In this paper, the active damping of LCL filter resonance of a grid-tied inverter is studied. We show the tradeoffs involved in designing a hierarchical inner-outer control system by analyzing the control-relevant properties at multiple loop-breaking points. We demonstrate how a novel inner-outer control design technique can help obtain reasonable properties simultaneously at the error and plant input/controls. Specifically, we show how inner-loop controller affects the robustness margins, and hence affect the sensitivity properties of the system. A new controller structure is proposed that includes a lag network in series with the traditional inner and outer controllers , , typically used in grid current feedback control, presenting a systematic approach for designing more robust active damping strategies. Further, we present a generalized H∞ mixed-sensitivity framework for designing hierarchical inner-outer loop control systems, that helps directly address closed-loop properties at multiple loop-breaking points. We show how an 'equilibrated' design can be obtained by trading off properties at these multiple loop-breaking points.