7: Funding and Financing Opportunities

Two of the core principles of climate adaptation are that inaction increases risk and action reduces risk. Further, many financial analyses indicate the cost of doing nothing far exceeds the associated costs for proper planning and implementation of climate adaptation and mitigation projects. Following a recommendation from the Maine Climate Council, the State of Maine and Eastern Research Group, Inc. produced a report, Assessing the impacts climate change may have on the State’s economy, revenues, and investment decisions. Volume 1 of the report is a Vulnerability Analysis (Maine.gov) (PDF) (including maps) and Volume 2 is the Cost of Doing Nothing Analysis (Maine.gov) (PDF). Refer to the respective maps and reports for more information on this research and analysis, and how it applies to local communities.

This introduction provides guidance for municipal officials that was developed through local, regional, and federal partners. Section 7.1 provides information and resources on available federal, state, and private grant opportunities. Section 7.2 provides an outline and introduction to these different types of financing mechanisms.

In 2020, the New England Environmental Finance Center (NEEFC), Casco Bay Estuary Partnership (CBEP), and Maine Department of Environmental Protection (DEP), with assistance from Resilience Works, LLC, and support from USEPA Region 1, offered a workshop series focused on crafting successful proposals toward sustainable financing of climate resilience and stormwater related projects. This series offered knowledge sharing, idea exchange, and real-world advice and inspiration. Materials and recorded presentations from several funding programs available through various Maine state agencies including the Maine Department of Transportation (DOT), Maine Department of Agriculture, Conservation, and Forestry (DACF), and Maine DEP are available on the workshop website.36

Participant feedback from these workshops was also synthesized into a Community Resilience Funding Guidance Series, which assembles the wisdom and expertise of local municipal officials on the challenges and opportunities to funding community resilience initiatives. Included are reported challenges and needs and identified actions for municipal officials to address community resilience – from developing plans and understanding a longer-term vision to implementing specific projects.37

The information in the Community Resilience Guidance Series report, Setting Municipalities up for Success, is focused on how to build a team, how to engage with community members on plans and projects, how to become more self-reliant for financing, and how to access outside funding sources with steps that align with the Resilience Building Framework. Excerpts of key recommendations from this report include:

  • Establish a team and build capacity – Project teams with knowledge of the funding and fiscal landscape will be better prepared to develop and implement a resilience strategy.
  • Focus on community outreach and build local support – An engaged community can provide the public incentive leaders need to justify the cost of building climate resilience into the town budget. Educate your fellow leaders, identify those with expertise, and tap into the existing knowledge base. Town leaders and staff need to be educated, too. If everyone begins to look at climate resilience as a component of everything they do, undiscovered expertise and previously unrecognized opportunities for cross-collaboration may be found.
  • Self-reliant financing: Assess your needs with climate resilience in mind – It is important to prioritize actions according to needs and budgets. Incorporate “no regrets” actions into routine municipal improvements such as road repair with stormwater upgrades, including green infrastructure and culvert replacements. Aim for holistic planning.
  • Find funding sources – It is important to pick the right one(s) and get the application in on time.
  • Share resources: Take a regional approach – Look for towns that share your challenges and partner with them.37

7.1 Grant and Loan Funds

Grant opportunities are abundant, and programs exist for a plethora of municipal needs ranging from community organizing, outreach, and planning to construction and town purchases. There are also many grant programs for land protection and open space that can allow for marsh migration, wildlife/habitat adaptation, or other resilience needs. Grants for development and resilience are often necessary and can be highly effective in carrying out important community actions. However, the grant process itself can also be a demanding and challenging departure from the itinerary of local governance. Competing in grant programs requires staff capacity to apply, to carry out time-stamped implementation, and for project reporting. Restrictions in how grant money can be used can at times be rigid, thus excluding broader community needs and limiting integration. Also, the intervals of awards and interruptions in available funding from grants can challenge the ability of municipal staff to retain operational knowledge from past experiences. Collectively, while grant-based funding for municipal efforts is often essential, such approaches can have maladaptive consequences for unified community climate adaptation and can reinforce a discordant patchwork of local climate resilience initiatives.

Nonetheless, well-chosen grant programs can powerfully galvanize community action and accelerate local adaptation to climate change. The following resources and guides provide more information on relevant state, federal and private funding sources.

