AUTHORITY TO IMPOSE ASSESSMENTS AND AD VALOREM, SALES AND USE, AND HOTEL OCCUPANCY TAXES; ELECTION

(a) A county or a district may accomplish its purposes and pay the cost of services and improvements by imposing: (1) an assessment; (2) an ad valorem tax; (3) a sales and use tax; or (4) a hotel occupancy tax. (b) A district may impose an ad valorem tax, hotel occupancy tax, or sales and use tax to accomplish the economic development purposes prescribed by Section 52a, Article III, Texas Constitution, if the tax is approved by: (1) the commissioners court of the county that created the district; and (2) a majority of the voters of the district voting at an election held for that purpose. (c) A county must adopt an order providing whether a district has the authority to impose a hotel occupancy tax, sales and use tax, or ad valorem tax, and must provide the rate at which the district may impose the tax. A tax rate approved by the commissioners court and pledged to secure bonds, notes, grant agreements, or development agreements may not be reduced until the obligations of those instruments have been satisfied.