If you serve on a city council in Mississippi, there is a good chance someone — a mayor, an economic development director, or a commercial real estate developer — is going to put a TIF proposal on your desk soon. When that happens, your job is straightforward but high-stakes: understand what you are voting on, decide whether it benefits your community, and be prepared to explain that vote to the people who elected you.
Mississippi’s updated TIF legislation, Senate Bill 2846, gives your municipality a new and more favorable way to structure TIF incentives. The key change is that TIF Bonds can now be backed by the developer rather than by the municipality. That single structural shift changes the risk equation for your city — and it is worth understanding before you cast your vote.
A Quick Refresher: How TIF Works
Tax Increment Financing does not create a new tax or raise anyone’s tax rate. It captures the increase in property tax revenue that a new development generates — the “increment” — and uses that increase to help pay for costs associated with making the project happen.
Before a development project breaks ground, the land in the project area produces a certain amount of property tax revenue each year. That amount is called the original assessed value, and it continues flowing to the city, county, school district, and other taxing bodies as usual.
Nothing about those existing revenues changes. After the project is built, the property is worth more, so property taxes go up. The difference between the new, higher amount and the original assessed value is the increment. Under TIF, that increment is set aside and used to repay the eligible costs of the development over a defined period of up to 30 years. When the TIF period ends, all tax revenue — including what had been the increment — flows back to every taxing jurisdiction at the full, higher amount.
In short, TIF lets your city use the future tax growth a project creates to help make that project possible in the first place, without touching your existing tax base.
What Changes with Developer-Backed TIF Bonds
Historically, many TIF structures have relied on municipal credit to back the bonds issued for a project. That means the municipality assumes some degree of financial exposure if the project underperforms. For council members, that creates a legitimate concern: what happens if the development does not generate enough increment to cover the bond payments?
Under SB 2846, Mississippi municipalities can now structure TIF Bonds as developer-backed obligations. Here is what that means in practice:
The municipality issues a TIF Bond to the developer. The developer then assigns — essentially sells — that bond to a capital provider like Hageman Capital, receiving upfront cash to fund the project’s development costs. The bond is repaid over time solely from the incremental property taxes the completed project generates. Critically, the bond does not constitute a general obligation or debt of the municipality. Your city’s general credit and taxing power are not pledged. The municipality is not on the hook if the increment falls short.
SB 2846 also authorizes voluntary “taxpayer agreements” between the municipality and the developer. These agreements create a contractual obligation for the developer to make up any shortfall in increment revenue. The legislation is explicit: these agreements do not constitute a tax, a fee, or municipal indebtedness, and they do not count against any constitutional or statutory debt limits. A taxpayer agreement can even be secured by a lien on the developer’s real property, giving the arrangement additional enforceability.
This is a fundamental shift. The financial risk moves from taxpayers and the municipality to the developer and the project itself.
Why This Matters for Your Vote
As a council member, every vote on a major development project carries weight. Constituents may question whether you are approving a handout to a private developer. They may worry about the impact on schools or other taxing bodies. Developer-backed TIF Bonds address those concerns directly.
First, existing tax revenues are not affected. The original assessed value continues to flow to every taxing jurisdiction, including school districts, throughout the life of the TIF. Only the new, incremental revenue generated by the development is captured — revenue that would not exist without the project.
Second, the municipality carries no debt obligation. Because developer-backed TIF Bonds are not general obligations, they do not appear on your city’s balance sheet, do not affect your bond rating, and do not count against any debt limits.
Third, the developer bears the performance risk. If the project does not generate sufficient increment, the taxpayer agreement requires the developer — not the city — to cover the gap. Your constituents are protected.
What Council Members Should Ask
When a TIF proposal comes before you, there are a few questions worth raising to ensure the deal is structured well. Does the project genuinely need TIF to be viable? What is the projected increment, and does it cover the bond payments with a reasonable cushion? Has the redevelopment plan been reviewed by qualified financial and legal advisors? Does the taxpayer agreement include sufficient protections for the municipality? And what public benefits — jobs, infrastructure, expanded tax base — will the completed project deliver to your community?
These are not questions designed to slow a deal down. They are questions that make you a better steward of public resources and give you the language to explain your vote with confidence.
A Resource, Not a Sales Pitch
Hageman Capital works with municipalities across the country to help local leaders understand how developer-backed TIF Bonds work and how to structure them in a way that protects the public interest. We are not asking you to approve anything. We are offering the legal, financial, and real estate expertise to make sure that when a TIF proposal does land on your desk, you have the clarity to evaluate it on its merits.
If you would like to learn more about how TIF Bond structuring works in Mississippi under SB 2846, Hageman Capital is here as a resource. Reach out to start the conversation.
