frequently asked questions - amarillo economic development corporation

FREQUENTLY ASKED QUESTIONS

Q: WHAT IS AN ECONOMIC DEVELOPMENT CORPORATION (EDC)?

Q: WHAT IS AN ECONOMIC DEVELOPMENT CORPORATION (EDC)?

A: Texas state law authorizes communities to set an economic development sales tax rate and to establish an EDC to spend that

tax revenue to expand and grow a community. EDCs are established through a public vote.

Q: HOW IS AN EDC FORMED?

A: EDCs are voted on by community residents. In Amarillo, the EDC is city-chartered and governed by a city-appointed board of

directors who oversees decisions regarding the EDC’s use of funds and projects. The board of directors is not paid, but it can be

reimbursed for expenses. The city council has the final say for the EDC’s programs, investments

and expenditures.

Q: HOW IS AN EDC FORMED?

Q: WHEN WAS THE AMARILLO EDC ESTABLISHED?

Q: WHEN WAS THE AMARILLO EDC ESTABLISHED?

A: In 1990, Amarillo approved the formation of an EDC, becoming the second Texas city to do so after lawmakers passed legislation to authorize the EDCs in 1989. Amarillo voters that year approved

a half-cent sales tax to fund economic development.

Q: WHO IS IN CHARGE OF THE AMARILLO EDC?

A: The city council must appoint a five-member board of directors to serve terms of no more than six years. The AEDC board

members just serve three-year terms, but may be reappointed to serve an additional three-year term. State law does not enforce

residency restrictions for Type A board members.

Q: WHO IS IN CHARGE OF THE AMARILLO EDC?

Q: HOW IS AN EDC FUNDED?

A: Most EDCs are funded by sales tax revenue. Some also receive private funding from local corporations or organizations. The

Amarillo EDC is supported by a half-cent sales tax that is budgeted directly to the organization.

Q: HOW IS AN EDC FUNDED?

Q: HOW MUCH CAN A CITY CHARGE FOR SALES TAX?

A: According to state laws, the sales tax cap for local governments is

2 cents per every dollar spent. The State of Texas tax rate is 6.25%.

Q: HOW MUCH CAN A CITY CHARGE FOR SALES TAX?

Q: HOW MUCH ARE WE PAYING IN SALES TAX TO FUND

THE AMARILLO EDC?

A: The local sales tax in Amarillo is 2 cents for every dollar spent. The AEDC receives half a cent of that

local sales tax for every dollar spent.

Q: HOW MUCH ARE WE PAYING IN SALES TAX TO FUND

THE AMARILLO EDC?

Q: WHO IS THE AMARILLO EDC AUTHORIZED TO SUPPORT?

A: PRIMARY BUSINESSES

Q: WHO IS THE AMARILLO EDC AUTHORIZED TO SUPPORT?

Q: WHAT IS A PRIMARY BUSINESS/JOB?

A: A primary business is one where the majority of its products and services are exported outside of the local community. A

primary business brings outside dollars into the local economy.

Q: WHAT IS A PRIMARY BUSINESS/JOB?

Q: HOW DOES AN EDC EXPAND AND GROW A COMMUNITY?

A: An EDC uses the revenue generated from the approved sales tax rate to attract and retain primary businesses, create new jobs

and, as a result, generate wealth for a community and its residents.

Q: HOW DOES AN EDC EXPAND AND GROW A COMMUNITY?

Q: HOW DOES THE AMARILLO EDC SUPPORT LOCAL BUSINESSES?

A: The Amarillo EDC DOES support local businesses. While the EDC is not authorized to financially invest in local businesses, it supports them by bringing outside dollars into the community.

New businesses support local vendors, while employees use their salaries to support local businesses

as well.

Q: HOW DOES THE AMARILLO EDC SUPPORT LOCAL BUSINESSES?

Q: HOW DOES THE AMARILLO EDC SUPPORT LOCAL BUSINESSES?

A: One of the primary programs of the Amarillo EDC is the business retention and expansion program that assists primary

businesses already in operation in the Amarillo area. This program focuses on supporting those companies so they can remain in and

expand in Amarillo. The Amarillo EDC provides $500,000 in annual funding to the

WTAMU EnterPrize Challenge as well as funding support to the Amarillo Chamber of Commerce.

