TIF Expertise: Common Pitfalls for Mississippi City Council Members to Avoid

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.