The major sources of revenues for local governments are taxes, user fees and intergovernmental transfers. Taxes such as income taxes, property taxes, land transfer (stamp duty) taxes, general sales taxes and sales taxes on special commodities (licences, permits, hotel occupancy, vehicle registration etc.) along with user fees form the current operating revenues (COR) of the cities. Once the operating expenditures are met, the COR is often used for short life expectancy assets or recurrent expenditures (Serageldin et al., 2008). Reserves or borrowing are more appropriate for long life expectancy assets or non-recurrent expenditures. Reserves are created by accumulating a portion of the COR with interest in a special account which can be used for capital investments. 

TIF is a financing mechanism used to revitalise dilapidated, abandoned or brown field urban neighbourhoods within a city. Revitalisation improves the quality of urban life and increases future tax revenues. The city demarcates such areas as TIF zones for capital improvements and freezes the property tax revenues for an assigned period. The city can capitalise on funding from national and state governments or the EU for the revitalisation of the TIF Zone. The consequent future increase in property tax revenues is further invested in the economic and infrastructure development of the TIF zone. On completion of the allocated TIF period, the tax revenues flow back through the taxing authorities. Inability to achieve the projected future property tax revenues can however risk the revitalisation of the demarcated area (UN Habitat, 2009).