Nebraska’s Community Development Law gives mayors a proven TIF framework — but the procedural details and unique characteristics of Nebraska TIF create specific pitfalls to watch for. Hageman Capital works with municipal leaders across the state, and here are the missteps we see most often.
Pitfall 1: Underestimating the Blight Declaration Process
Nebraska TIF requires a substandard and blighted declaration before any redevelopment plan can be adopted. The blight study must be commissioned, submitted to the planning commission for a 30-day review, followed by a public hearing with two weeks of published notice plus mailed notice to affected associations and political subdivisions. This process takes time. Mayors who assume blight can be declared quickly risk missing the July 1 Notice to Divide Tax deadline — delaying the entire project by a year.
Pitfall 2: Missing the July 1 Deadline
The Notice to Divide Tax must be filed with the county assessor on or before July 1 of the calendar year in which the tax division becomes effective. This is a hard deadline — miss it and the taxes remain undivided for the affected year. Build this deadline into your project timeline from day one and work backward to ensure all approvals are complete in time.
Pitfall 3: Poor Communication About Taxing Body Impact
Nebraska requires mailed notice to every county, school district, community college, and political subdivision affected by the TIF plan. These entities will scrutinize the proposal. Be prepared to explain that base value taxes continue flowing as usual, only the excess value is captured, and the cost-benefit analysis demonstrates the project is in the community’s long-term interest. Proactive communication builds support before opposition forms.
Pitfall 4: Not Ensuring the CRA Is Active and Prepared
Many Nebraska cities have CRAs that exist on paper but have not been actively used. If your CRA lacks current board members, operating procedures, or staff capacity, it will slow the TIF process. Ensure your CRA is active, staffed, and ready before a developer brings a project to the table.
Tennessee’s new TIF legislation (SB 1760 / HB 1892) introduces legal instruments that materially change the risk analysis for TIF-supported projects. For municipal financial advisors responsible for evaluating bond structures and protecting the municipality’s fiscal position, this overview covers the key statutory provisions and their practical implications.
Tennessee’s TIF Framework at a Glance
TIF in Tennessee operates through Housing Authorities (up to 30-year allocation periods, blighted areas, broad eligible cost authority) and Industrial Development Boards (up to 20-year allocation periods, broader project eligibility, state approval required for private improvements beyond public infrastructure). The increment consists of the increase in property taxes above the base amount established at plan approval. Tennessee allows personal property taxes to be included in the increment for IDB projects.
TIF bonds or notes issued by a TIF agency are non-recourse — payable solely from tax increment revenues. Neither the TIF agency, the city, nor the county pledges its general credit. This has been the case under existing law, but SB 1760 strengthens the framework considerably.
Taxpayer Agreements: The Technical Details
Under SB 1760, a TIF agency can enter into a taxpayer agreement with a property owner in the plan area. The agreement creates a “taxpayer direct payment” obligation — the positive difference between the next-due debt service and the actual increment available. The taxpayer agreement lien is recorded with the register of deeds, carries first-priority status over existing and subsequent mortgages, runs with the land, and is enforceable as real property taxes. Critically, the lien is not accelerated or eliminated by foreclosure of a property tax lien, and any deed of trust provision requiring acceleration solely due to entering a taxpayer agreement is unenforceable.
Implications for Your Analysis
The taxpayer agreement structure means TIF bonds issued under this framework do not constitute municipal debt, carry no recourse to the municipality’s general credit, and are fully backstopped by a developer guarantee with the strongest lien priority available under Tennessee law. For your analysis, the key modeling inputs are the projected assessed value increase, the resulting annual increment, the debt service schedule, and the developer’s financial capacity to honor the taxpayer agreement guarantee. Coverage ratios, development timeline risk, and the methodology for calculating increment (aggregate vs. parcel-by-parcel) should all be evaluated.
Compliance and Reporting Requirements
After plan approval, the TIF agency must file parcel descriptions, resolutions, and base tax amounts with the Comptroller and each applicable tax assessor. Annual reports on tax increment revenues allocated to the TIF agency are due by October 1 each year. Taxpayer agreements must be filed and recorded with the register of deeds, including the legal description, property owner name, lien term, and the executed agreement. Written notification to the county trustee of any specific collection or enforcement requirements must be provided on or before the recording date.
Hageman Capital as a Technical Resource
Hageman Capital works alongside municipal financial advisors as a specialized TIF structuring resource. Our team has experience across multiple state legislative frameworks and understands the technical details that matter for your analysis. Connect with our team for a no-cost technical consultation.