7.1.1. State Funding

Maine Climate Change Adaptation Providers Network

The Maine Climate Change Adaptation Providers Network (CCAP) Funding and Financing page includes a Funding Guide that includes descriptions of several State funding programs relevant to climate change adaptation and mitigation as well as a number of additional federal, state, and private funding sources. The Guide also includes information on eligibility and example projects for which those grants are commonly used. The Guide is available in Appendix F of the Maine CRW. Visit the webpage frequently for updates to this Guide.

Community Resilience Partnership

The Governor’s Office of Policy Innovation and the Future (GOPIF) launched a new funding program for municipalities and service providers in Maine – the Community Resilience Partnership (Maine.gov). Refer to Section 5.4 for an overview of this program and visit the website for more information on the funding mechanisms.

Maine Department of Agriculture, Conservation and Forestry

Coastal Community Grants (Maine.gov, Maine DACF) is a competitive grant program for projects designed to improve water quality, increase adaptation to erosion and flooding, restore coastal habitat, promote sustainable development, and enhance the coastal-dependent economy while preserving coastal natural resources within Maine’s coastal zone (Maine.gov, DMR). Since 2012, this grant program has provided over $2 million for projects throughout coastal Maine. Case studies focus on sharing lessons learned “in their own words” and can be found on the Coastal Community Grant Case Studies page (Maine.gov, Maine DACF).

Maine Department of Environmental Protection

The Maine Department of Environmental Protection (DEP) grants and loans page includes information on current state loans and grants, many of which are also detailed in the CCAP Funding Guide.

Maine Department of Marine Resources

The Shore and Harbor Planning Grant program (Maine.gov, DMR) provides resources on a competitive basis for shoreline access planning, waterfront and harbor planning, identification and resolution of waterfront use conflicts, and planning, feasibility, and design efforts for resilient waterfront infrastructure. Shore and Harbor Planning Grant projects are often well prepared to compete for construction funding through other sources.

7.1.2 Private Foundation Funding

In addition to these state and federal funding sources, there are also opportunities to apply for grants from private foundations, many of which utilize the Maine Community Foundation (MCF) as their administrator for the grantmaking process. MCF offers a number of grant-funded opportunities that are detailed on their Competitive Grant Programs & Deadlines page. The Maine Philanthropy Center (MPC) maintains an up-to-date Grantmaker’s Directory that includes over 400 foundations that have a history of supporting Maine nonprofits. The Directory is available in online and print versions.

MPC members have free access to the online directory, and non-members can either access the print version by visiting their office at the University of Southern Maine’s Glickman Family Library or by purchasing a print copy.

7.1.3. Federal Funding Opportunities and Guidance

There are numerous Federal Funding Opportunities (FFO) that can be searched on the Grants.gov website. In addition, the resources in this section provide details on key FFOs for climate resilience, coastal resilience, and community resilience through nature-based solutions.

New England Environmental Finance Center

The New England Environmental Finance Center (NEEFC) Funding Guide recently published a new funding resource, Navigating the Federal Funding Landscape: A Guide for Communities (PDF). Across federal agencies, there are numerous grants and loans to help communities fund local environmental and climate-related priorities. Yet at the community level, navigating these programs and identifying the appropriate opportunities for a particular jurisdiction is a big challenge and a barrier to taking action toward funding priority projects.

This guide was developed with small- and mid-sized villages, towns, cities, and Tribes in mind to help these communities align priorities with available funding and serve as a jumping-off point for additional research, before investing time and energy into the application process.

This guide provides a snapshot of more than 20 major federal funds that support local environmental and climate-related priorities. To relate this guide to ongoing technical assistance provided by the NEEFC and its partners in communities around the country, we have focused on federal grants and loans that support activities related to four key themes: climate resilience, water resource management, renewable energy, and sustainable agriculture.

Funding sources for Open Space and Wetland Conservation

NOAA Digital Coast – Guide for Funding and Financing Coastal Resilience

The guide, Funding and Financing: Options and Considerations for Coastal Resilience Projects (NOAA) (PDF), includes information on different types of funding for coastal resilience, and details benefits, considerations, and examples for each type of funding.

