Which bonds are issued as part of an economic development strategy and are repaid from increased property tax revenue?

Tax Increment Financing Bonds play a critical role in economic development strategies, specifically designed to fund projects that are expected to stimulate growth in a designated area. These bonds leverage the concept of tax increment financing, where the increased property tax revenues generated by the improvements are used to repay the bonds.

When a municipality invests in infrastructure or other development projects, that investment can lead to enhanced property values in the area. As property values rise, property tax revenues also increase. The funds generated from these increased revenues are earmarked for repaying the debt incurred through the issuance of the tax increment financing bonds. This creates a self-sustaining cycle where the upfront investment in development leads to future tax revenue, thus facilitating ongoing growth and improvement in the community.

In contrast, the other options do not specifically relate to an economic development strategy or the repayment through increased property tax revenues. Debt Service Reserve Funds are mechanisms designed to serve as a backup for paying debt service but do not directly involve property taxes or economic development. Capital leases and leasing are forms of financing that do not necessarily connect to the specific strategy of using tax increment revenues for repayment.