Municipal financial advisors are the last line of defense before a TIF bond structure reaches the governing body for approval. Tennessee’s SB 1760 introduces taxpayer agreements and first-priority liens that strengthen the developer-backed TIF framework — but the technical details require careful analysis. Here are the pitfalls Hageman Capital sees financial advisors encounter most frequently, and how to avoid them.
Pitfall 1: Underestimating Development Timeline Risk in Increment Projections
Increment projections are only as reliable as the assumptions behind them. The most common modeling error is projecting increment based on a development timeline that does not account for construction delays, permitting holdups, or phased delivery. Property is not reassessed until improvements are complete, and increment does not flow until the new assessed value exceeds the base. Build conservative timing assumptions into your models and stress-test scenarios where the project delivers six to twelve months late.
Pitfall 2: Failing to Evaluate the Developer’s Financial Capacity
A taxpayer agreement is only as strong as the guarantor behind it. The developer’s commitment to cover increment shortfalls is a binding obligation, but if the developer lacks the financial resources to honor that obligation, the guarantee has limited practical value. Before recommending the structure, evaluate the developer’s balance sheet, track record, existing obligations, and the financial capacity to service the taxpayer agreement guarantee alongside their other commitments.
Pitfall 3: Not Accounting for the Increment Calculation Methodology
Tennessee’s TIF plan should specify whether the increment is calculated on an aggregate basis (all parcels combined) or a parcel-by-parcel basis. For multi-phase projects, the plan may allow allocation periods to begin at different times for different parcels. The methodology you use in your projections must match what the plan specifies — otherwise your revenue estimates may overstate or understate the actual increment available for debt service. Confirm the methodology with bond counsel before building your model.
Pitfall 4: Overlooking the IDB State Approval Requirement
If the TIF agency is an IDB and the proposed use of TIF proceeds includes private property improvements that do not qualify as public infrastructure, the Comptroller and Commissioner must approve the expenditure. If this approval is not obtained — or if the request is submitted late — the project timeline can be significantly delayed. Identify whether state approval is needed early in your analysis and factor the 30-day deemed-approval window into the project schedule.
Pitfall 5: Treating the Taxpayer Agreement as a Formality
The taxpayer agreement authorized by SB 1760 is a powerful instrument, but its effectiveness depends on the specific terms negotiated. Review the agreement for clear definitions of the taxpayer direct payment calculation, the lien recording requirements, the enforcement provisions, and the relationship between the taxpayer agreement and the redevelopment agreement. A well-drafted taxpayer agreement provides enforceable security; a boilerplate version may leave gaps that become problems later.
Hageman Capital as a Technical Partner
We work alongside municipal financial advisors as a specialized TIF resource — not to replace your analysis, but to complement it with experience structuring developer-backed TIF Bonds across multiple state frameworks. Request a meeting with Whitney Peterson, our Director – Government Relations, for a no-cost technical consultation on the deal on your desk.
Voting on a TIF resolution is one of the most consequential economic development decisions a Tennessee city council member will face. Developer-backed TIF Bonds under SB 1760 offer strong protections for your municipality, but there are common missteps that council members should be aware of before casting that vote. Hageman Capital works with municipal leaders across the state, and here are the pitfalls we encourage council members to watch for.
Pitfall 1: Voting Without Fully Understanding the Structure
TIF is a complex financial tool, and there is no shame in needing more information before you vote. The pitfall is voting yes — or no — without understanding what you are actually approving. Before the vote, make sure you understand how the increment is calculated, what the taxpayer agreement guarantees, how long the allocation period lasts, and what happens if the project underperforms. If you do not understand something, ask. It is far better to request a briefing than to vote on incomplete information.
Pitfall 2: Confusing TIF With a Tax Giveaway
The most common public misconception about TIF is that it gives away taxpayer money to developers. If you share this misconception, you will either vote against a beneficial project or be unable to defend your yes vote to constituents. TIF does not redirect existing tax revenue. It captures only the new increment — revenue that would not exist without the project. The base amount continues flowing to all taxing jurisdictions. Under developer-backed structures, the municipality carries zero credit risk. Being able to articulate this clearly is essential to your role.
Pitfall 3: Not Reviewing the Taxpayer Agreement Terms
SB 1760 authorizes taxpayer agreements, but the strength of those agreements depends on the specific terms negotiated. As a council member, you should review (or have your financial advisor review) the shortfall guarantee provisions, the lien terms, the enforcement mechanisms, and the developer’s financial capacity to honor the guarantee. A taxpayer agreement that looks good on paper but lacks enforcement teeth does not protect your community.
