House Bill 5311, which would allow The Woodlands Township to collect mixed-beverage taxes, passed the Senate on May 17 and now awaits Gov. Greg Abbott's signature.

Why it matters

The bill would allow the township to be treated “as an incorporated municipality with regard to the disposition of mixed-beverage tax proceeds,” according to the bill. As an unincorporated special-purpose district, the township is not able to collect mixed-beverage taxes. Under this bill, however, those taxes could be collected within the township.

According to a fiscal analysis on the Texas Legislature website, the bill would mean 10.7% of the revenue from mixed-beverage taxes within the area retained by the state would go to the township beginning Oct. 1.

The bill also would create a hotel room assessment, according to information from the township. The additional funding mechanism will benefit marketing, sales and promotion for the township, officials said.

Board chair Ann Snyder said the township estimates to collect an additional $2 million in revenue from hotel room occupancy and up to $1.4 million in mixed-beverage taxes annually as a result of HB 5311.

What they’re saying

“This bill is the result of strong partnerships amongst the township board, state elected officials, and our hotel and hospitality industry. This bill would keep the mixed-use alcohol tax already being paid locally within The Woodlands Township to use for programs and services that benefit our residents and businesses,” Snyder said. “The bill also provides a great economic development tool for our hotels to promote our community for conventions and tourism bringing increased business for our community.”

Based on an analysis of the bill on the Texas Legislature website, a clarifying amendment from office of the Texas comptroller of public accounts states the allocation of mixed-beverage tax returns would start in October.

“According to the state comptroller, local governments raise about $1 in sales tax revenue for every $7 in property tax revenue. For The Woodlands, it’s just the reverse,” Director of Community Relations Nick Wolda said in an email.

As of May 30, the bill is awaiting signature from the governor. If signed into law by Gov. Greg Abbott, it will take effect Sept. 1.