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Who Are We?

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Who Are We?

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  1. “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”

  2. Who Are We? • Formed in 1993 by Vote of the Citizens of Vernon, Texas • 501(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 Industry • NO 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.

  3. 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 Tax • Last year we collected $529,000 • This year we are currently on Target to Collect ~ $560,000

  4. 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

  5. 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.

  6. What do we do now? • We are a TYPE A Economic Development Organization • We 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: • Retail • Service • Restaurants • Etc.

  7. What is the Difference Between TYPE A and TYPE B Organizations? • TYPE A Organizations focus on Traditional Economic Development • DIRECT Job Creation • TYPE B Organizations Focus on Community Development • Quality of Life, Municipal Infrastructure, Parks, Street/Sidewalk Repairs, etc. • INDIRECT Job Creation

  8. TYPE A vs. TYPE B • Economic Development • Primary Job Creation • Infrastructure Development • Manufacturing • Agriculture-Related Industry • Value-Added Food Processing • Warehousing/Distribution • Technology Development • Community Development • Professional and Armature Sports and Athletic Facilities • Entertainment, Tourist and Athletic Facilities • Public Parks and Related Open Space Improvements • Affordable Housing • Water Supply Facilities • Water Conservation Programs • Street and Road Repairs • General Municipally Owned Improvements

  9. 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 void • Wichita Falls has both a TYPE A and TYPE B organization. • Wichita Falls collects over $6 million a year in sales tax • Vernon does not collect enough to successfully fund both a TYPE A and TYPE B organization • Vernon has other funding sources to meet its community development/TYPE B needs • Vernon needs to continue to focus our Economic Development Dollars on: • Business Recruitment • Business Retention/Expansion • Entrepreneurial Development/Small Business Start-up.

  10. What will the Ballot Measure 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. • Retail • Service • Restaurants • Etc.

  11. What Type of Assistance will be offered? • Financial • RLF • “Lean-Retail” Reviews • Business Counseling Services • Access to all BDC Business Resources • Technology • Staff Assistance • Temporary Office Use • Other

  12. What will NOT happen if the Ballot Measure Passes? • Tax Increase • No Sales Tax Increase • No Property Tax Increase • Municipal Project Funding • Aquatic Center Construction, upkeep, etc. • Museums Construction, upkeep, etc. • Street/Sidewalk upkeep/repair • Park Improvements/Development

  13. Who will over see the programs? • BDC Staff • BDC Board of Directors • Loan Fund Committee • Make-Up TBD • Lending Criteria TBD • City of Vernon Commission

  14. What gives you the authority to request 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)

  15. What gives you the authority to request 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.

  16. 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 ~$420,000 • Anticipate bringing in ~$600,000 in Sales Tax revenue this fiscal year • Annual Lease Revenue of $60,000 • Budgeted 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 12 • Possible Cash-Grant Matches from USDA • Rural Community Lending Programs

  17. In Closing… • The Business Development Corporation is here to create jobs • We have been successful with fulfilling the “Business Attraction” portion of our economic development mission • It is now time to focus on the Retention/Expansion and Entrepreneurial Development portions of the Economic Development Mission • This means including ALL types of businesses • Retail • Service • Restaurants • etc. • 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.

  18. The Business Development Corporation of Vernon, Texas Presented by: Sean Stockard, CEcD President/CEO October 21st, 2011

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