Bloomberg News
Connecticut’s governor proposed a new public finance tool as part of a broad plan to improve the state’s resiliency against extreme weather and climate change.
The nine-policy-point program Gov. Ned Lamont released on Jan. 21 includes what his administration calls “a new twist on the tax incremental financing mechanism for the purposes of resiliency – Resiliency Improvement Districts.”
The state government’s Connecticut Green Bank already offers resiliency financing tools for individuals.
It’s not enough, Bryan Garcia, the Green Bank’s president and CEO, said at Lamont’s
“We need community-scale investment,” Garcia said. “We definitely need to see that community-wide approach to supporting resilience projects. And when we see that, the insurance industry will take note.”
In introducing the plan, the governor touched on a series of severe floods that have struck areas around the state since 2023, followed by a drought that led to widespread brush fires in late 2024.
Lamont said the series of weather-driven disasters convinced him that there is far more to worry about in preparing for climate change than rising sea levels, the obvious threat to Connecticut.
George Temple, the first selectman of Oxford, appeared at the briefing to talk about the massive rainfalls and floods that killed two residents of his 13,000-population town.
“Little River is just that, a little river, actually a little oversized brook. But it was a raging torrent that day,” Temple said.
“I was shocked when I went down to the Naugatuck Valley after that flooding,” Lamont said. “Nobody had any flood insurance. It wasn’t in a floodplain.”
The Connecticut Green Bank’s Garcia said the proposal would give communities the authority to vote to create Resiliency Improvement Districts, which would levy a benefit assessment on properties to fund projects that improve resiliency.
“That’s what unlocks the private investment from bonds and other sources of capital that we’re excited about,” Garcia said.
“Those plans need to be revenue-grade plans,” he said. “They need to be investable.”
Other aspects of the plan Lamont asked state lawmakers to approve include better notifications of flood risks and the availability of flood insurance; more thorough review of coastal development; cutting back on state infrastructure investments in high-flood-risk zones; better tracking of culverts and bridges that could exacerbate flooding; and a development rights transfer program.
Municipal Market Analytics President and Managing Partner Tom Doe, in MMA’s Jan. 27 Weekly Outlook, wrote an opinion piece calling for a more realistic approach to climate change – by emphasizing adaptation to the change that’s already baked in through rising global temperatures.
“The genie is out of the bottle,” Doe told The Bond Buyer last week. “These weather events are going to continue, and are going to strain infrastructure.”
The necessary capital investments will be huge.
“I think it’s terrific what Gov. Lamont is doing,” Doe said. “This is the kind of thing that will happen incrementally. This is why I believe in 10 years we’ll have a trillion dollar muni market. These are the kind of projects that are going to fuel it.”
Republican leaders in Congress are talking about
The exemption is “a cheap and effective way for the federal government to provide a lot of leverage,” he said. “If state and local governments are going to be accountable for climate stuff it’s smart to provide that.”
A similar bill
“With all of the weather events that impacted communities across the state last year I just think there’s a growing sense of urgency to move some of these tools forward,” Katie Dykes, commissioner of the state Department of Energy & Environmental Protection, said at the briefing.