Flood Fund oversight to remain with executive branch 

Virginia’s Community Flood Preparedness Fund, a pot of millions of dollars earmarked for community flood protection work across the state, will remain under the oversight of the executive branch despite recent legislative efforts to shift authority to an appointed citizen board. 

Gov. Glenn Youngkin has vetoed legislation that would have transferred administration of the Flood Fund from the state’s Department of Conservation and Recreation to the Virginia Soil and Water Conservation Board, a citizen body appointed by the governor in coordination with the state’s soil and water conservation districts and largest farm groups. 

In his veto statement, the governor said the bill would “have the unintended consequence of fragmenting our coastal resiliency efforts.”  

The move capped the end of an ongoing disagreement between the governor and the General Assembly over control of the Flood Fund, which to date has received roughly $136 million from Virginia’s participation in the Regional Greenhouse Gas Initiative. Under that multistate carbon market, power producers have to purchase allowances for each ton of carbon they emit in quarterly auctions. 

Youngkin had previously recommended that oversight of the Flood Fund remain with DCR, but his recommendation was rejected by a unanimous Senate vote during the one-day reconvened session in Richmond this April. 

Under the state Constitution, any bill returned to the governor from a reconvened session that is then vetoed is considered dead.

Sen. Lynwood Lewis, D-Accomack, said the dispute boils down to “a policy disagreement between the governor’s office and those of us in the Senate who have been working on resiliency for some time.” 

Since Virginia joined RGGI at the beginning of 2021, auction revenues have outstripped predictions. While state officials had estimated annual proceeds would hover around $100 million, Virginia’s 2021 revenues totaled $228 million. The first two auctions of 2022 will add an additional $150 million to that pot.  

State law says 45 percent of all RGGI money must go to the Flood Fund. Dave Neudeck, a spokesperson for DCR, said Friday that the Flood Fund currently has a balance of approximately $100 million. (That figure does not include revenues from the most recent RGGI auction.) Millions of dollars have already been paid out for local projects since Virginia began awarding grants through the program last October. 

“I don’t think anybody anticipated the type of revenue that we’d be getting from the auctions,” said Lewis. Given the dollar amounts, many lawmakers “had some real concerns with the Flood Fund being administered by [the Department of Conservation and Recreation].” 

Those concerns have largely centered on transparency about the process DCR uses to determine which community flood protection projects should be funded. 

This April, DCR Director Matt Wells sent a letter to Lewis and Del. David Bulova, D-Fairfax, outlining a series of steps the agency intends to take to ensure the public is kept apprised of how the Flood Fund, as well as the newly created Resilient Virginia Revolving Loan Fund, is being administered. The pledges include making all grant and loan applications and agency scoring and approval decisions publicly accessible, 

“Given the serious nature of this issue and the fact that public funds are involved, it is imperative that the process of awarding these grants and loans be as transparent as possible,” Wells wrote. 

Lewis told the Mercury Wednesday that he sees DCR’s commitments as “substantive.” 

“I think they have every intention of following through,” he said. “It’s just how well they can follow through.” 

Coordinating resiliency efforts 

Flood protection and resiliency have become increasingly important issues in Virginia as climate change drives shifts in weather and coastal patterns. Concerns are particularly acute in the Hampton Roads region, which is experiencing the second-fastest rate of sea level rise in the U.S. after the Gulf Coast. 

While most of Virginia’s resiliency efforts have historically been carried out on the local and regional level, a range of state-level systems for dealing with flood protection were rolled out under the prior administration of Gov. Ralph Northam. 

Northam’s term saw the creation of the positions of chief resilience officer — a job made permanent under legislation introduced in 2020 by Del. Keith Hodges, R-Urbanna — and special assistant to the governor for coastal adaptation and protection. A 2018 executive order directed the creation and implementation of a Coastal Resilience Master Plan, which was released last December. Bills during the 2022 legislative session ordered the implementation of the plan’s recommendations and made permanent a technical advisory committee for future master plan revisions. 

State funding to date has relied on revenues from RGGI, from which Youngkin has pledged to withdraw Virginia. The Flood Fund, which was created in 2020 by repurposing an earlier “Virginia Shoreline Resiliency Fund” that was never allocated any money, draws its dollars from auction proceeds. This week, the General Assembly also voted to seed the new Resilient Virginia Revolving Loan Fund with $25 million from the Flood Fund. 

Youngkin has sought to centralize the state’s resiliency efforts under a single umbrella. The creation of a “single state entity to develop, manage, and integrate coastal restoration and resilience” was one of the governor’s legislative priorities for the 2022 session. 

The proposal, however, ran into problems in the General Assembly. A Senate version died in committee; a House version was transformed into a study of whether a statewide authority was needed and then tabled. 

“The thinking of the administration is that we need this to draw federal money,” Del. Rob Bloxom, R-Accomack, who sponsored the administration’s authority bill, told a Senate panel in March. “There’s a difference of opinion on whether we need it or not.” 

Youngkin is still interested in the idea.

“The governor remains committed to establishing a single state entity to develop, manage, and integrate resilience efforts and making real progress on long-delayed projects and solutions for the commonwealth,” wrote spokesperson Macaulay Porter in an email Thursday.