As a City Council Member in Mississippi, you’ll soon face a vote that carries real weight — approving a developer-backed TIF Bond under the state’s new legislation, Senate Bill 2846. TIF is a powerful tool for community growth, but only when the details are right. The good news is you don’t need a finance degree to cast an informed vote. You need the right questions, the right framework, and the right resource in your corner. That’s where Hageman Capital comes in. We work with municipal leaders across the country as a free expert resource on TIF Bond structuring — helping bridge the gap between what developers need and what your community deserves. Here are the most common pitfalls we see council members walk into, and how to avoid every one of them.
Pitfall #1 — Confusing Developer-Backed TIF Bonds With Municipal Debt
The single most common misconception we encounter is council members assuming that approving a TIF Bond means their city is taking on debt. Under SB 2846, that’s simply not the case. Developer-backed TIF Bonds are repaid solely from the incremental property tax revenue generated by the specific development project — not from the city’s general fund, and not from existing tax revenue. The developer, not the municipality, carries the financial obligation. The law is explicit: these bonds do not constitute public debt, do not count against statutory or constitutional debt limits, and do not pledge your city’s credit or taxing power. If a constituent asks whether you just voted to put the city on the hook for a private project, the answer is a clear and defensible no. Hageman Capital helps council members understand this distinction inside and out, so you can explain it confidently at any public meeting or town hall.
Pitfall #2 — Voting Without Understanding What Happens if the Project Underperforms
One of the most important questions a council member can ask is: what happens if the development doesn’t generate enough tax increment to cover the bond payments? Under Mississippi’s previous TIF framework, that question was harder to answer. SB 2846 changes the equation by authorizing voluntary taxpayer agreements — contractual obligations that require the developer to make up the shortfall if the increment falls short. These agreements can also be secured by a lien on the developer’s real property, with the same enforcement priority as ad valorem tax liens. In plain terms, the developer has skin in the game at every stage. Hageman Capital can walk your team through exactly how these taxpayer agreements are structured and what protections they provide, so you’re never voting on a deal without knowing who bears the risk.
Pitfall #3 — Assuming TIF Diverts Revenue From Schools and Other Taxing Bodies
This concern comes up in nearly every council chamber, and it’s understandable. Constituents want to know: is this TIF going to take money away from our schools? The answer, when a TIF Bond is structured correctly, is no. TIF captures only the increment — the new tax revenue that would not exist without the development project. The original assessed value, and every dollar of tax revenue it generates, continues flowing to every taxing jurisdiction exactly as it does today. Schools, the county, utilities — none of them lose a single dollar of their current funding. They gain a dollar of new funding once the TIF period ends and the full assessed value flows back to all jurisdictions. Hageman Capital provides council members with clear, jargon-free explanations of how the increment works, giving you ready-made talking points to address constituent concerns head-on.
Pitfall #4 — Not Asking the Right Questions During the Public Hearing
Mississippi law requires a public hearing before any TIF plan is approved. This is your opportunity — and your responsibility — to ask questions on the record. But too many council members stay quiet because they’re unsure what to ask. Here’s what Hageman Capital recommends every council member focus on: Does this project genuinely need TIF to be viable? What are the projected increment revenues, and are they based on conservative assumptions? What safeguards exist if the project timeline slips? Is the dedication requirement being waived, and if so, has the governing body made the required best-interest finding? What is the maximum term and total cost to the increment fund? These aren’t gotcha questions — they’re the questions that demonstrate diligence, build public trust, and ensure you’re casting an informed vote. We help council members prepare for these moments so there are no surprises.
Pitfall #5 — Going It Alone When Expert Help Is Free
Perhaps the biggest pitfall of all is thinking you have to navigate TIF on your own. TIF Bond structuring sits at the intersection of municipal law, real estate development, and public finance — three areas that rarely overlap in a council member’s day-to-day responsibilities. Hageman Capital exists specifically to fill that gap. We serve as a free resource to Mississippi municipalities, providing education on how developer-backed TIF Bonds work under SB 2846, helping evaluate whether a proposed project is well-structured, and ensuring that both the municipality’s interests and the developer’s needs are met. We bring the legal and real estate expertise so you can focus on what you were elected to do: represent your district and make the best decision for your community.
Start the Conversation — Request a Meeting With Our Team
If you’re a Mississippi City Council Member preparing for a TIF vote — or simply want to understand how developer-backed TIF Bonds work before one hits your agenda — Hageman Capital is here to help. Whitney Peterson, our Director of Government Relations, works directly with municipal leaders to answer questions, provide educational materials, and walk through the specifics of your community’s situation. There’s no cost and no obligation. Fill out the form below to request a meeting with Whitney and take the first step toward voting with confidence.
