Land Use & Zoning

A Mississippi municipality's 'community redevelopment plan' designates an area as blighted and proposes using tax increment financing (TIF). TIF works by:

ARaising property tax rates in the designated area
BCapturing the increase in property tax revenues generated by rising values in the redevelopment area to fund public improvements within the district✓ Correct
CProviding direct federal grants for infrastructure
DRequiring developers to pay a special tax surcharge

Explanation

Tax Increment Financing (TIF) freezes the tax base at current levels when the district is created. As development occurs and property values rise, the incremental increase in tax revenue is captured to fund public improvements (infrastructure, environmental cleanup, etc.

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