Financing
Texas Leverage Fund
The Texas Leverage Fund (TLF) provides a source of financing to communities that have adopted an economic development sales tax. Communities may leverage future sales tax revenues to expand economic development through business expansions, business recruitment, and exporting.
Benefit
- Available for interim, long-term, or gap financing, TLF loans provide flexible financing terms to match the unique needs of communities.
- Maturities of up to 15 years available.
- Low-cost loans provide capital to communities at floating Prime Rate, as published in the Wall Street Journal, plus 3.0%.
- TLF loans vary from $25,000 to $5 million.
Eligibility
- Generally, economic development corporations are eligible to borrow up to $6 million.
- Future sales tax revenues serve as collateral for loan repayment with required debt service coverage ratios specified in the Texas Leverage Fund Program Guidelines. Pledged tax collections not needed for actual debt service are available for other projects.
- Loan proceeds must be used to pay eligible "costs" of "projects" as defined by the Development Corporation Act of 1979, as amended. Under the Act, examples of eligible projects include land, buildings, machinery and equipment for manufacturing and industrial operations as well as sports, athletic, entertainment and public park purposes and events.
Apply
An application must be submitted to the Texas Economic Development Bank. Download the application form here.
Administration
The Texas Leverage Fund program is administered through the Office of the Governor, Economic Development Bank.
For Bank contact information, click here.