Pitfall 4: Ignoring Constituent Communication Until It Is Too Late
Public hearings are a statutory requirement, but they should not be the first time your constituents hear about a TIF project. Proactive communication — explaining what TIF is, how it works, and why the specific project benefits the community — builds public support before opposition has a chance to form around misconceptions. Prepare talking points before the hearing, not after.
Pitfall 5: Assuming Someone Else Will Do the Oversight
Once a TIF plan is approved, your oversight role does not end. Annual reporting, construction milestone tracking, and compliance with the redevelopment agreement are ongoing responsibilities. Make sure the TIF agency has systems in place for monitoring and that the governing body receives regular updates on project status and increment performance.
Get the Clarity You Need
Hageman Capital provides free TIF education to Tennessee council members. Our goal is to make sure you have the understanding and confidence to cast an informed vote — and to explain that vote to the people who elected you. Request a meeting with Whitney Peterson, our Director – Government Relations, and get your questions answered before the next resolution hits the agenda.
Economic Development Directors in Tennessee are the professionals who source deals, structure incentives, and shepherd projects to completion. With SB 1760 introducing developer-backed TIF Bonds with taxpayer agreements, you have a powerful new tool — but deploying it effectively requires avoiding several common missteps. Hageman Capital works alongside ED Directors across the state, and here are the pitfalls we see most often.
Pitfall 1: Recommending TIF Without a Thorough Feasibility Analysis
The “but-for” test is both a legal requirement and a credibility check. If you recommend TIF for a project that would have proceeded without it, you undermine your position with the governing body and waste incentive capacity on a deal that did not need it. Before recommending TIF, verify the developer’s proforma, confirm the funding gap, and ensure the projected increment can support the proposed bond. An independent feasibility analysis protects both your recommendation and your credibility.
Pitfall 2: Choosing the Wrong TIF Agency Structure
Selecting between a Housing Authority and an IDB has downstream consequences for eligible costs, allocation period, and approval requirements. An IDB may seem simpler, but if the project involves significant private property improvements, you will need state approval from the Comptroller and Commissioner — which adds time. A Housing Authority offers broader cost authority and longer terms but requires a blight determination. Matching the agency to the project’s specific needs early prevents costly course corrections later.
Pitfall 3: Letting Developers Dictate Terms Without Pushback
Your job is to attract investment and close deals — but not at any cost. The redevelopment agreement is the central contract, and it is where you negotiate the protections that keep the deal fair for the municipality. Insist on enforceable construction timelines, clear eligible cost caps, strong taxpayer agreement shortfall guarantees, financial reporting obligations, and meaningful default remedies. A developer who resists reasonable protections may not be the right partner for a publicly supported project.
Pitfall 4: Failing to Prepare the Governing Body
Even a well-structured deal can fail at the council vote if elected officials are surprised by the details. Brief your mayor and council members before the public hearing — not after. Provide clear materials explaining the TIF structure, the risk protections, the projected community benefits, and the answers to the questions constituents will ask. Your role is not just to structure the deal, but to ensure the decision-makers understand and support it.
Pitfall 5: Not Having a Capital Partner Identified Early
A developer-backed TIF Bond only delivers upfront capital if there is a buyer for the bond. Identifying a capital provider like Hageman Capital early in the process gives the developer certainty, strengthens the lender’s confidence, and helps you present a complete deal to the governing body. Waiting until after approvals to figure out the capital side introduces unnecessary risk and delay.
Tennessee’s new developer-backed TIF Bond framework is a powerful tool — but like any complex financial instrument, the details matter. For mayors championing TIF-supported development in their communities, there are common missteps that can undermine a project’s success, erode public trust, or leave value on the table. Hageman Capital works with municipal leaders across Tennessee to help navigate these challenges, and we have seen the same patterns repeat. Here are the pitfalls worth watching for — and how to avoid them.
Pitfall 1: Approving a Project Without a Clear “But-For” Justification
Tennessee’s TIF framework requires that the project would not be economically feasible without TIF assistance. This is not a formality — it is the legal and political foundation of the entire transaction. If a project would have proceeded anyway, using TIF is giving away future tax revenue unnecessarily. Mayors should insist on a genuine feasibility analysis that demonstrates the funding gap and confirms TIF is the tool that closes it. If the developer cannot articulate why the project fails without TIF, the incentive may not be warranted.