Q: HOW DOES THE AMARILLO EDC SUPPORT LOCAL BUSINESSES?

Q: WHY SHOULD THE LOCAL COMMUNITY CARE ABOUT “OUTSIDE DOLLARS?”

A: Outside dollars are essential to community growth and development. Outside dollars:● Increase wages● Create more jobs● Attract new residents and families to the community● Attract more businesses to the community

Q: WHY SHOULD THE LOCAL COMMUNITY CARE ABOUT “OUTSIDE DOLLARS?”

Q: HOW DOES AN EDC EXPAND THE TAX BASE?

A: When the local economy grows, when jobs are added and more people come into the community, the tax base increases. This

means that the taxes collected from expenditures increase and go right back into the city and counties. This money can be used to support schools, infrastructure, roads, recreational facilities and

more.

Q: HOW DOES AN EDC EXPAND THE TAX BASE?

Q: WHY IS A DIVERSIFIED ECONOMY IMPORTANT?

A: Think of Midland, Texas, during an oil crash. Or talk to a farmer when commodity prices on wheat or cattle have tanked. Ask

Detroit about the auto industry.

You can't put all of your “economic eggs” in one basket. You wouldn't bet your entire retirement on one stock, so why bet your city's entire

economy on one industry?

Q: WHY IS A DIVERSIFIED ECONOMY IMPORTANT?

Q: WHY ISN’T AMARILLO GROWING FASTER?

A: Amarillo IS growing fast! However, the biggest barrier to growth is workforce/talent, just like it is in many cities. Amarillo companies would expand faster if we could recruit top talent to the community.

The Amarillo community and businesses need to work collaboratively to reinvest in the community and develop a focused effort on recruiting and/or retaining top talent to the area.

Q: WHY ISN’T AMARILLO GROWING FASTER?

Q: WHAT CAN AMARILLO DO TO ATTRACT AND RETAIN TALENT?

A: The goal of the Amarillo EDC is to attract and retain businesses that make Amarillo an even better place to live. The more our city grows, the more attractive it is to current residents and students, making them more likely to stay in the area. A strong, diverse city also encourages people to move to Amarillo, which in turn, further expands our city and opens it up to more opportunity, such as large retail stores, nationally known restaurants, entertainment venues and more.

Q: WHAT CAN AMARILLO DO TO ATTRACT AND RETAIN TALENT?

Q: WHAT CAN AMARILLO DO TO ATTRACT AND RETAIN TALENT?

A: West Texas A&M University is a huge asset to the community with great students graduating every year. We need to do what we can to invest in the school so that it can develop advanced

programs of study. Additionally, we must encourage local businesses to hire these students before they

move away.

Q: WHAT CAN AMARILLO DO TO ATTRACT AND RETAIN TALENT?

Q: HOW DOES THE AMARILLO EDC SUPPORT LOCAL BUSINESSES?

A: The Amarillo EDC funds one of the largest small business/business plan competitions not just in Texas, but in the country with the annual EnterPrize Challenge. These companies are required to stay in Amarillo and they are also required to be primary businesses. These business then, in turn, help support

other local businesses when they work with local vendors/suppliers.

Q: HOW DOES THE AMARILLO EDC SUPPORT LOCAL BUSINESSES?

Q: HOW DOES THE AMARILLO EDC SUPPORT LOCAL BUSINESSES?

A: Primary businesses directly drive business to local retail businesses by making a “ripple effect.”

For example, the EDC uses sales tax revenue to attract and develop a food processing plant in Amarillo. That food processing plant creates construction jobs, landscaping jobs, safety jobs,

management jobs and more for community members, but also brings in new residents searching for jobs. Employees will have money to spend within the community. They will buy and build houses, purchase groceries, go out to eat at local restaurants with their families,

grab coffee at local coffee houses with their friends, etc. Their spending supports local businesses and increases the overall tax base.

Q: HOW DOES THE AMARILLO EDC SUPPORT LOCAL BUSINESSES?

To connect with the Amarillo Economic Development Corporation and to stay in the know on exciting

community happenings, please visit www.AmarilloEDC.com.