Funding

The “X” Factor – Future Funding for Future Needs

Urban forestry as a stormwater management strategy represents a long-term investment that demands careful management for decades into the future. Budgets change, however, and certainly don’t automatically grow to match maintenance costs as trees grow older and decline. Initial budgets and staffing plans must anticipate both these initial and downstream costs – and build on strategies that assure programs can sustain themselves into the future.

Banking on Green

Based on extensive research and case studies, four participating organizations (American Rivers, American Society of Landscape Architects, Water Environment Foundation, and Eco-Northwest) concluded that compared with gray infrastructure, functioning green infrastructure programs:

  • Reduced built capital costs (equipment, installation)
  • Reduced operation costs
  • Reduced land acquisition costs
  • Reduced repair and maintenance costs
  • Reduced external costs (off-site costs imposed on others)
  • Reduced infrastructure replacement costs (potential for longer life of investment)

EPA Guidance on Funding Green Infrastructure

Getting to Green: Paying for Green Infrastructure, Finance Options, and Resources for Local Decision-Makers – This report summarizes various funding sources that can be used to support stormwater management programs or finance individual projects. Each type of funding source is illustrated by several municipal programs and contains a list of additional resources.

EPA’s Managing Wet Weather with Green Infrastructure Municipal Handbook: Funding Options – This guide, which is part of EPA’s Municipal Handbook series, discusses two of the most common funding options that communities use to fund green infrastructure: stormwater fees and loan programs.

 

Stormwater Management Funding

Communities fund stormwater capital and operating expenses in a variety of ways, often by collecting fees through separately-constituted stormwater utilities. Other mechanisms include service fees based on a property’s impervious cover; special assessment districts; system development charges (also known as connection fees or tie-in charges); grants; and low-interest loans, including EPA’s Section 319 state revolving fund. The National Association of Clean Water Agencies reviews many of these options, and includes guidance on establishing a stormwater utility.

Ecosystem Service Revenue

In California, the cap-and-trade system directs funds accrued from companies that exceed pollution limits to state-wide and local urban forestry programs. Other municipalities are exploring how to grow dollars from the carbon dioxide absorbed by their trees. Markets are just emerging, but this unusual revenue source bears watching.

Fines

Tack on a tree replacement fee to traffic fines for motorists who mow down street trees. Likewise, some communities may dedicate a small proportion of large environmental fines to urban forestry needs.

Mitigation

Owners who choose to remove trees from their own property can mitigate the loss by paying a sum equal to the benefits forgone from those trees. Funds can be used to plant new trees or as part of the general municipal forestry budget.

Tax Increment Financing (TIF)

For 50-plus years, municipalities have used this public financing method as a subsidy for redevelopment, infrastructure, and other community-improvement projects. Through the use of TIF, municipalities typically sell bonds backed by a development’s future taxes, with the bond money helping to pay for public space enhancement and development costs.ans.

Business Improvement Districts (BID)

Business Improvement Districts are defined areas within which businesses elect to pay a levy – a “self-imposed-tax” – to provide services and programs to the entire BID, beyond what the city provides. The aim of these public-private partnerships is to attract and retain businesses, increase sales and taxes, generate jobs, and enhance the quality of life in the neighborhood. BIDs exist in almost every one of the top 50 largest cities in the United States as well as in many smaller communities.

The BID for Washington, DC’s central business district paid for extensive – and visually attractive – curb-cut tree trenches to make the neighborhood more appealing.

Curb cuts, trees, and public art beautify business district.