Texas Leverage Fund: $14.3 Million Available for Loans in the Heart of Texas

In a previous post, we noted that the Texas Leverage Fund makes loans to 4A- or 4B-taxing Economic Development Corporations. These loans basically advance the EDC its future sales tax revenues, and can be spent just as their sales tax revenues can be spent.

The Heart of Texas Region cities have a combined $14.3 million in loan availability, and interest rates are currently just over 3%.

Individual cities vary in their lending limits. Cities with over $1 million available are Mexia, Bellmead, Fairfield, and Hillsboro. Cities with between $500,000 and $1 million are McGregor, Clifton, and Groesbeck. Cities with between $100,000 and $500,000 are Hubbard, Itasca, Meridian, Rosebud, and Wortham. Cities with between $50,000 and $100,000 are Lott and Crawford.

For more information on how to access this fund, email Megan or Kathy or visit the Texas Economic Development Bank, part of the Governor's Office of Economic Development and Tourism.

Economic Development Financing Tool: Texas Leverage Fund

Staff is excited to learn about an economic development financing tool that 4A and 4B corporations can use. It's basically a loan from the State to do a project, and any project that would be eligible for your regular 4A or 4B sales tax would be eligible for this funding.

Two things are great about this money: first, it has a very low interest rate (about 3.25% as of this writing,) and second, it is securitized by your future revenue - so you don't have to pledge assets to secure the loan. This is good if you don't have any assets, but it's good even if you do: not having to tie up your assets means they're free to use for future projects.

Look for future posts, when we'll share more information about communities' borrowing abilities under this program, and Happy Independence Day!