(A)   There is hereby levied a tax of 7% on the consideration paid for a room in a hotel on every occupant who, under a lease, concession, permit, right of access, license, contract or agreement, pays for the use or possession or for the right to the use or possession of a room that is in a hotel, costs $2 or more each day, and which is ordinarily used for sleeping.
   (B)   Exceptions are as follows:
      (1)   No tax shall be imposed hereunder upon a permanent resident;
      (2)   No tax shall be imposed hereunder on the United States, the state or an agency, institution, board or commission of the state, other than an institution of higher education. For purposes of this chapter, INSTITUTION OF HIGHER EDUCATION has the meaning assigned by Tex. Education Code Art. 61.003 (Vernon 1991). No tax shall be imposed on an officer or employee of a governmental entity described in this division (B)(2) when traveling on or otherwise engaged in the course of official duties for the governmental entity.
   (C)   The City Council shall be authorized to reduce the rate of taxation applied to hotels within the city’s extraterritorial jurisdiction when necessary to ensure that the combined rate of state, county and municipal hotel occupancy taxes in the extraterritorial jurisdiction does not exceed 15% of the price paid for a room in a hotel.
(Ord. 000215, passed 2-15-2000)