If you serve on a city council in Mississippi, there’s a strong chance a Tax Increment Financing proposal will land on your agenda in the coming months. Senate Bill 2846, signed into law and effective July 1, 2026, expands how Mississippi municipalities can use TIF — and introduces a structure that fundamentally changes who carries the financial risk. Before you cast that vote, here’s what you need to know.
TIF at a Glance: No New Taxes, No Rate Increases
Tax Increment Financing is not a new tax. It doesn’t raise anyone’s property tax rate, and it doesn’t pull money away from your city’s existing revenue. Instead, TIF captures the increase in property tax revenue that a new development generates — the “increment” — and directs that increase toward paying for costs associated with making that project possible.
Here’s a simple way to think about it. Before a project breaks ground, the land generates a baseline amount of property tax revenue each year. That baseline is called the original assessed value, and it continues flowing to the city, county, school district, and every other taxing jurisdiction exactly as it always has. After the project is built, the property is worth more, so property taxes go up. The difference between the new, higher amount and the original baseline is the increment. Under TIF, that increment is set aside in a dedicated fund and used to repay the eligible project costs — infrastructure, site preparation, public improvements, and other qualifying expenses. When the TIF period ends (a maximum of 30 years under Mississippi law), all revenue, including what had been the increment, flows back to every taxing jurisdiction in full.
Nothing is taken from anyone. TIF only redirects revenue that wouldn’t exist without the project in the first place.
What Changes Under the New Law: Developer-Backed TIF Bonds
This is where SB 2846 makes a meaningful difference for council members evaluating a TIF proposal.
Under the new legislation, Mississippi municipalities can now enter into what the statute calls “taxpayer agreements” — voluntary, binding contracts between the municipality and the developer. In a developer-backed TIF bond structure, the municipality issues a TIF bond to the developer. The developer then sells that bond to a capital provider, receiving upfront cash to fund construction. The bond is repaid over time solely from the tax increment the completed project generates.
The critical distinction: this bond does not constitute a general obligation of the municipality. It does not pledge your city’s credit, taxing power, or general fund. It does not count against constitutional or statutory debt limits. The developer, not the city, carries the repayment obligation. And under the new taxpayer agreement provisions, the developer is contractually required to make up any shortfall if the increment falls short of debt service — a safeguard that didn’t previously exist in Mississippi’s TIF framework.
In plain terms, the risk shifts from taxpayers to the party building the project.
What Qualifies for TIF in Mississippi
Not every piece of land qualifies for a TIF bond. Mississippi’s TIF Act requires the project area to meet at least one of five statutory criteria: areas with blighted or deteriorated conditions, sites with buildings of historical preservation value, areas with defective street or lot layouts that impair growth, projects certified under the Regional Economic Development Act, or — and this is the broadest category — areas where construction, renovation, or rehabilitation is determined to be in the public interest.
That last category gives your governing body significant flexibility. If the council believes a project serves an important public purpose, the public interest finding can support TIF eligibility even if the area doesn’t meet a traditional definition of blight.
Eligible costs are equally broad: land acquisition, demolition, infrastructure installation, public improvements, planning and engineering, and under the new law, even the construction and equipping of private improvements when undertaken in connection with a taxpayer agreement.
What Council Members Should Ask Before Voting Yes
A well-structured TIF proposal should be able to answer every one of these questions clearly:
Does this project genuinely need TIF assistance to be viable — the “but-for” test? What is the projected increment, and does it provide adequate coverage for the bond’s debt service? What public benefits will the project deliver — jobs, infrastructure, blight elimination, expanded tax base? Is the developer financially capable of completing the project and honoring a taxpayer agreement? Has the municipality engaged independent financial analysis to verify the revenue projections? And does the redevelopment agreement include enforceable safeguards, reporting requirements, and remedies for default?
If any of those questions can’t be answered with specificity, it’s worth pressing for more information before the vote reaches the floor.
Your Role in the Process
Mississippi law requires a public hearing before any TIF plan can be approved, with published notice at least 10 days in advance. That hearing is your constituents’ opportunity to review the plan, ask questions, and raise concerns. As a council member, your vote to approve the redevelopment plan and TIF plan by resolution or ordinance is what sets the entire process in motion — from the clerk’s certification of the original assessed value through bond issuance and project construction.
You are also the safeguard. The governing body has the authority to require a “best interest” finding, to negotiate the terms of the redevelopment agreement, and to ensure oversight mechanisms are built into the deal from the start.
A Tool Worth Understanding
TIF is one of the most effective economic development tools available to Mississippi municipalities — and the new developer-backed bond structure makes it significantly more accessible and lower-risk for cities of all sizes. The increment only exists because the project exists. The developer carries the financial obligation. And the community gains jobs, infrastructure, and a growing tax base without putting public credit on the line.
The vote will come. When it does, understanding how this tool works — and what protections are built in — is the difference between voting with confidence and voting in the dark.
