Relating to the use of hotel occupancy tax revenue for certain public improvement projects by certain municipalities.

HB 4412 allows specific Texas municipalities (those bordering Mexico, with hotel occupancy rates exceeding 90% and over 40% of visitors staying in hotels) to use up to 25% of their unspent hotel tax revenue for tourism-related public projects. The bill requires these cities to maintain funding for existing priorities at pre-2025 levels and cap their hotel tax rate at 2% within eight years of using the funds. It prohibits using these tax dollars for tourism projects after December 31, 2034, and expires entirely by that date. This bill directly affects qualifying border municipalities with significant tourism economies.