HCS SB 365 -- TOURISM

SPONSOR:  Steelman (Overschmidt)

COMMITTEE ACTION:  Voted "do pass" by the Committee on Tourism,
Recreational and Cultural Affairs by a vote of 17 to 0.

This substitute authorizes a tourism sales tax in certain areas,
establishes tourism community enhancement districts, and revises
certain provisions relating to the supplemental revenue fund.

TOURISM TAX IN CERTAIN AREAS

The City of Cuba is added to those cities and counties
authorized to submit to their voters a hotel/motel tax of
between 2% and 5% for funding the promotion of tourism.

The substitute allows the governing body of any city or county
having more than 350 hotel and motel rooms inside its
jurisdiction to impose a room tax upon voter approval of not
more than 5% on all transient guests of hotels or motels if it
has not done so under other provisions of law.  The proceeds
from this tax will be used for the promotion of tourism and for
funding a convention and visitors bureau.

The City of Maryland Heights is allowed to impose a tax of not
more than 0.5%.  The substitute spells out the ballot language
and procedures for adoption of the tax.

The governing bodies of counties containing at least 700 miles
and not more than 900 miles of shoreline of a Corps of Engineers
lake may order an election for a sales tax, not to exceed 1.5%,
for promoting water quality, infrastructure, and tourism
programs designed to affect economic development within the
approving county.  The following counties will be affected:
Taney, Stone, Barry, Ozark, Camden, Miller, and Morgan.

The revenue from the tax will be placed in a special trust
fund.  The governing body of the county will administer the
moneys in the fund in the following manner:  one-third of the
yearly revenue collected will be for tourism, one-third for
water quality, and one-third for infrastructure.

The Department of Revenue will collect and distribute the retail
sales tax to the appropriate county treasurer.  All expenditures
from the fund will be by appropriation enacted by the governing
body of the county.  Various programs are described for which
money in the fund may be spent.

The substitute contains a mechanism to repeal the sales tax if
at least 20% of voters of the county submit a proposal to repeal
the tax and it is approved by a majority of the voters of the
county.

TOURISM COMMUNITY ENHANCEMENT DISTRICTS

Any county, city, town, or village with a population of less
than 100,000 inhabitants is allowed to establish a tourism
community enhancement district.  The district will be a body
corporate and politic of the state and may impose a sales tax of
up to 1%.

To establish a tourism community enhancement district, a
petition setting forth the boundaries, the maximum proposed
sales tax, and signatures containing at least 2% of the
registered voters of a county, city, town, or village within the
proposed district must be filed with the clerk of the county,
city, town, or village that includes a majority of the area
within the proposed district.  If the governing body, following
a hearing, decides to establish the proposed district, it must
adopt an order or ordinance.

Each tourism community enhancement district will have at least 5
directors.  The terms, selection, and duties of the directors
and other officers are spelled out.  The procedures for
submitting and implementing a tax proposal to residents of a
district are outlined in the substitute.

Expenditures from the tourism community enhancement district
sales tax will be as follows:

(1)  10% of any revenues will be used for education purposes;

(2)  10% will be used for senior citizen, youth, or community
enhancement purposes within the district;

(3)  75% will be used by the board of directors for marketing,
advertising, and promotion of tourism;

(4)  2% will be distributed among each destination marketing
organization located within each school district in the district
based upon the amount of sales tax collected within each school
district;

(5)  2% will be transmitted to the not-for-profit organization
conducting and administering the marketing plan within the
district; and

(6)  1% will be for the collection of the tax (Department of
Revenue).

The substitute contains procedural provisions for the expansion
of a district and board and for the dissolution of a tax or
district.

TOURISM SUPPLEMENTAL REVENUE FUND

Currently and through Fiscal Year 2010, a portion of the
increase in state sales taxes collected from the retail sale of
tourist-oriented goods and services will be used to determine
the amount of increase to the transfer to the Tourism
Supplemental Revenue Fund.  The amount to be transferred is
determined by computing the state sales taxes derived from
retail sale of tourist-oriented goods and services from the
third year prior to the fourth year prior to the fiscal year the
transfer is made.  If the increase in the sales taxes is at
least 3% more than the fourth prior year, then half of the
amount above a 3% increase will be used to determine the amount
of increase in the transfer to the fund.  Transfers have a $3
million cap in each year.

The substitute decreases the 3% to 2% and indexes the $3 million
maximum amount of increase to the growth of tourist-oriented
sales and services.

Sales of tourist-oriented goods and services are those sales by
businesses registered with the Department of Revenue under
certain SIC Codes or their successors.

An inactive SIC Code is removed and replaced with a new SIC Code.

FISCAL NOTE:  Transfer from General Revenue Fund of $0 in FY
2002, $2,322,430 in FY 2003, and $4,067,850 in FY 2004.
Transfer to Tourism Supplemental Revenue Fund of $0 in FY 2002,
$2,322,430 in FY 2003, and $4,067,850 in FY 2004.

PROPONENTS:  Supporters say that tourism is important to the
City of Cuba.  This will help the city operate a tourism center.

Testifying for the bill were Senator Steelman; and City of Cuba.

OPPONENTS:  There was no opposition voiced to the committee.

Robert Triplett, Legislative Analyst

Missouri House of Representatives
Last Updated November 26, 2001 at 11:47 am