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Town manager and finance staff outline permitted uses of Flower Mound hotel-occupancy tax; staff estimates about $600,000 in annual revenue
Summary
Town staff briefed the council on legal limits and practical options for spending Flower Mound’s hotel‑occupancy tax, which staff estimates produces about $600,000 annually and is currently used for public art and a fall festival.
Town staff provided a legal and practical overview of the municipal hotel‑occupancy tax (HOT), how state law limits eligible uses, and examples Flower Mound could pursue. John Zagarski presented the briefing and noted the town currently estimates roughly $600,000 per year in HOT revenue, with growth possible as new hotels open.
Zagarski described the “Texas two‑step” test for HOT expenditures: (1) the expenditure must directly enhance and promote tourism and the convention and hotel industry (commonly summarized as “heads and beds”), and (2) the expenditure must fall into one of the statutory…
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