Guide to 

Expanding Mitigation 

MAKING THE CONNECTION TO MUNICIPAL FINANCING 
Cover Photo: People analyzing graphs on desk in office 

Photo: A morning shot of Marcellus, N.Y. 

Photo: Two children hold hands and look at flooded homes 

Disasters are difficult to predict. When they strike, their impacts can have long-term 

consequences for residents and the community. To reduce the impact of future 

disasters and improve the resiliency of your community, it is important to invest in 

mitigation. As you advance through the hazard mitigation planning process, exploring 

options that will reduce your community’s risk it is critical to identify funding options 

for these efforts. Creating a funding strategy from multiple diverse sources will help 

to secure the funding necessary to keep your community safe from future disasters. 

Your local financial professional, whether the business administrator or financial 

officer, can help you explore creative public and private funding sources, and 

consider these questions: 

• Does the mitigation project fit into the current budget or can it be planned 

for a future cycle? 

• Can the mitigation project be added to the Capital Improvement Plan? 

• What else can be done to prioritize the project for funding? 

This Guide to Expanding Mitigation explores how 

community officials can work with finance officials to 

support hazard mitigation planning, and how mitigation 

investments can align with community budgets and 

financial management priorities. 

This Guide to Expanding 

Mitigation is part of a series 

highlighting innovative 

and emerging partnerships 

for mitigation. 

Cover Photo: People analyzing graphs on desk in office 
Photo: Man discusses data with colleagues 

PARTNERING FOR SUCCESS: WORKING WITH 

YOUR COMMUNITY’S FINANCE PROFESSIONALS 

Collaboration and partnership with finance professionals is central to the mitigation 

planning process. They can help you identify funding sources to make hazard 

mitigation plans a reality. Together, you can explore various funding sources, 

including federal and state grants, state revolving loan programs, or bonds. 

Working closely with your local finance professionals offers many benefits. 

Involving them early in your planning process can help to ensure your community 

has a solid funding strategy to implement the hazard mitigation projects. 

Local financial professionals often have diverse roles; they may oversee the 

community finance department and wear the hats of business administrator 

and/or financial officer: 

• The business administrator reports to the governing 

body. Their responsibilities and functions vary by 

community. They may also serve as the municipal 

manager, chief of staff or top appointed staff person. 

A business administrator has awareness of local 

priorities, the history of decision making, constraints, 

and which departments and staff can make projects 

a success. 

• A financial officer is often more specialized than 

a business administrator and primarily “keeps the 

books” for the community. Other responsibilities
 

may include budget tracking, maintaining payroll 

records, balancing funds, and crafting reports to
 

aid administrative decisions.
 

Federal mitigation grants 

yield high dividends. 

According to the National 

Institute of Building 

Sciences 2019 Mitigation 

Saves Report, for every 

federal grant dollar spent 

in upfront mitigation
 

costs, the public saves 

six dollars.
 

Photo: November day in Hoboken, N.J. 

Your local finance professional’s 

deep understanding and connection 

to the community’s financial 

landscape can be a tremendous 

asset to mitigation projects. Their 

insight and connections can: 

• Advise you and help to incorporate 

the mitigation project into longer 

term planning within the community 

budget or Capital Improvement Plan. 

• Position you to pursue limited 

mitigation funding. Your case for 

enhancing community resilience 

will be stronger when the projects 

are built into the community budget 

or Capital Improvement Plan. 

• Help you communicate with internal 

partners to share the value of 

preventative actions to keep 

the community safe, maintain 

operations, buttress revenues, 

and reduce future losses. 

ALIGNING RESILIENCY AND 

RESOURCES IN HOBOKEN, NJ 

The city of Hoboken aligned its business 

administration and resiliency priorities 

so that the budget reflects mitigation 

actions the city must take to sustain the 

community. After Hurricane Sandy in 2012, 

the city started to direct financial resources 

toward mitigation goals. Hoboken tracks 

all capital improvement projects through 

robust spreadsheets and maps so that the 

Capital Improvement Plan can be codified 

and analyzed over time. Hoboken allocates 

local dollars for higher frequency, low 

consequence events like nuisance flooding, 

and federal dollars for lower frequency, high 

consequence events like hurricanes. The 

city uses smaller, highly visible projects 

to nurture community buy-in then looks 

to state and federal partners to take on 

higher cost projects. This is important for 

demonstrating the efficacy of mitigation 

projects. The business administrator, 

chief resiliency officer, and mayor work 

together to ensure long-term investments 

support the long-term health—financial or 

otherwise—of the whole community. 

Photo: Man discusses data with colleagues Photo: November day in Hoboken, N.J. 
’

Photo: Home elevated in Pequannock, N.J., following Hurricane Sandy 

CORE FINANCE PLANNING QUESTIONS 

Financial professionals can help you think through several questions: 

• How will the community pay for or meet the match requirement? Can the 

community pursue a bond? Are there alternative sources of funding such 

as open space or stormwater management utilities? 

• Can the project meet multiple community needs and provide co-benefits? 

If so, are there partner agencies that can also identify funding? 

• What is the best timing for the project? Can the project be accomplished 

in the short term, or will it have to wait for more urgent priorities? What is 

the period of funding need? 

• Are there other financial stressors that may prevent mitigation progress? 

When unexpected events occur, is there an option to revisit priorities in 

the Capital Improvement Plan? 

• Which staff can administer the project? Do you need to hire a contractor? 

• What information do you need to complete the project scope? What are 

the requirements to bid the project (e.g., prevailing wage)? 

