Natural disasters — destruction from wildfires, flooding, hurricanes and hail — are setting records for both frequency and severity according to the insurance, risk mitigation and emergency management industries.
But while municipalities are racing to harden systems while building and rebuilding for resiliency, post-Covid stimulus and infrastructure funds are drawing down. On top of that, billions in federal funding are at risk and other programs are being put on hold, signaling that states and municipalities will be expected to foot more of the bill while becoming less reliant on federal grants and programs.
“Damage from extreme weather will cost the South Florida region — Miami-Dade, Broward and Palm Beach counties — more than $5.67 billion annually, per a new Urban Institute analysis using FEMA data,” reported news site Axios this August.
This perfect storm of greater need with lower federal funding is pressing cities, counties and other municipalities to explore bonds, revolving loan funds, public-private partnerships, nonprofit foundations, utility fees and other ways of footing the bill for very costly green infrastructure.
A National Model at Maryland Resiliency Authority
In Maryland, the Chesapeake Bay and waterways that connect to it are a pulsing heart of economic development, seafood harvesting, recreation, transportation and nature.
Maryland has been working for years on ways to deal with coastal erosion, flooding, environmental changes and high-impact weather events. Future-proofing roads, stormwater, sewers and other infrastructure demands billions of dollars.
In 2020, the Maryland General Assembly passed a bill allowing every jurisdiction in the state to establish a resilience authority.
The Resilience Authority of Annapolis and Anne Arundel County was created as the first multi-jurisdictional organization of its kind in the country. Matthew Fleming, the authority’s director and a 25-year veteran of the Maryland Department of Natural Resources, said it very much aims to be a national model.
“We may not have the big high-impact storms like hurricanes, but the constant erosion, the sunny day flooding, the infrastructure being inundated — we’re 520 miles of shoreline, peninsulas and creeks and these communities were getting cut off by flooding,” Fleming said. “Approaching things from a regional context makes sense.”
Some of the authority’s financial tools include:
- The capability to receive state and federal grant funds.
- Receiving funds from a local government that transfers a portion of its revenue to fund a project.
- Bonding authority to establish revenue for major projects. This way, a regional project can be done without a local government having to market, sell and repay the bonds, which can impact bond ratings for those municipalities.
- Functioning as a nonprofit (but not as a traditional 501(c)(3) to receive charitable donations from local and national foundations and philanthropic organizations.
- The authority to enter into a public-private partnership to fund resiliency.
To date, about $50 million in capital has been assembled in a portfolio built around federal, state and local grants plus charitable donations. The authority is governed by a local board of directors.
Fleming said the authority also is looking at ways to manage community assets to provide green benefits. This could include a solar energy field on government-owned land. A municipal-owned parking garage could enter a public-private partnership to bond out the asset under a new operating agreement or possibly redevelop it for revenue to fund sustainability capital projects.
“People often talk about resilience in fatalistic terms. But it can build on the strength of a community,” he said. “[Resilient infrastructure] can create inclusive places where people want to come.”
“One of our first completed projects was an ecological restoration of a stream that was getting blown out with every storm. We restored the floodplain, putting in habitat that allows water to soak in instead of flooding. We are getting better water quality and flood protection plus a wetland complex with a walking trail in a natural area that abuts a state park,” Fleming said.
The resiliency authority can work regionally to try to avoid gray, unattractive, single-use seawalls and bulkheads. With the big picture in mind, it can create nature-based systems that provide habitat while enhancing a living shoreline and supporting natural ecosystems such as oyster beds that filter the bay’s water.
Nation’s Top Project Management Firm Focuses on Funding Solutions
Tahne Corcutt is an expert in state revolving fund programs and public-private partnership funding at Jacobs, the top project management firm in the nation as ranked by Engineering News and Record. She is creating a comprehensive multi-year funding strategy for Seattle Public Utilities’ Duwamish River Valley Resilience Program. It will be funded by a combination of federal, state and local grants and loans to design and build $16 million in nature-based solutions and water resiliency.
“The old adage that an ounce of prevention is worth a pound of cure is so true with water and green infrastructure. It costs a lot less to avoid a problem than to pay to rebuild after the catastrophe,” Corcutt said.
"[Resilient infrastructure] can create inclusive places where people want to come."
-Maurice Gibb Memorial Park in Miami Beach
Corcutt said as local and regional governments seek voter approval for levies, bond issues and loans, they must sell stakeholders on the value of green infrastructure.
“It’s job creation, an economic driver, a benefit to children’s health, and opportunity to protect property values, while securing clean drinking water and protecting against flooding,” she said. “The erosion of federal funding means cities need braided funding — a combination of low-interest loans, local bonds, foundation grants and other sources to fund a needed capital improvement over a 10-, 20-, 30-year horizon.”
She noted many states such as Florida — ground zero for sea level rise, hurricanes and other climate issues — have revolving loan funds. They have to be repaid, but the interest is much lower than the interest rate of a bond issuance.