FEMA Mitigation Grants

Visit the MEMA Mitigation Grants website for more information.38

Building Resilient Infrastructure in Communities (BRIC) – supports states, local communities, Tribes, and territories as they undertake hazard mitigation projects, reducing the risks they face from disasters and natural hazards. The BRIC program guiding principles are supporting communities through capability- and capacity-building; encouraging and enabling innovation; promoting partnerships; enabling large projects; maintaining flexibility; and providing consistency.39

Flood Mitigation Assistance (FMA) – funds states, local communities, Tribes, and territories to reduce or eliminate the risk of repetitive flood damage to buildings and structures insured under the National Flood Insurance Program (NFIP). This grant program strengthens national preparedness and resilience and supports the mitigation mission area through FEMA’s strategic goal of building a culture of preparedness.

Hazard Mitigation Grant Program (HMGP) – These are post-disaster grants that become available after a Presidential disaster declaration. This program provides funding for eligible mitigation activities that reduce disaster losses and protect life and property from future disaster damages in communities that have already experienced significant damages from a major natural disaster.

Building Community Resilience with Nature-Based Solutions: A Guide for Local Officials – The ‘Implementation Phase’ section of the guide, Building Community Resilience with Nature-Based Solutions: A Guide for Local Officials (FEMA) (PDF), provides information on various sources of public and private investments, from grants, taxes, fee-based incentive programs, bonds, loans, public-private partnerships, credit trading, and other typologies.

7.2 Finance Options

When grants are not appropriate for a community initiative, or when efforts require ongoing and long-term support, there are a variety of financing mechanisms to meet the fiscal needs of municipal climate change adaptation such as revolving loan funds, taxes and fees, bonds, and public-private partnerships.

Funding and Financing information – New England Environmental Finance Center’s Tools and Resources page developed Demystifying the Language of Climate Resilience Financing in 2022 clarifies key financial terms and industry jargon with simple definitions and real-life examples to address information gaps and share innovative options to pay for climate resilience needs.

This section will include descriptions of asset classes and innovative and developing financing tools, including:

  • Bonds: A bond is a financial instrument representing the debt of the company (i.e., corporate bond) or government (i.e., government bond) that issued it. Examples covered include municipal, green, catastrophe (insurance-linked security), resilience bonds, and bond banks.
  • Enterprise Fund: Enterprise funds are self-supporting government funds that provide public goods and services for a fee, which is then used to continue supporting that good or service.
    • Internal example: fee-based enterprise funds (wastewater, stormwater for example); or a financing agency as a component unit of the government.
    • External example: publicly chartered financing authority, and Public-Private Partnerships (P3s).
  • Enterprise funds, and internal and external financing institutions
  • Value Capture: Value capture is the process of recovering project costs by capitalizing on the value that the project creates. Examples covered include tax proceeds, special assessment district, tax incremental financing, and joint development.
  • Impact Investing: Impact investing connects investors’ capital and business skills to social or environmental enterprises.
  • Public-Private Partnership (P3): A public-private partnership is a cooperative arrangement between a public sector entity and a private sector company to finance and implement a project.
  • Performance-Based Financing: Performance-based financing (also referred to as results-based financing and pay-for-performance) is a contractual agreement between a funder and an implementer that establishes specific outputs or outcomes an implementer must achieve to receive payment by the funder.
  • Insurance: Insurance is the guarantee of financial reimbursement in the event of a specified event in exchange for payments (i.e., premiums). Examples covered include National Flood Insurance Program (NFIP), parametric insurance, and reinsurance.
  • Green or Resilience Bank: Green or resilience banks are publicly sponsored, mission-oriented financing authorities. These public or quasi-public institutions combine private and public funds and expertise.
  • Credit Trading System: Credit trading systems, often referred to as “cap and trade,” put a limit or “cap” on the units of pollution allowed within a specified area, such as carbon emissions or nutrient pollution in watersheds.
  • Revolving Loan Fund: Revolving loan funds are established by an initial investment that is then loaned out; as loans are repaid, the fund is replenished, and that capital can be reloaned for additional projects.

Continue to #8: Technical Assistance →

36 New England Finance Center (NEEFC) Climate Resilience Funding Workshops website,

37 Resilience Funding Guidance Series: Setting Municipalities up for Success (2021) (NEEFC) (PDF)

38 Mitigation Grants (Maine.gov, Maine Emergency Management Association)

39 Building Resilient Infrastructure Communities (FEMA)