• If you plan to remove buildings from high-hazard areas, how will this affect 

employment and your tax base? Will lost revenues hurt the community’s 

credit rating? Do public safety and community resiliency take precedence 

over lost revenue? 

COMMUNITY PLANNING AND ACCOUNTING METHODS 

Community budgets represent community priorities. The budgeting process is one of 

the most important tasks of municipal government. The local governing body passes 

an annual budget that includes revenues and expenses and establishes the amount of 

funding to programs and projects. The budget contents are analyzed and tracked. 

Capital Improvement Plans itemize projects when (because of immediate priorities) the 

scale, method of funding, lead time for design and permitting, and other considerations 

will not be included in the current annual budget. For projects that have been identified 

for future years, the Capital Improvement Plan is a document that provides details, 

funding, and financing options. 

The mitigation professional has a role in pitching mitigation projects during the 

development of the Capital Improvement Plan. In this plan development process, the 

mitigation professional should meet with the financial professional to flesh out the 

project. This will help establish the timing for the project since the financial professional 

knows the most about the community’s revenues, expenses, and debt obligations. 

As a team, you will identify the likely funding sources, including those from grants. 

Photo: People s hands point to information on calculator and portfolio 

COMMONWEALTH OF MASSACHUSETTS INTEGRATES 

MITIGATION AND FUNDING 

In 2018, the Commonwealth of Massachusetts identified 130 actions 

in its Integrated State Hazard Mitigation and Climate Adaptation Plan. 

With the governor’s support, the state hazard mitigation officer worked 

with the director of the Office of the Capital Budget in classifying funding 

sources for each action with cross-references to the five-year capital 

plan. The identification of financing gaps resulted in the commonwealth 

bonding for specific actions. From now on, Massachusetts will score the 

efficacy of the projects on the risk protection gained to influence future 

resiliency decisions across agencies. 

Photo: People s hands point to information on calculator and portfolio 
 

 

Photo: Construction engineers discussing blueprints 

FUNDING MECHANISMS 

Hazard mitigation projects can be funded by various sources. Collaborating with a 

finance professional can help with identifying innovative ways to blend funding sources: 

• Federal/state/non-governmental organization grants – Grants are a source of funding 

that typically require an application with detailed support. Federal, state and nongovernmental organizations issue grants for pre- and post-disaster periods. The grant 

may not cover the full expense of the project, and your community may be responsible 

for matching the grant amount. Your finance professional will help you review the terms 

of the grant and determine the most appropriate method to match the grant. 

• State revolving loan programs – Revolving loan programs have been successful 

nationwide in addressing infrastructure demands. In some cases, federal funding has 

been allocated to states to establish a low or no-interest loan program, or states have 

issued debt to finance state programs. Unlike grants, the loan must be repaid, subject 

to certain relief in interest, so that the funding goes back into the program for reuse. 

• General obligation bonds – This is debt issued by local governments that raise money 

for projects. General obligation bonds are commonly used and familiar to your financial 

professional. Communities typically apply property, sales, and/or income taxes to 

pay investors principal and interest. Caution should be observed because the bond is 

backed by the “full faith and credit of the municipality,” and this means if the budget 

is incapable of servicing the debt, the government would have to increase taxes to 

guarantee the bond is paid. 

• Other sources of funding – Additional sources of funding, such as fees, assessments, 

other bonding instruments, and private investment, may not be identified in the above. 

MITIGATION FUNDING AT EVERY 

LEVEL IN GRANITE FALLS, MINNESOTA 

To implement its mitigation strategy, the city of Granite Falls, Minnesota, 

identified 10 local, state and federal sources for funding mitigation 

projects across the city. Granite Falls used local tax increment financing 

and private investment for some mitigation projects. From state and 

federal sources, it received nearly $38 million over two decades. The 

city used those funds to reduce risk to residential, commercial, and 

governmental structures, to reconstruct a flood wall, to buy and demolish 

at-risk structures, and more.
RESOURCES 

Guides to Expanding Mitigation 

https://www.fema.gov/mitigation-risk-reduction 

Link to all available Guides to Expanding Mitigation. 

For the Mitigation Professional 

Land Use Tool: Capital Improvement Plan 

https://planningforhazards.com/capital-improvement-plan 

Learn how to integrate hazard mitigation into a capital 

improvement plan. 

Bonding 

http://news.morningstar.com/classroom2/course. 

asp?docId=5384&page=1 

Learn about general obligation bonds. 

Funding Opportunities 

https://toolkit.climate.gov/content/funding-opportunities 

Learn about a range of government and private financing 

for climate adaptation and resilience projects. 

For the Financial Professional 

FEMA Hazard Mitigation Planning 

https://www.fema.gov/emergency-managers/risk-management/ 

hazard-mitigation-planning 

Review standards and guidance for the planning process. 

ACKNOWLEDGEMENTS 

We thank the following organizations, whose staff contributed their time toward 

advancing our understanding of mitigation and municipal financing: Borough 

of Sayreville, NJ; City of Hoboken, NJ; D.A. Davidson Companies; Enterprise 

Community Partners; FEMA Region 2; Jersey City, NJ; Town of Kearny; 

Massachusetts Emergency Management Agency; Michael Baker International; 

Wharton Risk Center; and Woodbridge Township, NJ. 

ENGAGE WITH US
 

Are you a state, local, tribal or territorial official interested in making the 

connection between finance and hazard mitigation? Are you a finance 

professional interested in connecting with local officials to reduce risk 

from hazards? Would you like guidance on mitigation funding sources 

or a copy of FEMA’s Mitigation Resource Guide? Please contact us at 

FEMA-ExpandingMitigation@fema.dhs.gov. 

Photo: Young man makes a budget at home