Corcutt said some cities may partner with private property owners who will benefit from flood protection or other resilient infrastructure. Cities could also work with private property owners to raise building foundations out of the floodplain or to encourage less paved surface and more plants that are good at absorbing rainwater.
The Water Infrastructure Finance and Innovation Act (WIFIA) is an EPA program that funds water and wastewater infrastructure projects. Minimum project size for large cities is $20 million and $5 million for small communities.
In Seattle, Corcutt is leading Jacobs’ work on the Duwamish River, a heavily polluted waterway surrounded by Seattle’s industrial area. The river also floods, further negatively impacting the city’s largest Hispanic community as well as lower-income, disadvantaged areas. Jacobs is working with the U.S. EPA and other entities to restore habitat and remove contamination as part of the environmental justice project.
The river restoration project is a perfect example of a “capital stack” combination of funding, including: state grants, local grants, public utilities grants, a Robert Wood Johnson Foundation grant, King County Flood Control District funding, conservation fund dollars and funding from FEMA BRIC, a federal program now suspended by the administration.
Other grant applications for the evolving public-private partnership are pending. The project team is hoping to enter a partnership with a pro sports team foundation that supports climate resilience in disadvantaged areas.
Weather-Related Events Are Putting Strain on More Than Half of State or Local Government Budgets
In early 2025, NAR asked government affairs directors from state and local REALTOR® associations across the country if weather-related events were placing a strain on their state or local government’s budget. More than half (54%) reported financial stress in government budgets from extreme weather events, requiring advocacy for improved infrastructure and resiliency funding.
Drew Myers, policy representative, State and Local Issues, Advocacy Group, National Association of REALTORS®, said state governments are taking action.
“As the administration reviews and considers overhauling FEMA disaster aid and other programs, some states are considering boosting or creating new disaster recovery funds while others will invest in their ‘rainy-day’ funds to bolster their ability to provide aid to their constituents in the future,” Myers said.
States are also thinking about longer-term strategies, debating policy solutions to address disaster preparedness, response and recovery.
“Following the tragic Camp Mystic floods in Texas, the Texas legislature passed bills that allocate funding to early warning systems and support emergency training and first-responder communication improvements,” Myers said, noting the legislation also addresses emergency manager licensing and equipment upkeep.
Earlier this year, California passed a wildfire aid package that dedicated up to $1 billion to disaster response and emergency operations while also making allocations for rebuilding homes and schools.
“In the near term, it’s possible that states with smaller budgets will see far greater challenges in responding to disasters without the access to federal dollars that they’ve had in the past,” Myers said.
ASCE Infrastructure Scorecard Emphasizes Need for Sustainability
Darren Olson, the engineer leading the American Society of Civil Engineers’ (ASCE) 2025 Report Card for America’s Infrastructure, is vice president and assistant department head of the Water Resources Department at Christopher B. Burke Engineering in Chicago.
This year’s grade was C: the highest overall grade ever awarded. ASCE credited increased investment at the federal and state levels for elevating the nation’s infrastructure grade above 2021’s C-minus.
“Infrastructure — it’s not a red thing or a blue thing — it improves life if we have clean water, safe sanitation and the commute to work is easier,” Olson said. “Transit and broadband affect everything we do. The digital transformation/AI is a huge topic. Without infrastructure, there is no AI, no massive data centers.”
Olson said the bipartisan Infrastructure Investment and Jobs Act plus the Inflation Reduction Act provided more than a trillion dollars for much-needed infrastructure, while also supporting myriad jobs.
Investing in infrastructure keeps the United States competitive in the global economy, Olson said. He noted that safe inland waterways and great ports allow things like grain and soybeans to be shipped overseas, keeping this nation competitive against other producers such as Brazil.
Investing in infrastructure keeps the United States competitive in the global economy
The ASCE urges that the momentum must continue, especially with resiliency.
“Thirty years ago, very few realized that much of our infrastructure is over 100 years old. Back then, few contemplated that the climate was going to change,” Olson said.
He said looking at life-cycle-cost savings is part of resiliency.
“When we are looking at a highway and budget for a transit lane, that is more expensive now, but it pays off over time,” he said. “When we repair a road or make it more resilient, we also need to add more space for pedestrians and biking. We need to make sure we’re not leaving anybody behind, that we are improving society when everybody is more mobile and more active.”
Olson said the ASCE estimates there is a $3.7-trillion infrastructure investment gap over the next 10 years. He believes the federal government still has a significant role to play in funding infrastructure, especially sustainability. Major projects take at least a decade, so planning for large infrastructure projects becomes difficult when federal support is in doubt.
Looking at life-cycle-cost savings is part of resiliency.
To plug the gap, Olson hopes many municipalities sell bonds. He notes there is a side benefit as America rapidly ages. Retirement-age people get a safe investment when they buy muni bonds.
