HOUSE BILL NO. 273

INTRODUCED BY B. RANEY, L. GROSFIELD, B. BARNHART, G. BECK, J. BOHLINGER,

C. CHRISTIAENS, J. COBB, B. CRIPPEN, S. DOHERTY, D. EWER, S. GALLUS, K. GALVIN-HALCRO,

M. GUGGENHEIM, J. HURDLE, R. JOHNSON, M. MCCANN, R. PECK, B. SIMON, E. SWANSON,

C. SWYSGOOD, C. TUSS

A BILL FOR AN ACT ENTITLED: "AN ACT REVISING THE ALLOCATION AND USE OF THE LODGING FACILITY USE TAX; REPLACING PERCENTAGE ALLOCATIONS WITH SPECIFIC AMOUNTS; ELIMINATING ALLOCATIONS TO REGIONAL NONPROFIT TOURISM CORPORATIONS; PROVIDING ALLOCATIONS TO LOCAL GOVERNMENTS TO BE USED FOR TOURISM-RELATED PROMOTIONS, INFRASTRUCTURE, AND SERVICES ; PROVIDING FOR THE CREATION OF COMMITTEES TO RECOMMEND PROJECTS; PROVIDING FOR GRANTS TO CERTAIN LOCAL GOVERNMENTS; AMENDING SECTIONS 2-15-1816, 15-65-101, AND 15-65-121, MCA; REPEALING SECTION 15-65-122, MCA; AND PROVIDING AN EFFECTIVE DATE."

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:

Section 1. Section 2-15-1816, MCA, is amended to read:

"2-15-1816. Tourism advisory council. (1) There is created a tourism advisory council.

(2) The council is composed of not less than 12 members appointed by the governor from Montana's private sector travel industry and includes at least one member from Indian tribal governments .

(3) Members of the council shall serve staggered 3-year terms, subject to replacement at the discretion of the governor.

(4) The council shall:

(a) advise the department of commerce relative to tourism promotion;

(b) advise the governor on significant matters relative to Montana's travel industry; and

(c) administer the grant program provided for in [section 6].

(5) The department of commerce shall adopt rules that may be necessary to implement and administer Title 15, chapter 65, part 1, and this section.

Section 2. Section 15-65-101, MCA, is amended to read:

"15-65-101. Definitions. For purposes of this part, the following definitions apply:

(1) "Accommodation charge" means the fee charged by the owner or operator of a facility for use of the facility for lodging, including bath house facilities, but excluding charges for meals, transportation, entertainment, or any other similar charges.

(2) "Campground" means a place, publicly or privately owned, used for public camping where persons may camp, secure tents, or park individual recreational vehicles for camping and sleeping purposes. The term does not include that portion of a trailer court, trailer park, or mobile home park intended for occupancy by trailers or mobile homes for resident dwelling purposes for periods of 30 consecutive days or more.

(3) "Facility" means a building containing individual sleeping rooms or suites, providing overnight lodging facilities for periods of less than 30 days to the general public for compensation. The term includes a facility represented to the public as a hotel, motel, campground, resort, dormitory, condominium inn, dude ranch, guest ranch, hostel, public lodginghouse, or bed and breakfast facility. The term does not include any health care facility, as defined in 50-5-101, any facility owned by a corporation organized under Title 35, chapter 2 or 3, that is used primarily by persons under the age of 18 years for camping purposes, any hotel, motel, hostel, public lodginghouse, or bed and breakfast facility whose average daily accommodation charge for single occupancy does not exceed 60% of the amount authorized under 2-18-501 for the actual cost of lodging for travel within the state of Montana, or any other facility that is rented solely on a monthly basis or for a period of 30 days or more.

(4) "Tourism-related infrastructure" includes visitor centers, rest areas, restrooms, parking facilities, signs, museums, trails, zoos, parks, and other facilities and infrastructure used by travelers or that attract travelers to an area."