Pitfall 2: Not Understanding the Difference Between Housing Authority and IDB Structures
Choosing the wrong TIF agency can limit your project’s flexibility or introduce unnecessary approval requirements. Housing Authorities offer 30-year allocation periods and broader eligible cost authority for blighted areas, but require a blight determination. IDBs offer 20-year periods and do not require blight, but need state approval for private property improvements. A mayor who does not understand this distinction may inadvertently delay a project or miss out on a more favorable structure. Working with experienced TIF advisors early in the process prevents this.
Pitfall 3: Failing to Negotiate Strong Taxpayer Agreement Terms
SB 1760 authorizes taxpayer agreements, but the legislation does not dictate every term — many details are negotiated in the redevelopment agreement. Mayors should ensure the taxpayer agreement includes clear shortfall guarantee provisions, enforceable performance milestones, financial reporting requirements, and meaningful remedies for default. A weak taxpayer agreement undermines the protections the legislation was designed to provide.
Pitfall 4: Poor Public Communication
TIF is often misunderstood by the public. Constituents may believe TIF diverts existing tax revenue from schools and services, or that it amounts to a handout to developers. Neither is accurate, but if you cannot explain TIF clearly at a town hall, you will face opposition based on misconceptions rather than facts. The key messages are simple: TIF does not create new taxes, does not redirect existing revenue, and under the developer-backed structure, the city carries zero financial risk. Preparing clear talking points before the public hearing is essential.
Pitfall 5: Going It Alone Without Expert Support
Tennessee’s TIF legislation is new, and the taxpayer agreement framework adds legal and financial complexity that most municipal staff have not encountered before. Mayors who try to navigate the process without experienced partners risk structural errors, missed deadlines, or terms that do not adequately protect the municipality. This does not mean you need to hire expensive consultants — Hageman Capital provides TIF structuring expertise to Tennessee mayors at no cost. We work alongside your existing financial advisors, legal counsel, and economic development staff to ensure the structure is right.
Start the Conversation
If you are evaluating a TIF opportunity or simply want to understand how the new legislation applies to your city, Hageman Capital is here to help. Our Director – Government Relations, Whitney Peterson, works directly with mayors across Tennessee to provide education, structuring guidance, and deal support at no charge. Request a meeting with Whitney Peterson and make sure your community’s next TIF project is structured right from day one.
As a city council member in Tennessee, you may soon be asked to vote on a TIF-supported development project — and that vote will carry weight with your constituents, your fellow council members, and the local media. Tennessee’s new TIF legislation (SB 1760 / HB 1892) has introduced developer-backed TIF Bonds with protections that make the structure far more favorable for municipalities than traditional approaches. Here is a high-level overview to help you prepare.
TIF in Plain Language
Tax Increment Financing does not spend public money, create new taxes, or raise existing tax rates. It captures only the increase in property taxes that a new development project generates — revenue that would not exist without the project. The base amount of property taxes your city was collecting before the development continues flowing to all taxing jurisdictions as usual. Only the new growth, the increment, is set aside for a limited period (up to 20 or 30 years depending on the TIF agency) to help pay for eligible project costs.
When the TIF period ends, all revenue — including the increment — flows permanently to the city, county, schools, and other taxing bodies. The net result is a larger tax base generating more revenue than your community had before the project was built.
What SB 1760 Means for Risk
The new legislation authorizes taxpayer agreements — binding contracts where the developer guarantees bond repayment. If the increment falls short, the developer covers the difference. The lien created by this agreement carries the same priority as property tax liens and takes precedence over any mortgage on the property. The municipality issues the bond as a conduit — with no obligation to advance funds from the general fund. No public debt is created. No municipal credit is pledged.
What You Are Actually Voting On
When a TIF resolution comes before your council, you are voting to approve either an economic impact plan (for IDB projects) or a redevelopment plan (for Housing Authority projects). Tennessee law allows this approval by resolution at a single reading. Before that vote, you should have access to the TIF plan document identifying the project boundaries, projected increment, proposed allocation period, eligible costs, and estimated impact on all affected taxing agencies. The developer’s taxpayer agreement and redevelopment agreement terms should also be part of the record.
Your job is to evaluate whether the project genuinely benefits your community, whether the safeguards protect the public interest, and whether you can explain your vote clearly to constituents who ask. Developer-backed TIF Bonds make that explanation straightforward: the developer pays, the community benefits, and the city holds no debt.
Free Educational Support
Hageman Capital provides free TIF education to Tennessee council members. Whether you want a walkthrough of the legislation, help preparing constituent talking points, or simply want to ask questions before your next vote, our team is available. Connect with Whitney Peterson, our Director – Government Relations, for a no-obligation conversation.