States Will Take on More Disaster Prevention and Cleanup Costs
In the late 20th century, the federal government — via FEMA — took on an increasing role in funding the prevention of; response to; and recovery from natural disasters. The current administration is in the process of revamping FEMA, putting more burden on the states.
BRIC, which stands for Building Resilient Infrastructure and Communities, is a FEMA hazard mitigation grant program launched in 2020. Many states used BRIC grants on green infrastructure meant to mitigate the impact of natural disasters. Recently, FEMA canceled the BRIC program. It may come back in a new, reduced form, but for now the roughly $750 million in annual funds is frozen.
“You will have natural disasters where the feds are not going to be providing the same level of support,” said Austin Perez, NAR’s senior policy advisor, who specializes in tracking the true cost of insurance, natural disasters and their impacts on homeownership.
While that may be a difficult adjustment for some states less accustomed to frequent disasters, it’s grounded in the U.S. Constitution. Perez explains that, under our system of federalism, states hold primary responsibility for disaster response and recovery.
“Think of Katrina in New Orleans and Lahaina in Hawaii. They were so severe and overwhelming, the states had to request federal assistance, including from FEMA,” he said.
Perez said many states prone to natural disasters have already become much more self-reliant when it comes to disaster response, recovery and rebuilding. Since the devastation of Hurricane Andrew in 1992, Florida has had the top disaster response capacity of any state.
Perez noted that FEMA is widely acknowledged as one of the world’s leading agencies in coordinating logistics and immediate disaster response, particularly in situations that exceed the capacity of individual states. While FEMA will continue to play a critical role in disaster response, states will likely need to assume greater responsibility for longer-term recovery efforts.
Protecting $56 Billion In Value That Sits Only 4 Feet Above Sea Level
Miami Beach has a permanent population of about 80,000, but must provide services adequate to serve more than 13 million annual visitors who occupy more than 25,000 hotel rooms.
Though its land mass is less than eight square miles, the densely populated luxury living and resort town has a total taxable value of more than $56 billion. All that valuable residential and commercial real estate sits only four feet above sea level. With Biscayne Bay on its west side and the Atlantic Ocean on its east, the city is vulnerable to both sunny-day tidal flooding and paralyzing flooding simply when it gets heavy rains.
Miami Beach is planning to invest upwards of roughly $1 billion on resiliency. A 2018 general obligation bond brought in more than $439 million — with most of it earmarked for resiliency. Using utility fees and other resources, the city is adding water pumps, improving its stormwater network and rebuilding parks that can control flooding.
Bayshore Park, with 19.4 acres of open space and active play areas built in place of a shuttered par-3 golf course, features nature-based resiliency. In the center of the $42-million park, a one-acre lake was created to retain stormwater. A future phase will connect the surrounding neighborhood’s drainage system to the park, providing extra capacity during heavy rains.
Maurice Gibb Park was completely rebuilt with a living shoreline of mangroves, raised seawall, native trees and increasing drainage capacity. Brittany Bay Park on the Intracoastal Waterway uses a living shoreline to protect the community from storms and sunny-day flooding.
In July, Miami Beach adopted a Sea Level Rise Adaptation Plan. It was funded by a $454,000 Resilient Florida Grant and another $100,000 in matching city funds that were dedicated to compound flood modeling.
Green Initiatives Funded by Cost Savings and Facilities on County Land
John Morrill, Fairfax County’s director of the office of environmental and energy coordination, has worked on efficient energy and green initiatives in the greater Washington, D.C., area since the 1980s.
Morrill said the goal in Fairfax County, Va., is to make energy efficiency self-funding. In June, the county broke ground for the construction of a five-megawatt solar array on a closed landfill. When operating in spring 2026, the solar is expected to provide about five percent of the power needed to operate more than 500 county buildings and over 50,000 streetlights in Fairfax.
The growing county of about 1.2 million has set ambitious goals of getting 25 percent of its electricity from renewable sources by 2030 and 50 percent by 2040. Making sure new facilities are built energy efficient and spending capital dollars to improve efficiency is a way of saving power expenses, Morrill said.
He said the county’s Department of Housing office building was made more efficient and sustainable with rooftop solar panels. The building retrofit adds a new life to the structure and the energy savings — about $75,000 per year — will pay off the total cost of its capital improvements in 15 to 20 years.
“Beyond cost savings, there are environmental benefits. Reducing emissions at the power plant helps air quality for everyone,” Morrill said.
The county replaced a gas boiler with a heat pump plus solar at a large recreation center. In addition to being more efficient, the upgrade reduces greenhouse gas emissions.
The county is in its fifth and final years of converting its streetlights to LED. While the bulb investment is about $8 million total, Morrill said the more efficient bulbs allow the county to avoid about $3 million per year in energy costs to operate the more than 50,000 streetlights. As the price of energy continues to soar, the cost avoidance could be even greater.