Section 3. Section 15-65-121, MCA, is amended to read:

"15-65-121. (Temporary) Distribution of tax proceeds -- general fund loan authority. (1) The proceeds of the tax imposed by 15-65-111 must, in accordance with the provisions of 15-1-501, be deposited in an account in the state special revenue fund to the credit of the department . The department may spend from that account in accordance with an expenditure appropriation by the legislature based on an estimate of the costs of collecting and disbursing the proceeds of the tax. The appropriation for collecting and disbursing the proceeds of the tax may not exceed $150,000. Before allocating the balance of the tax proceeds in accordance with the provisions of 15-1-501 and as provided in subsections (1)(a) through (1)(e) of this section, the department shall determine the expenditures by state agencies for in-state lodging for each reporting period and deduct 4% of that amount from the tax proceeds received each reporting period. The amount deducted must be deposited in the general fund. For fiscal years ending June 30, 2000, and June 30, 2001, the amount of $400,000 each year must be deposited in the Montana heritage preservation and development account provided for in 22-3-1004. The balance of the tax proceeds received each reporting period and not deducted pursuant to the expenditure appropriation or deposited in the Montana heritage preservation and development account or the general fund is statutorily appropriated, as provided in 17-7-502, and must be transferred to an account in the state special revenue fund to the credit of the department of commerce , to the Montana historical society, to the university system, and to the department of fish, wildlife, and parks, as follows:

(a) $150,000 to the Montana historical society to be used for the installation or maintenance of roadside historical signs and historic sites and for the protection, preservation, curation, and interpretation of state park historical and cultural resources and other state-owned historic property;

(b) $250,000 to the institute for travel research at the university of Montana-Missoula for the establishment and maintenance of a Montana travel research program;

(c) $1 million to the department of fish, wildlife, and parks for the maintenance of state parks and fishing access sites that do not charge resident fees;

(d) $4 million to be used directly by the department of commerce for tourism promotion and promotion of the state as a location for the production of motion pictures and television commercials; and

(e) the remainder to be distributed by the department to local governments as provided in subsections (2) and (3)

. The allocation in subsections (2) and (3) may be made only if the county, including cities and towns within the county, has generated at least $15,000 in lodging facility use tax revenue in the previous calendar year. The funds that are not allocated to a county, city, or town because the local governments did not generate the required amount of lodging facility use tax must be allocated to an account in the state special revenue fund to be used as provided in [section 6].

(2) If the tax provided for in this part is collected within the incorporated boundaries of a city or town, then the department shall determine the ratio that the funds collected within the city or town bears to the total amount of funds available for distribution to local government and shall allocate that amount of funds to each city or town.

(3) If the funds provided for in this part are collected outside of the boundaries of an incorporated city or town or in a consolidated government, then the department shall determine the ratio that the funds collected outside of the city or town bears to the total amount of funds available for distribution to local government and shall allocate that amount of funds to each county or consolidated government.

(4) Funds received by a local government pursuant to subsection (2) or (3) must be used for tourism promotion, tourism-related infrastructure, and tourism-related local government services. A local government may use the funds for grants to nonprofit organizations for purposes that qualify under this subsection.

(Terminates July 1, 2001--sec. 23(3), Ch. 469, L. 1997.)

15-65-121. (Effective July 1, 2001) Distribution of tax proceeds -- general fund loan authority. (1) The proceeds of the tax imposed by 15-65-111 must, in accordance with the provisions of 15-1-501, be deposited in an account in the state special revenue fund to the credit of the department . The department may spend from that account in accordance with an expenditure appropriation by the legislature based on an estimate of the costs of collecting and disbursing the proceeds of the tax. The appropriation for collecting and disbursing the proceeds of the tax may not exceed $150,000. Before allocating the balance of the tax proceeds in accordance with the provisions of 15-1-501 and as provided in subsections (1)(a) through (1)(e) of this section, the department shall determine the expenditures by state agencies for in-state lodging for each reporting period and deduct 4% of that amount from the tax proceeds received each reporting period. The amount deducted must be deposited in the general fund. The balance of the tax proceeds received each reporting period and not deducted pursuant to the expenditure appropriation or deposited in the general fund is statutorily appropriated, as provided in 17-7-502, and must be transferred to an account in the state special revenue fund to the credit of the department of commerce , to the Montana historical society, to the university system, and to the department of fish, wildlife, and parks, as follows:

(a) $150,000 to the Montana historical society to be used for the installation or maintenance of roadside historical signs and historic sites and for the protection, preservation, curation, and interpretation of state park historical and cultural resources and other state-owned historic property;

