Funding Resilient Infrastructure: What are the Options?

I recently wrote a post on the double climate risk that the Texas Gulf Coast faces Gfp-texas-houston-bayou-river-in-the-cityregarding climate change. One of the primary concerns is the lack of local funds that are available to maintain existing infrastructure, much less develop more adaptive infrastructure.

However, there are a variety of options for the Gulf Coast to consider to help fund the development of more adaptive infrastructure, including grants, bonds, loans. etc. A helpful resource would be the US Climate Resilience Toolkit that lists a variety of resilience and adaptation funding opportunities. Another resources, although I am a bit hesitant to suggest it is the EPA’s Climate Change Adaptation Resource Center (ARC-X) . This site also provides a great deal of information of federal funding and technical assistance for communities to invest in adaptative infrastructure. It looks like this assistance and funding will stick around for the remainder of the year, with the continuing budget resolution, but may go away in the next budget cycle if the 31% cut to EPA’s budget happens as recommended by the GOP.

Other than these resources, a potential opportunity from FEMA is the National Mitigation Investment Strategy (NMIS). According to FEMA, the NMIS “provides an opportunity to be more intentional about setting resilience and mitigation investment priorities, and will increase the ability of Federal Departments and Agencies to plan and justify budgets and resources that invest in mitigation and resilience due to the amount of disaster loss reduction anticipated from these investments.”  The NMIS is currently taking comments and input from stakeholders. The Gulf Coast may want to think about how it can participate in guiding the development of this investment strategy. In line with this strategy, FEMA is also considering the Public Assistance Deductible. This is still under review, but if it does see the light of day, will require states to spend a specific amount on emergency preparedness and disaster costs. Once a state spends a predetermined amount, FEMA will provide funds to pay for a repair critical infrastructure damaged during a specific event. This really does not seem too feasible for states who are fiscally constrained, but FEMA is testing the idea in 2017.

A significant unknown, but a potential great opportunity for Cities is the mobilization of the capital markets to invest in more resilient infrastructure. There has been a some interest in public private partnerships (P3s), as well as resilience bonds and green bonds. There is a growing desire to help invest in new adaptive infrastructure, but within the United States has not gained a significant amount of traction. That being said, there are some options. A group called Wall Street without Walls is trying to drive a bit more interest from the capital markets and have largely been involved in economic development in low and moderate income communities. Another example, that other states may want to consider, is the Business Oregon state economic development agency and its Infrastructure Finance Authority (IFA). The IFA invests in critical infrastructure in communities across the state to improve resilience and sustainability. Future posts will further look into how the capital markets may be the best bet for cities to develop more resilient infrastructure.


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Gavin Dillingham

Program Director for Clean Energy Policy at HARC a sustainability research institute in The Woodlands, TX. Work on climate adaptation and investment strategies for resilient infrastructure.

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