How State Governments Can Help Communities Invest in Climate Resilience

In 2020, the Innovation Network for Communities, Climate Resilience Consulting, and The Summit Foundation released a report, How State Governments Can Help Communities Invest in Climate Resilience. The report presents recommendations for how states can better support climate resilience efforts at the local level. The report includes a framework for how states are already adapting to climate change (e.g., governance structures, state plans), outlines six key recommendations for developing a state-local resilience financial system, and offers a state assessment checklist to help states implement those recommendations. Through strengthening intergovernmental partnerships and providing greater financial support, states can better equip communities facing the impacts of climate change by enhancing local adaptation capacity.

With the majority of Americans identifying climate change as a threat to wellbeing, state governments are under increasing pressure to allocate resources to address the negative impacts of climate change. According to the report, building resilience not only protects the environment, but reduces social inequities, vulnerabilities, and economic disruption. However, local governments often lack the authority and resources that are necessary to successfully address the needs of the community in the face of a changing climate. Therefore, state-local partnerships — “preferably a co-development approach that starts with local communities’ needs and enables local action — are necessary to plan, prioritize, implement, and pay for climate-resilience solutions.” 

By analyzing best practices and programs implemented by numerous states, the framework identifies key components for “State Climate-Resilience Building.” The authors propose that states can help local governments and communities better adapt to climate change by developing a state-local resilience financial system. This framework and system is intended to reduce or share the costs of adaptation with local governments through the use of financial entities and tools, incentives, and regulations. While some states already have tools and structures to collect revenue and invest in public infrastructure, the function of these tools needs to be expanded to better include climate adaptation. The authors of the report identify six strategies for building a state-local financial system adapted to the demands of a changing climate:

  • Provide basic services and tools for local resilience strengthening: State governments should provide local governments with services and the assistance needed to grow local resilience capacities. For example, state agencies and planning officials can advise local governments about which local codes, ordinances, and permitting processes should contain updated climate adaptation standards. They can also clarify cost-benefit analysis requirements for proposed resilience-building activities to quantify ecosystem services, public health benefits, and the anticipated costs of climate risks. 
  • Increase the state’s financial resources for resilience investment: State governments can raise revenue for resilience-building efforts through bonds and utility rates, insurance surcharges, carbon taxes, and dedicated tax revenue.
  • Support development of local pipelines of “Ready to Go” projects for climate resilience: State governments can identify and create pipelines of priority adaptation projects to enable local governments, private sector developers, community organizations, and nonprofit organizations to design resilience projects. There should be a “ready-to-go” pipeline of fundable local projects to prepare communities to take advantage of financial opportunities.
  • Enable local funding for implementing public infrastructure projects: State governments should provide local governments with the following to invest in resilient infrastructure: tools, such as grants and loans, increased local authority to collect taxes or create special-purpose financial entities, and opportunities to increase municipal credit ratings.
  • Leverage private investment in local resilience development: State governments can develop incentives to encourage private investment to increase local resilience. For example, in Massachusetts, the Community Investment Tax Credit provides a 50-percent tax credit for donations to community-led development initiatives. Another example is green banks, which use public funds to attract private capital for green projects.
  • Push to expand and increase flexibility of federal funding for pre-disaster local resilience: State governments can advocate for more federal funding for local adaptation and resilience efforts, and promote increased flexibility in funding resource allocation.

Through developing a financial system centered around climate resilience, states can better inform the actions of local governments and bolster their capacity for implementing adaptation strategies. In addition to the financial system, the authors identify other components of successful state adaptation strategies and governances structures that states may consider to help local governments, including: 

  • Government and management of resilience buildings: Create an Interagency Coordinating Body, designate a statewide Chief Resilience Officer, and ensure investments prioritizes the frontline communities.
  • State resilience plan: Assess state climate hazards, exposure, and vulnerability, and outline adaptation strategies and initiatives.
  • Resilience standards for infrastructure: Upgrade state highways and roads, transit systems, buildings and property, emergency preparedness services, and healthcare assets to account for changing climate risks.
  • Resilience policies for state-regulated sectors: Acknowledge the state regulatory authority over utilities and support policies that favorably support local adaptation efforts. For example, a 2019 law in Puerto Rico contained provisions to improve energy-system climate resilience in response to declined performance as a result of Hurricane Maria.
  • Local resilience building capacities and actions: Recognize the importance of climate-related projects, such as improving storm-water systems and raising streets above flood levels, which will require new supportive financial capacities.

The report concludes with a comprehensive State Climate Adaptation Resilience Checklist for state leaders to self-assess their state’s resilience progress. 

Publication Date: September 2020

Authors or Affiliated Users:

Related Organizations:

  • Innovation Network for Communities

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Resource Types:

  • Best practice
  • Planning guides
  • Policy analysis/recommendations

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