Municipal Backed TIF vs. Developer Backed TIF: Making the Right Call for Nebraska

Under prior Nebraska law, TIF bonds issued by a CRA were general obligations of the CRA. With the passage of LB 1135, signed into law in April 2026, Nebraska now authorizes conduit revenue bonds — a fundamentally different structure that shifts project-specific risk from the CRA to the developer. Here is why this distinction matters and why developer-backed structures are the right choice for most projects.

CRA General Obligation Bonds: The Prior Framework

Under the prior framework, TIF bonds were payable from the CRA’s revenue, income, receipts, and proceeds. While not a debt of the city, they exposed the CRA’s broader asset base to bondholder claims. If a specific project underperformed, bondholders could look to the CRA’s other resources for repayment. This created risk concentration when the CRA was involved in multiple TIF projects simultaneously.

Conduit Revenue Bonds: What LB 1135 Enables

LB 1135 creates conduit revenue bonds payable solely from specifically pledged revenues — isolating project-specific risk from the CRA’s other activities. The developer’s taxpayer agreement guarantees any shortfall, with liens carrying parity with property tax liens and priority over existing and subsequent mortgages. The developer can also agree to limit their right to challenge property assessments, providing greater revenue certainty for bondholders.

The Developer Gets the Proceeds Either Way

The bond’s value is determined by the projected ad valorem increment — which is the same regardless of whether the bond is a CRA general obligation or a conduit revenue bond. What changes is the risk allocation. Developer-backed conduit revenue bonds give the developer competitive proceeds when selling to Hageman Capital, insulate the CRA from project-specific risk, and deliver the same economic development outcomes for the community. Municipal leaders get what they want, developers get what they want, and the CRA’s broader obligations remain protected.

What You Can Do Now

With LB 1135 now in effect, Nebraska CRAs have clear statutory authority for conduit revenue bonds and taxpayer agreements. Developer-backed TIF bonds with strong redevelopment contract guarantees and the new taxpayer agreement framework give municipalities a powerful, low-risk tool for incentivizing development. Hageman Capital purchases developer-backed TIF Bonds and works with Nebraska municipal leaders and CRAs at no cost. Connect with our team to evaluate the right structure for your community.