly by cities. Local governments and special-purpose districts can each levy local hotel taxes, generally at rates up to 7%.

The proposed ordinance outlines the collection of tax; how the entities would operate; and the information they would need to provide, such as records of payment, according to city officials.

What happened

City staff wanted to get council’s initial thoughts on the proposed ordinance. The ordinance will then go to the planning and zoning commission for a recommendation before it comes back to council for approval, Interim Director of Planning McKenzi Hicks said during the meeting.

Council member Wade Ashley expressed concerns there was no mention of Airbnbs, Vrbos and other vacation rental companies.

City Attorney Joseph Crawford said the ordinance was drafted to encompass everything state law allows, and per the state law, the definition of hotel includes all forms of short-term rentals.

The zoning, or specifically the areas in the city these entities will be allowed to go, are not included in this ordinance, Crawford said. He said the ordinance only captures the tax funding aspect.

“While we’re waiting on those zoning and business regulations, [this is] just to have the tax flipped on,” he said. “It is a revenue source that can be turned on.”

What happens next?

A public hearing is required before council can consider passing the proposed ordinance. Officials said the public hearing will be before City Council, though a date was not specified.