State delays flood resiliency grant manual to pursue federal funds

The state agency that oversees the doling out of millions of dollars in state funds for flood resiliency projects is delaying the release of new guidelines to apply for the funds in order to seek federal funding from a new program.

“We chose to focus our resources on these federal dollars,” Department of Conservation and Recreation Director Matt Wells said at a recent meeting on the Virginia Coastal Master Resilience Plan. “Because even if it’s only $50 million, [we] hate to miss it. Not every state is going to be in a position to try to capture these funds. We feel like there’s a good chance that we could get a little bit more than the share that we normally get.”

Virginia is hoping to tap into about $50 million available in the Federal Emergency Management Agency’s Safeguarding Tomorrow Revolving Loan Fund, which is open to all 50 states, with a minimum application of $5.1 million. Virginia would be required to provide a 10% match for any award from FEMA.

The decision will delay the release of proposed updates to the grant manual developed by DCR to guide local governments in applying for funding from the Community Flood Preparedness Fund, or Flood Fund. That pool of money was created by 2020 legislation from Sen. Lynwood Lewis, D-Accomack, to channel almost half of Virginia’s revenues from its participation in the Regional Greenhouse Gas Initiative, a carbon market, into local flood resilience projects. Gov. Glenn Youngkin has been seeking to withdraw Virginia from RGGI since shortly after his election, calling it a hidden tax on Virginians.

In order to apply for Flood Fund dollars, which are issued in waves of grant rounds, local governments must follow procedures outlined in the grant manual. 

After three and a half rounds of grant awards and the most recent auction of carbon allowances, about $107 million is available in the Flood Fund.

Wells said the delay in releasing the new grant manual won’t delay the next application windows for grants from the Flood Fund or the Resilient Virginia Revolving Fund, which he said are expected to open in the second half of 2023. 

“The only delay will be to the publication of the CFPF/RVRF manuals for public comment,” he wrote in an email. 

Virginia recently became eligible for federal dollars through its creation of the Resilient Virginia Revolving Fund, a loan program that was seeded with $25 million from RGGI funds and can be used to provide state matching dollars. 

“This is one of the purposes for which the RVRF was created,” Wells said in an email to the Mercury. 

The grant manual sketches out the requirements local governments must meet in order to qualify for Flood Fund awards. A 2021 version notes it provides “guidance regarding the policies, criteria, conditions, and procedures for determining project eligibility and awarding grants … to local governments.” 

After the grant manual is released, the public can comment on its provisions, leading to revisions of the eligibility criteria. 

For example, when the 2021 draft was released, the Virginia Floodplain Management Association provided comments seeking clarification of a number of terms, including the definition of nature-based solutions. State law governing the Flood Fund says that priority should be given to projects that “use nature-based solutions to reduce flood risk.” 

Association President Kristin Owen said the grant manual’s definition of nature-based solutions was “too narrow,” suggesting using instead a FEMA definition that states a nature-based solution “weaves natural features or processes into the built environment to build more resilient communities.”

DCR later revised the manual to include a line stating a nature-based solution “includes a project that reduces these impacts by protecting, restoring or emulating natural features.”