This article is the third in a series examining climate adaptation and hazard mitigation financing at the federal, state, and local levels. Part 1 looked at the gaps resulting from recent cuts to FEMA funding. Part 2 examined growing but still inadequate state funding for wildfire resilience.
Even before the federal government began retreating from the climate and disaster mitigation space earlier this year, with cutbacks at the Federal Emergency Management Agency (FEMA) and other agencies, state and local governments were shouldering most of the nation’s infrastructure burden, funding about 78% of all infrastructure projects while also serving as the projects’ primary builders and maintenance providers. This system functioned because of an informal understanding that the federal government and private insurance markets would step in after disasters to help with response and rebuilding in a more resilient manner. Since the 1990s, FEMA has supported local disaster response and relief needs. However, as annual costs ballooned past $30 billion over the last five years, the federal government made cutbacks to FEMA disaster relief and mitigation grants, ultimately shifting the cost burden squarely onto state and local governments as well as private residents.
With the rising frequency of climate disasters, combined with California’s budget crisis, local governments are increasingly unable to bear the costs of infrastructure construction and maintenance, climate adaptation, and community-scale hazard mitigation. Local budgets remain constrained by California’s property tax limits, set under Proposition 13 (1978), and by outdated public financing tools. To fund activities not covered by the existing city budgets, municipalities tend to rely on a narrow set of mechanisms: general obligation bonds, parcel or sales taxes, and state or federal grants.
The result? Local governments and residents are increasingly responsible for mitigating and financing wildfire, seismic, and coastal flood risks. Without broader, coordinated support, local tax measures could create fragmented resilience initiatives that are spread inequitably across the Bay Area. At the same time, underinvestment could result in increased disaster costs in the long term.
The Tools We Currently Use: Taxes and Bonds
Some Bay Area cities, including Oakland and Berkeley, have turned to local tax measures to fund climate resilience and preparedness. Local measures, approved by voters, allow cities to tailor investments to their unique risks while maintaining accountability to residents. Regional entities have also introduced creative approaches to scale and sometimes share resources for climate resilience. The Marin Wildfire Prevention Authority, for example, uses a county-wide parcel tax to fund wildfire prevention.
Local and Regional Tax Measures for Climate Resilience and Hazard Mitigation
Measure | Tax Measure Structure | Purpose | Capital Raised |
City of Oakland Wildfire Prevention Parcel Tax (Measure MM, 2024) | 20-year special tax in the city’s high-risk fire zone. $99 per single-family home; $65 per apartment. Exemptions for low-income homeowners and seniors. Sunsets in 2045. | Implement wildfire prevention measures, including vegetation management. | $2.67 million in first year (2025–2026) |
City of Berkeley Emergency Response and Prevention (Measure FF, 2020) | 10-cent parcel tax. Exemptions for very low-income property owners. No expiration date. | Fund fire services, emergency response, 9-1-1 communication, hazard mitigation, and wildfire prevention. | $8.5 million annually |
Marin Wildfire Prevention Authority (Measure C, 2020) | County-wide 10-cent parcel tax. Exemptions for low-income seniors. Sunsets in 2030. | Support cross-jurisdictional, coordinated wildfire prevention, including early detection, warning and alerts, vegetation management, defensible space, and so on. | $20 million annually |
San Mateo County Local Funds for Local Needs (Measure K, 2016; renewal of 2012’s Measure A) | County-wide half-cent sales tax. Sunsets in 2043. | Support essential county services and maintain or replace critical facilities, with a focus on disaster preparedness, affordable housing, public health, public safety, parks, and other community services. | $115 million annually |
San Francisco Bay Clean Water, Pollution Prevention and Habitat Restoration (Measure AA, 2016) | Nine-county Bay Area $12 annual parcel tax. No exemptions for low-income residents or seniors. Sunsets in 2037. | Fund habitat restoration, flood protection, and shoreline access projects along the San Francisco Bay. | $25 million annually |
Local tax measures have become an essential but imperfect tool for funding resilience, as well as a variety of other critical infrastructure upgrades and services such as public transit, school improvements, housing, and homelessness solutions. They build buy-in, hold cities accountable, and ensure community alignment on priorities. But raising taxes in California is politically challenging — voters are generally resistant to new taxes, and state law requires a two-thirds supermajority to approve most local tax measures, a threshold that has proven difficult to meet.
