Contemporary urban leaders use exotic fiscal and financial schemes to fund development, which scholars theorize as tools for creating public goods or critically as growth entrepreneurs’ speculative self‐enrichment schemes. Neither approach accounts for financing schemes’ reactivity, or their tendency to shape development patterns. This paper facilitates analysis of the latter by developing a new theory of growth coalitions: the politics of earmarking perspective. Urban leaders are akin to local state builders whose superordinate concern is establishing priority over revenues earmarked for noncity functions, a goal they pursue by pairing financing schemes with developments that maximize discretionary revenue under unique geographic, fiscal, and regulatory constraints. I illustrate this perspective's utility by comparing scholarship on California's municipal fiscal crises with an ethnography of development in two Iowa cities. Although reliant on the same financing mechanism—tax increment financing—California's municipal leaders pursued discretionary revenue by incentivizing extravagant commercial developments, whereas Iowa's directed industries to outlying business parks.