(b) $250,000 to the institute for travel research at the university of Montana-Missoula for the establishment and maintenance of a Montana travel research program;

(c) $1 million to the department of fish, wildlife, and parks for the maintenance of state parks and fishing access sites that do not charge resident fees;

(d) $4 million to be used directly by the department of commerce for tourism promotion and promotion of the state as a location for the production of motion pictures and television commercials; and

(e) the remainder to be distributed by the department to local governments as provided in subsections (2) and (3)

. The allocation in subsections (2) and (3) may be made only if the county, including cities and towns within the county, has generated at least $15,000 in lodging facility use tax revenue in the previous calendar year. The funds that are not allocated to a county, city, or town because the local governments did not generate the required amount of lodging facility use tax must be allocated to an account in the state special revenue fund to be used as provided in [section 6].

(2) If the tax provided for in this part is collected within the incorporated boundaries of a city or town, the department shall determine the ratio that the funds collected within the city or town bears to the total amount of funds available for distribution to local government and shall allocate that amount of funds to each city or town.

(3) If the funds provided for in this part are collected outside of the boundaries of an incorporated city or town or in a consolidated government, then the department shall determine the ratio that the funds collected outside of the city or town bears to the total amount of funds available for distribution to local government and shall allocate that amount of funds to each county or consolidated government.

(4) Funds received by a local government pursuant to subsection (2) or (3) must be used for tourism promotion, tourism-related infrastructure, and tourism-related local government services. A local government may use the funds for grants to nonprofit organizations for purposes that qualify under this subsection.

"

NEW SECTION. Section 4. Local tourism resource panel -- membership -- functions. (1)(a) A local government receiving funds under 15-65-121 shall create a local tourism resource panel. The panel must consist of five members appointed by the governing body and must include the following:

(i) a member representing the lodging industry in that jurisdiction;

(ii) a nonelected employee of the local government familiar with local tourism-related infrastructure needs;

(iii) a local retail business person;

(iv) a person familiar with area attractions and the infrastructure and service needs of those attractions; and

(v) a person familiar with local promotional needs.

(b) Only one local government employee may serve on the panel.

(2) The panel shall accept applications for grants to fund requests under this part from any person or nonprofit entity or the local government. The panel shall evaluate applications to determine those that meet the intent of this part, prioritize the applications, and forward the applications to the local government for review, approval, and the granting of money. The panel may not submit an application for approval unless it is approved by at least three members of the panel.

(3) The local government may not award a grant unless the application has been reviewed and approved by the panel. However, the local government is not required to approve grants recommended by the panel.

NEW SECTION. Section 5. Institute for travel research -- committee. (1) There is an institute for travel research at the university of Montana-Missoula.

(2) The commissioner of higher education shall appoint a nine-member committee to recommend travel research projects to the institute. The committee must consist of representatives of:

(a) the tourism advisory council;

(b) the department of fish, wildlife, and parks;

(c) the Montana historical society;

(d) the cooperative extension service;

(e) the bureau of business and economic research;

(f) the lodging industry;

(g) the environmental studies graduate program at the university of Montana-Missoula;

(h) Montana resident recreationists; and

(i) resident landowners whose property is impacted by tourism.

NEW SECTION. Section 6. Visitor center and primitive camping grants. (1) The tourism advisory council shall use the funds allocated under 15-65-121(2) for the purpose of making grants to counties, cities, and towns that do not receive an allocation of lodging facility use taxes.

(2) Grants must be used for visitor information centers or for the development and operation of primitive campgrounds. Primitive campgrounds are subject to the limits on development provided for primitive parks in 23-1-117.

(3) The tourism advisory council shall develop procedures for the application for and awarding of grants.

NEW SECTION. Section 7. Repealer. Section 15-65-122, MCA, is repealed.

NEW SECTION. Section 8. Codification instruction. [Sections 4 through 6] are intended to be codified as an integral part of Title 15, chapter 65, part 1, and the provisions of Title 15, chapter 65, part 1, apply to [sections 4 through 6].

NEW SECTION. Section 9. Effective date. [This act] is effective July 1, 1999.

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