Tennessee’s passage of SB 1760 and HB 1892 has added a significant new capability to the state’s TIF toolkit. For Economic Development Directors managing active developer pipelines, this legislation means you now have a deal-structuring mechanism that competing states are still catching up to. Here is an overview of the framework and how it fits into your work.
TIF in Tennessee: The Framework
Tax Increment Financing in Tennessee operates through two primary agency types. Housing Authorities can allocate increment for up to 30 years and focus on redevelopment of blighted areas. Industrial Development Boards can allocate increment for up to 20 years and have broader project authority, though state approval is required for private property improvements beyond public infrastructure. Both can issue TIF bonds or notes to developers, who then assign those instruments to capital providers in exchange for upfront construction capital.
The increment itself consists of the increase in property taxes above the base amount established when the TIF plan is approved. No existing revenue is redirected — only the new growth generated by the project is captured. When the allocation period ends, all revenue flows back to the taxing jurisdictions permanently.
What SB 1760 Adds to Your Toolkit
The new legislation introduces taxpayer agreements — voluntary, binding contracts where the developer guarantees any shortfall between actual increment and required debt service. The taxpayer agreement lien is recorded with the register of deeds, runs with the land, carries first-priority status over mortgages, and is enforceable as property taxes. For ED Directors, this changes the conversation with developers and lenders alike: the municipality’s credit is completely off the table, and the security structure is stronger than traditional TIF bonds.
How This Helps You Close Deals
When a developer evaluates incentive packages across competing cities, certainty of capital is a major factor. Developer-backed TIF Bonds with taxpayer agreements offer that certainty. The developer can sell the bond to a capital provider like Hageman Capital and receive upfront cash — rather than waiting years for increment to accumulate. For your pipeline, this means you can offer an incentive that is financially compelling to the developer, defensible to your governing body, and carries zero municipal credit exposure. That is a combination few other incentive tools can match.
Choosing Between Housing Authority and IDB
One of the first decisions in any Tennessee TIF transaction is which agency to use. Housing Authorities offer longer allocation periods and broader eligible cost categories for blighted areas, but require a blight determination. IDBs offer more flexibility on project types and do not require blight findings, but have shorter allocation periods and need state approval for private property expenditures. The choice depends on the project’s location, the nature of the costs, and whether the additional time or eligible cost flexibility of a Housing Authority structure adds value.
Hageman Capital as Your TIF Resource
Hageman Capital works alongside ED Directors as a free TIF structuring resource — helping you evaluate project feasibility, navigate the IDB vs. Housing Authority decision, and structure developer-backed TIF Bonds that move deals from conversation to groundbreaking. Connect with Whitney Peterson and let’s discuss your pipeline.
If you are a Tennessee mayor who has heard the term “developer-backed TIF Bond” but has not yet had the chance to explore what it means for your community, this overview is for you. SB 1760, signed into law during the 2026 legislative session, introduced new tools that make Tax Increment Financing one of the most powerful and lowest-risk economic development instruments available to your city. Here is what you need to know at a high level.
What TIF Is and What It Is Not
Tax Increment Financing captures the increase in property tax revenue generated by a new development project and directs that increase toward paying for eligible project costs. It does not create new taxes. It does not raise anyone’s tax rate. The base amount of property taxes — everything your city and county were collecting before the project — continues flowing to all taxing jurisdictions as usual. Only the increment, the growth that would not exist without the development, is set aside for a limited period to support the project.
When the TIF period ends (up to 20 years for IDB projects or 30 years for Housing Authority projects), all tax revenue — including what was the increment — flows back to the taxing jurisdictions permanently. The result is a larger tax base generating more revenue for your city, schools, and county than existed before the project was built.
What Changed With SB 1760
The new legislation authorizes taxpayer agreements — binding contracts where the developer guarantees repayment of TIF bond debt. If the actual tax increment falls short of what is needed to cover the bond payment, the developer makes up the difference. The taxpayer agreement lien runs with the land, carries first-priority status over any mortgage, and is enforceable as real property taxes. This means the municipality bears zero financial risk on the bond — the developer is contractually and legally on the hook.
What This Means for Your Role as Mayor
As mayor, you are the public face of economic development in your community. Your role in TIF is to champion projects that serve the community’s interests, work with your economic development team to evaluate proposals, and ensure the governing body has the information needed to make sound decisions. You are not expected to be a TIF expert — that is what professional advisors and resources like Hageman Capital are for.