Furthermore, reliance on local tax measures can deepen inequities between wealthier and lower-income jurisdictions. When push comes to shove, wealthier jurisdictions may be more willing to tax themselves than lower-income jurisdictions. Tax measures are typically regressive, meaning lower-income residents pay a higher proportion of their income to the tax. Although many of the measures offer exemptions for low-income residents, such as Marin’s Measure C and Oakland’s Measure MM, the resulting tax revenue may not meet funding needs if a large portion of a jurisdiction’s residents are considered low-income. Tax measures at the county and regional scale can be beneficial because they provide resource sharing between lower- and higher-income areas. For example, 27% of the revenue from Marin’s countywide parcel tax comes from higher-income San Rafael, and 6% of the revenue comes from lower-income West Marin, however the fund’s flexibility allows for additional funding to be spent in West Marin, where much of the wildfire risk is concentrated.
Beyond tax measures, local and regional bonds remain a cornerstone of hazard mitigation, particularly for seismic safety. Bonds enable governments to distribute the high upfront costs of major upgrades across decades, aligning repayment with long-term public benefit. In 2004, voters in Contra Costa, San Francisco, and Alameda counties approved Measure AA, authorizing a $980 million general obligation bond to fund most of BART’s $1.5 billion systemwide seismic improvements. Completed in 2024, the improvements received additional support from state and federal agencies, as well as from other local tax measures and private partners. Measure AA highlights that essential services — particularly lifeline infrastructure, such as transit — require financing mechanisms that can mobilize large sums (multi-millions to billions, rather than millions), a feat that is only possible with the cooperation of multiple jurisdictions.
San Francisco followed suit with its Earthquake Safety and Emergency Response bonds, approved in 2010, 2014, and 2020. Together, these measures funded upgrades to fire and police stations, the emergency firefighting water system, and new public safety facilities. The city also passed a $425 million bond in 2018 to strengthen the Embarcadero Seawall, integrating flood protection, seismic safety, and sea level rise planning into a single package.
The Challenge with Bonds. After the Los Angeles fires, S&P Global Ratings downgraded the credit rating of the LA Department of Water and Power, citing the rising severity of wildfires and climate risks. If the utility issues new bonds soon, it will pay higher interest rates to compensate buyers. This action marks a change in the municipal bond market that is likely to lead to more expensive borrowing in the long term — a change that may force cities to scale back or delay capital projects, something they also cannot afford with the rising costs of climate disasters. Tighter municipal debt limits and waning voter confidence in the efficiency of government spending could make it harder for local governments to pass voter-approved bonds for resilience investments and other critical needs.
The Tools We Need: Shared Financing Models
Despite progress, existing public financing tools remain insufficient to meet the accelerating scale of climate risk. Local governments need both new models and expanded partnerships to ensure resilience investments are equitable and effective. The question is not whether local governments can afford to invest in resilience — but whether they can afford not to. To share the burden and the benefits of reduced risk, Bay Area jurisdictions must work together to build new and strengthen existing investment vehicles that connect adaptation strategies to tangible public and private financial returns. Such vehicles will unlock participation from key partners who share in the outcomes, such as real estate developers, employers, utilities, insurers, and other investors. Without expanded funding, streamlined governance, and greater coordination, hazard mitigation and climate adaptation efforts will remain piecemeal, unsustainable, and insufficient.
With our partners across the region, SPUR is examining case studies and collaborating on equitable and effective financing and governance models for cross-jurisdictional, multi-hazard mitigation and climate adaptation. New financing structures must blend public, private, and philanthropic resources, and they must ensure that every community, regardless of wealth or geography, has the means to withstand what’s coming.