Levy and collection of excise taxes upon motor vehicle rental charges; expenditure of taxes; purpose.

(a) (1) The governing authority of each municipality in this state may levy and collect an excise tax upon the rental charge collected by a rental motor vehicle concern when such charge constitutes a taxable event for purposes of sales and use tax under Article 1 of Chapter 8 of this title. Within the territorial limits of the special district located within the county, each county in this state may levy and collect an excise tax upon the rental charge collected by a rental motor vehicle concern when such charge constitutes a taxable event for purposes of sales and use tax under Article 1 of Chapter 8 of this title. The tax levied pursuant to this article shall be levied or collected at the rate of 3 percent of the rental charges. The tax levied pursuant to this article shall be imposed only at the time when and place where a customer pays sales tax with respect to the rental charge. The customer who pays a rental charge that is subject to a tax levied as provided in this article shall be liable for the tax. The tax shall be paid by the customer to the rental motor vehicle concern. The tax shall be a debt of the customer to the rental motor vehicle concern until it is paid and shall be recoverable at law in the same manner as authorized for the recovery of other debts. The rental motor vehicle concern collecting the tax shall remit the tax to the governing authority imposing the tax, and the tax remitted shall be a credit against the tax imposed on the rental motor vehicle concern. Every rental motor vehicle concern subject to a tax levied as provided in this article shall be liable for the tax at the applicable rate on the charges actually collected or the amount of taxes collected from the customers whichever is greater.

(2) A county or municipality levying an excise tax as provided in paragraph (1) of this subsection shall only levy such tax by ordinance which shall specify with particularity the authorized projects or purposes, or both, for which proceeds of the tax are to be expended and shall apply in each fiscal year during which the tax is collected such tax proceeds for the purpose of:

(A) Promoting industry, trade, commerce, and tourism;

(B) Capital outlay projects consisting of the construction of convention, trade, sports, and recreational facilities, or public safety facilities, including the acquiring, constructing, renovating, improving, and equipping of parking facilities, pedestrian walkways, plazas, connections, and other public improvements associated with such convention, trade, sports, and recreational facilities or public safety facilities or the retirement of debt issued with respect to such capital outlay projects; and

(C) Maintenance and operation expenses or security and public safety expenses associated with capital outlay projects funded pursuant to subparagraph (B) of this paragraph.

(3) Amounts collected pursuant to this article may be expended pursuant to a contract or contracts with a county, municipality, development authority, downtown development authority, urban redevelopment authority, recreation authority, or any combination of two or more of such entities. Nothing in this article shall be construed to limit the formation of intergovernmental contracts pursuant to the authority granted by Article IX, Section III, Paragraph I of the Constitution of this state to accomplish the purposes described in paragraph (2) of this subsection including the construction and maintenance of facilities located outside the special district within which the excise tax is levied and collected and which benefit the special district.

(4) Any tax levied pursuant to this article shall terminate not later than December 31, 2047. Following the termination of the tax, any county or municipality which has levied a tax pursuant to this article shall not thereafter be again authorized to levy a tax under this article.

(5) No tax shall be imposed under this article on the rental charge associated with the rental or lease of a rental motor vehicle if either:

(A) The customer picks up the rental motor vehicle outside this state and returns it in this state; or

(B) The customer picks up the rental motor vehicle in this state and returns it outside this state.

(6) Nothing in this Code section shall be construed to impair, or authorize or require the impairment of, any existing contract or contractual rights.

(7) Any action by a local governing authority to impose the tax authorized under this Code section shall become effective no sooner than the first day of the month following the month of its adoption by the local governing authority.