What you should be able to communicate to your council and constituents is straightforward: TIF does not spend public money, does not redirect existing tax revenue, and under the new taxpayer agreement structure, does not put the city’s credit at risk. It is a tool that turns developer investment into long-term community growth — more jobs, more tax revenue, and better infrastructure.
Getting Started
Hageman Capital provides free TIF education and structuring guidance to Tennessee mayors. Whether you have a specific project in mind or simply want to understand the landscape before a developer comes knocking, our team is available to help. Connect with Whitney Peterson, our Director – Government Relations, to schedule a no-cost consultation and start exploring what developer-backed TIF Bonds can do for your city.
When Tennessee municipal leaders consider using Tax Increment Financing to support a development project, one of the most consequential decisions they face is how the TIF Bond will be structured. The two primary options — municipal-backed and developer-backed — carry fundamentally different risk profiles for your city. With the passage of SB 1760 and HB 1892, Tennessee has created a legal framework that makes developer-backed TIF Bonds not just viable, but preferable for most transactions. Here is why.
Municipal-Backed TIF: What It Means for Your City
In a municipal-backed TIF structure, the municipality or its TIF agency issues bonds that may be supported — in whole or in part — by the municipality’s credit, general revenues, or taxing power. If the tax increment generated by the development falls short of the required debt service, the municipality may bear some financial responsibility for covering the gap. The bonds may count against statutory debt limitations, and the municipality’s bond rating could be affected.
Municipal-backed bonds can offer lower interest rates because the lender has the security of the municipality’s credit behind the obligation. In some cases, this structure may be appropriate — particularly for large-scale public infrastructure projects where the municipality is the primary beneficiary and the increment is well-supported by existing development trends. But for individual commercial real estate projects driven by a private developer, pledging municipal credit introduces risk that is unnecessary under Tennessee’s updated TIF framework.
Developer-Backed TIF: Risk Where It Belongs
In a developer-backed TIF structure, the TIF agency issues the bond to the developer, who assigns it to a capital provider in exchange for upfront cash. The bond is repaid solely from the tax increment, and the developer — through a taxpayer agreement under SB 1760 — contractually guarantees any shortfall. The municipality serves as a conduit issuer with no obligation to advance funds, levy additional taxes, or pledge its general credit.
The taxpayer agreement lien runs with the land, carries the same priority as property tax liens, and takes precedence over any existing or subsequent mortgage. Delinquent taxpayer direct payments are enforceable as real property taxes. This means the developer’s guarantee is not just a contractual promise — it is backed by the strongest collection mechanism available under Tennessee law.
The Developer Gets the Same Proceeds Either Way
A common misconception is that developer-backed bonds reduce the capital a developer receives compared to a municipal-backed structure. This is not the case. The TIF Bond’s value is determined by the projected tax increment — the increase in property taxes generated by the completed development. Whether the bond is municipal-backed or developer-backed, the underlying revenue stream is the same. What changes is who bears the risk if that revenue stream falls short.
When a developer sells a developer-backed TIF Bond to Hageman Capital, they receive upfront cash based on the projected increment and the strength of the taxpayer agreement guarantee. The developer gets the capital they need for construction. The municipality gets a completed project that generates long-term tax base growth. And neither party has pledged anything they cannot afford to lose — the developer’s guarantee is tied to the property they are developing, and the municipality’s general fund remains untouched.
When to Choose Developer-Backed
For most individual commercial real estate projects in Tennessee — multifamily developments, mixed-use projects, retail centers, office buildings, and industrial facilities — developer-backed TIF Bonds are the appropriate structure. The developer is the party that benefits most directly from the TIF assistance, the developer has the financial incentive to complete the project and generate the increment, and the developer is best positioned to bear the risk of underperformance.
Municipal-backed structures may still make sense in limited circumstances — large public infrastructure projects, area-wide TIF districts supporting multiple developments, or situations where the municipality has strong budgetary reasons to issue general obligation bonds. But for the single-site, developer-driven projects that make up the majority of TIF transactions, developer-backed is the structure that protects the public interest while delivering the same economic development outcomes.
Hageman Capital Makes Developer-Backed TIF Work
The developer-backed structure works because there is a capital provider willing to purchase the bond. Hageman Capital is that capital provider. We purchase developer-backed TIF Bonds across multiple states, and we work with municipal leaders at no cost to help them understand the difference between these structures and evaluate which approach best fits their community’s needs. Connect with our team and let’s make the right call for your municipality.
