Resilience Funding

What is Federal Resilience Funding?

The federal government spends billions of dollars every year funding grants to help U.S. communities become more resilient to severe weather events, which are expected to increase in frequency and severity as a result of climate change. This funding generally does not explicitly focus on climate change impacts, but rather severe weather hazard mitigation broadly. While some of the funding supports pre-disaster risk management and the Federal Emergency Management Agency (FEMA) has requirements for pre-disaster and multi-hazard mitigation[1] plans, the vast majority of funding and resources has historically been granted in the wake of disasters, to help affected communities recover and prepare for future severe weather events. Federal resilience funding, through existing or new mechanisms, could expand to be more proactive than reactive.

Funds are granted by individual federal agencies through their existing programs on an ad hoc basis. FEMA and the U.S. Department of Housing and Urban Development (HUD) are among the agencies that provide this funding. Their programs can enhance community resilience by funding a range of projects, from developing a community hazard mitigation plan to structural retrofitting to floodplain management. In many cases, these projects can also benefit human health and local economies.

How does Federal Resilience Funding Work?

There are numerous federal funding sources that can be used for projects that enhance resilience. Funding can be provided before or after a disaster occurs; it can be delivered through an emergency appropriation or an authorized, recurring program; and it can be focused on projects that directly reduce physical exposure to severe weather (through relocation or development of green or grey-infrastructure protection) or also address broader recovery efforts. We discuss examples of each in the U.S. Experience section below.

Key design considerations

The effectiveness of federal resilience funding is driven by the following considerations:

Is funding granted by one federal source, which could encourage collaboration across sectors, but would require new Congressional authorization? Or is it granted by multiple sources (as is the current model), which can be a beneficial structure for stakeholders when any one source of funding is unavailable for a project, but can also be burdensome to manage?

Should pre-disaster projects be eligible, or should a given program only fund post-disaster efforts in communities that are affected by disasters? Which entities are eligible for a specific funding program? What restrictions, if any, should be placed on the types of projects that can be funded through these programs?

Are cities and states prepared to use the funds effectively? Have cities and states already developed a broader hazard mitigation plan that identifies local risks and vulnerabilities? How can planning help build consensus and ensure best strategic use of funding?

Will grant-funded projects offer multiple benefits (e.g., benefits to human health and local economies) for communities that increase the federal return on investment? For example, green infrastructure can lower maintenance and operating costs for state and local governments, as well as mitigate the urban heat island effect and water quality issues.

How can programs complement one another, encourage synergies, and avoid working at cross-purposes?

U.S. Experience

The FEMA Hazard Mitigation Grant Program (HMGP) is available after a disaster declaration. The size of the grant is determined using a formula based on the percentage of total funds spent on public and individual assistance as a result of the disaster. These funds can be used for a number of hazard mitigation measures, defined by FEMA as “any sustainable action taken to reduce or eliminate long-term risk to people and property from future disasters”.[1] Examples of eligible projects include: elevation of homes, floodplain and stream restoration, and structural retrofitting (for flood, high winds, or fire protection). HMGP funds are allocated to states, federally-recognized tribes, and territories, who then administer the funding to local governments, state agencies, and nonprofit organizations to carry out the projects. Individual property owners can receive funding if sponsored by one of these local stakeholders.

HUD Community Development Block Grants – Disaster Recovery (CDBG-DR) is also available post-disaster by Congressional direction after each disaster. This funding is some of the most flexible federal money provided to states and municipalities after major disasters. It can be used for a broad range of activities related to the restoration of infrastructure and housing, actions to protect from future damage, and economic revitalization. When these projects are designed and implemented with future climate impacts in mind, they can enhance community resilience to future events. CDBG-DR funds are awarded to state and local governments, who then allocate funding to state agencies, non-profit organizations, economic development agencies, businesses, and citizens to implement projects.

The National Public Infrastructure Pre-Disaster Mitigation (PDM) Fund, part of the 2018 Disaster Recovery Reform Act (described below), will enable FEMA to fund pre-disaster mitigation activities using an additional percentage of the funds FEMA allocates for disaster recovery efforts. FEMA estimates that this program will deliver between $200 and 300 million a year for resilience projects. PDM funds will be awarded to states, territories, and federally recognized tribes. Local governments can receive funding from one of these stakeholders and can also sponsor homeowners in completing projects. Funds can be used for the creation of a community mitigation plan or for a number of natural hazard mitigation projects. The PDM fund will replace the FEMA Pre-Disaster Mitigation Grant Program, which has assisted communities in risk mitigation for years, but has had limited funding (in the tens of millions of dollars annually) with rare occasions where a few hundred million dollars were appropriated to fund projects across the nation.

The federal government’s focus on resilience funding has historically been in reaction to disasters, rather than a coordinated, proactive strategy. The U.S. Government Accountability Office found that this approach exacerbates fragmentation and encourages balkanization, limiting the efficacy of these programs. But recent shifts signify a changing landscape of disaster preparedness and resilience investment. One of Congress’s significant, recent advances in funding pre-disaster mitigation included an appropriation in 2018 of nearly $16 billion in funding directed at mitigating future risks in communities that faced devastating losses from 2015-17, to be distributed through the CDBG-DR. Further, the 2018 Disaster Recovery Reform Act included structural reforms of how federal recovery programs are funded and implemented. New dedicated funding for the National Public Infrastructure PDM fund to be administered by FEMA (discussed above) was authorized through a 6 percent set-aside of disaster funding expenditures from key federal recovery programs.

Additional Resources

[1] Note that throughout this section the term “Mitigation” is used to refer to not greenhouse gas emissions reductions but rather actions that prevent or remdiate a harm, such as flooding, fire, storm damage, drought or many other events or conditions.


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