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Consultant outlines membership‑funded EDC model and revolving‑loan approach
Summary
Tom Mullins presented a membership and grant‑based economic development model used in Tyler, citing tiered fees, contracted services for the city, and federal grants that seeded revolving loan funds; he offered to share templates and advise Lago Vista on membership tiers and loan fund structures.
Tom Mullins, a consultant with long experience organizing and operating semi‑private economic development corporations, told the Lago Vista EDC that a membership‑funded approach can work for smaller cities if scaled appropriately.
Mullins described the model he implemented in Tyler, Texas: an investor‑oriented membership program with annual fees ranging from about $2,500 to $25,000 for larger employers and institutions, plus contractual arrangements to provide economic development services to the city. He said that membership revenues supported operations and helped leverage federal grants and loan funds.
“We started the economic development group with 22 members and about $150,000 in pledges,” Mullins said, describing how the organization later capitalized revolving loan funds with federal Economic Development Administration grants (he cited grants of roughly $500,000 each) and built a loan portfolio that eventually exceeded $5 million. He outlined an SBA 504‑style lending partnership (roughly a 50% SBA / 40% EDC / 10% entrepreneur structure) that helped reduce bank exposure and expand lending for fixed assets.
Mullins cautioned that creating a full‑time EDC with staff and programs typically requires several years and either a committed membership base or a dedicated local revenue source (type A or B sales tax). He recommended Lago Vista evaluate whether a scaled membership program, contracted services model, or targeted revolving fund makes sense given local capacity.
Board members asked about what members receive for fees; Mullins said the benefit is primarily community economic growth and indirect business opportunities, with some marketing or access benefits for larger tiers. He offered to provide sample documents, revolving‑loan templates and training references and suggested partnering with nearby communities and banks for underwriting expertise.
Chair Justin Lownds and other board members thanked Mullins for practical examples and said the board will follow up with staff to receive materials and explore membership and grant‑seed options.
