“Shall the City Commission of the City of Vernon, authorize the Business Development Corporation of Vernon to use its Section 4A sales and use tax proceeds to encourage new local businesses and help expanding existing businesses in Vernon and Wilbarger, County Texas, by assisting with projects including buildings, equipment, facilities, expenditures, targeted infrastructure, land and improvements pursuant to Texas Local Government Code §504.152 and §505.158”
Transcript
“Shall the City Commission of the City of Vernon, authorize the
Business Development Corporation of Vernon to use its
Section 4A sales and use tax proceeds to encourage new local
businesses and help expanding existing businesses in Vernon
and Wilbarger, County Texas, by assisting with projects
including buildings, equipment, facilities, expenditures,
targeted infrastructure, land and improvements pursuant to
Texas Local Government Code §504.152 and §505.158”
Who Are We?Who Are We?Formed in 1993 by Vote of the Citizens of Vernon, Texas501(c)3 Type A Economic Development Organization
Primary Job Creation Defined as a company whose majority of product is used outside the local
service region; i.e. on a state, national and international level.Light Manufacturing, Value-Add Food Processing and
Agriculture, Technology-Related IndustryNO RETAIL. NO EXCEPTIONS
By Statute of the 1979 Economic Development Act; Not by the Business Development Corporation
We are hear to take the calculated risks for business development that offer our community the best chance for the highest return on our investment.
How Are We Funded?How Are We Funded?
We are funded by a ½ Cent SALES TAX collected within the VERNON CITY LIMITS
We ARE NOT funded by an Ad-Valorem (Property Tax) in ANYWAY
We DO NOT collect or receive any monies in the County of Wilbarger in any way, shape or form
The past 4 years, our annual operating budget has been based on the projection of collecting $550,000 from the ½ Cent Sales TaxLast year we collected $529,000This year we are currently on Target to Collect ~ $560,000
What Do We Do?What Do We Do?
We are the Lead Economic Development Organization (EDO) for the City of Vernon and Wilbarger County.
We Manage the “Three Legs of the Economic Development Stool”:“Grow our Own” Businesses via Entrepreneurial Start-up“Take Care of Our Own” via our Business Retention and
Expansion program“Recruit New Industry” to our Community via our
Industrial Recruitment Efforts
What is Economic Development?What is Economic Development?“The process of creating wealth through the
mobilization of human, financial, capital, physical and natural resources to generate marketable goods and services” –IEDC
EVERYTHING WE DO IS BASED ON THIS PRINCIPLE!
WE ARE HERE TO CREATE WEALTH AT BOTH THE COMMUNITY AND INDIVIDUAL/PERSONAL LEVELS.
What do we do now?What do we do now?We are a TYPE A Economic Development OrganizationWe strive to create “Primary Jobs”
Jobs that are available at a company for which a majority of the products or services of that company are ultimately exported to regionally, statewide, national, or international markets infusing new dollars into the local economy.
By definition, this excludes:RetailServiceRestaurantsEtc.
What is the Difference Between What is the Difference Between TYPE A and TYPE B Organizations?TYPE A and TYPE B Organizations?
TYPE A Organizations focus on Traditional Economic DevelopmentDIRECT Job Creation
TYPE B Organizations Focus on Community DevelopmentQuality of Life, Municipal Infrastructure, Parks,
TYPE A TYPE A vs.vs. TYPE TYPE BBEconomic DevelopmentPrimary Job CreationInfrastructure DevelopmentManufacturingAgriculture-Related IndustryValue-Added Food ProcessingWarehousing/DistributionTechnology Development
Community DevelopmentProfessional and Armature
Sports and Athletic FacilitiesEntertainment, Tourist and
Athletic FacilitiesPublic Parks and Related
Open Space ImprovementsAffordable HousingWater Supply FacilitiesWater Conservation
ProgramsStreet and Road RepairsGeneral Municipally Owned
Improvements
Why are we not a TYPE B cont..?Why are we not a TYPE B cont..?
Cities like Quanah, Crowell, Burkburnett, do not have the financial wherewithal to adequately fund their community development needs.
TYPE B organizations fill this voidWichita Falls has both a TYPE A and TYPE B organization.
Wichita Falls collects over $6 million a year in sales taxVernon does not collect enough to successfully fund both a
TYPE A and TYPE B organizationVernon has other funding sources to meet its community
development/TYPE B needsVernon needs to continue to focus our Economic Development
Dollars on:Business RecruitmentBusiness Retention/ExpansionEntrepreneurial Development/Small Business Start-up.
What will the Ballot Measure What will the Ballot Measure Accomplish?Accomplish?
Simply stated, it will allow the BDC to begin offering assistance, be it financial or otherwise, to the businesses in Vernon that are currently exempted, by law, from receiving our assistance.RetailServiceRestaurantsEtc.
What Type of Assistance will be What Type of Assistance will be offered?offered?Financial
RLF“Lean-Retail” ReviewsBusiness Counseling ServicesAccess to all BDC Business Resources
Municipal Project FundingAquatic Center Construction, upkeep, etc.Museums Construction, upkeep, etc.Street/Sidewalk upkeep/repairPark Improvements/Development
Who will over see the programs?Who will over see the programs?
BDC StaffBDC Board of DirectorsLoan Fund Committee
Make-Up TBDLending Criteria TBD
City of Vernon Commission
What gives you the authority to request What gives you the authority to request this change?this change?
Texas Local Government Code Section §505.158 says:Type B Corporations in a community of 20,000 or less can
fund projects for Land, buildings, equipment, facilities, expenditures, targeted infrastructure, and improvements
If found by Board of Directors to promote new or expanded business development
And the expenditure does not exceed $10,000 (without receiving City Commission approval)
What gives you the authority to request What gives you the authority to request this change?this change?
Texas Local Government Code Section §504.152 says:Type B Projects can be undertaken by a Type A
Corporation IF; The city submits to the voters a ballot proposition that
authorizes a Type A Corporation to use sales and use tax proceeds for a specific Type B project or category of Type B projects. The Covered Events Center was a “Specific” Type B Project This November 8th Ballot Measure Represents a “Category” of
Type B Projects.
How are you going to pay for all this?How are you going to pay for all this?
To be certain, the BDC does not have a hidden “Slush Fund”
Current Fund Balance of ~$420,000Anticipate bringing in ~$600,000 in Sales Tax
revenue this fiscal yearAnnual Lease Revenue of $60,000Budgeted Expenditures of ~$500,000
~$235,000 for TLF Payments (Tangarie and Abundant Energy) and Mortgage Payment on 1401 Enid Street Property
$250,000 of Notes payable beginning September 12Possible Cash-Grant Matches from USDA
Rural Community Lending Programs
In Closing…In Closing…
The Business Development Corporation is here to create jobsWe have been successful with fulfilling the “Business
Attraction” portion of our economic development missionIt is now time to focus on the Retention/Expansion and
Entrepreneurial Development portions of the Economic Development Mission
This means including ALL types of businessesRetailServiceRestaurantsetc.
The passing of this Ballot measure will give us the tools necessary to continue being successful while assisting as many businesses and entrepreneurs in Vernon and Wilbarger County as possible.
