Here’s how New Jersey can capitalize on its best clean energy investment opportunities (Environmental Defense Fund)

Financial Tools

New Jersey can also make available financial tools that encourage private investment. Tools must be market-oriented: flexible and adaptable to react to market changes. At the same time, we need to envision at the outset ways to help low-to-moderate income households access efficiency and other clean energy upgrades.

  • Bonds – Green Bonds, Environmental Impact Bonds, and Qualified Energy Conservation Bonds are good tools for New Jersey to consider.
  • PACE – Property Assessed Clean Energy (PACE) legislation would allow the state to authorize commercial buildings to finance energy upgrades on their tax bill. PACE is a financing model that helps local governments and the private sector back energy efficiency and renewable energy upgrades for homes and businesses. Some states are even using PACE to give new life to historic buildings.
  • Community Solar – Community Solar projects benefit multiple home and business customers who don’t have the ability to install rooftop solar. The best community solar programs will include partnerships with local non-profits and community leaders, like we’re seeing in Los AngelesColorado, and North Carolina, for example.
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Resilience, Equity, and Innovation: The City Accelerator Guide to Urban Infrastructure Finance (Living Cities)

Every week seems to bring another report highlighting the crumbling state of America’s infrastructure, from lead poisonings in Flint, to levee breaches in Houston, and deteriorating transit systems in Washington, DC and New York.

City governments seeking to finance infrastructure projects face a legacy of past underinvestment, which can make improvements or rehabilitation more expensive. They also experience outdated mindsets and siloed and informal project development processes that can increase the challenges involved in solving financial gaps. And if that isn’t enough—cities are also confronted with the need to strengthen infrastructure against extreme weather and sea level rise.

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Funding Tomorrow's Inclusive Cities Today (Governing)

The following blog post is part of the City Accelerator initiative, a collaboration between Governing, the Citi Foundation and Living Cities that aims to speed the adoption of innovative local government projects within and across cities that will have a significant impact on the lives of their residents, especially those with low incomes.

It is time to retire the false choice.

Too often, we hear that you have to choose between fixing aging infrastructure, building resilience or mending inequity. Our experience with the latest group of participants in the City Accelerator initiative tells us that, in reality, sometimes you can have it all. By acting on these subjects together, local leaders can create capital budgets that better weather business cycles and climate change, consider avoided costs as a form of revenue to support investment choices, and bring future value to current residents by allowing them to benefit from increased jobs, incomes and wealth. Infrastructure development, done right, fosters economic and social impacts for low-income populations while building more stable financial strategies.

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New report: Unlocking Private Capital to Finance Sustainable Infrastructure (Environmental Defense Fund)

When two large storms knocked out an estimated $200 billion in economic value within a week, critical gaps in our infrastructure preparedness were laid bare. The 2016 “Hell or High Water” series from ProPublica and The Texas Tribune predicted a scenario that “visualizes the full spectrum of what awaits Houston” if it were hit by a large-scale hurricane. Experts consulted for the series cite Houston’s unimpeded development as a principal factor contributing to the region’s high exposure to flood risks.

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Massive Infrastructure Needs Require Creative Funding Approaches (Triple Pundit)

Municipal bonds have helped pay for some our country’s most iconic projects, including the Erie Canal and the Golden Gate Bridge. Today they help pay for the full spectrum of critical infrastructure, from schools, roads, and airports to hospitals, water systems, and affordable housing. But while municipal bonds have helped animate the growth of the United States for the past 200 years, to meet our nation’s infrastructure needs for the next 200 years, new financing tools are required.

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Two Cities Will Get Chance to Raise Money for Green Infrastructure (Next City)

Two more cities will soon issue EIBs for infrastructure projects (not just stormwater management) — and the investors could be you or me.

Which two cities exactly will be determined in a competition announced by Neighborly, a company with a platform that makes it easy for the public to invest directly in municipal bonds via the internet, and the Rockefeller Foundation’s 100 Resilient Cities initiative.

“We need new models and financing mechanisms to produce more jobs, create new opportunities and build more resilient cities,” said Neighborly CEO Jase Wilson, in a statement calling for cities to apply.

Eligible EIB proposals must geographically include one of the cities that are part of the 100 Resilient Cities network (regional authorities that include a city in the network may submit a proposal). Among other factors, proposals will be judged on impact, including environmental impact as well as benefits to poor and vulnerable communities; the financial strength of the issuing agency or government; the size of the proposed transaction ($5 million or greater is suggested); and the scalability of the proposed project and finance approach within the city or to other cities.

Proposals may also incorporate multiple projects and aspects of environmental impact, such as stormwater reduction, clean energy infrastructure, water conservation, or recycling and waste reduction.

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Growing infrastructure needs require new funding approaches (Bond Buyer)

By shifting the risk of innovative projects from public agencies to investors, the EIB model presents an opportunity for municipalities across the US to invest in better, cheaper, and more resilient infrastructure and environmental solutions, and funders are starting to pay attention. The Rockefeller Foundation recently issued Quantified Ventures a grant to offer our services pro bono to more cities through an EIB Challenge. Working with Neighborly, an online broker-dealer for municipal finance, the next EIBs will also be the first publicly marketed EIBs, allowing these cities to access a broader investor base. As the market for EIBs continues to grow, more state and local governments around the country can benefit from greater and easier investment in innovative projects.

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Startup Seeks Cities to Test Bonds that Put a Twist on Pay-for-Success (GovTech)

DC Water’s project, which involved using water-absorbing “green infrastructure” instead of tunnels to help avoid too much rainwater overwhelming the sewers, was a sort of trial balloon for the concept. In that instance, they issued the bond privately to Goldman Sachs and the Calvert Foundation.

In Neighborly’s project, the startup is looking to open up the bonds to a wider pool of purchasers. In fact, that’s what Neighborly was founded to do — the startup’s goal is to allow average people to buy municipal bonds. In the context of EIBs, then, people could use the platform to invest in environmental projects in their own cities and then earn a payback on it.

“The humble municipal bond is the original impact investment,” said Neighborly CEO Jase Wilson. “It’s been funding things like parks and schools and libraries since longer than that’s been a term.”

The Neighborly program isn’t limited to projects to absorb rainwater, either. In preliminary talks with cities, Wilson said he’s heard ideas ranging from sea walls to electricity microgrids.

“We don’t know what happens when we open the flood gates on the project, but it’s shown us that there’s a world of innovative projects waiting to be financed,” Wilson said.

And there are, potentially, a lot of areas where the project’s organizers think the model could work. Because the purpose of the EIB is to provide peace of mind through risk reduction, it could theoretically apply to any project where the government isn’t totally sure that the project would work.

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Quantified Ventures and Neighborly Launch Green Infrastructure and Resilience Challenge (CivSource)

Quantified Ventures and Neighborly have launched an Environmental Impact Bond (EIB) Challenge at the Mayors Innovation Project Summer Meeting in Burlington, Vermont. Quantified and Neighborly are joined in the challenge by support from The Rockefeller Foundation.

The challenge judges will choose two US cities or counties to issue the first publicly marketed EIBs. Proceeds from these bonds will be used to finance green infrastructure for stormwater management, or other projects aimed at building resilience for vulnerable or low-income communities. The winners will receive pro bono services in planning, structuring and marketing EIB issuances from Quantified Ventures and Neighborly.

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Climate Bonds Pioneered by Goldman Lure Storm-Plagued Cities (Bloomberg)

As climate change pushes U.S. cities to build protections against stronger storms and more frequent floods, the Rockefeller Foundation is helping cities with a novel kind of financing, one that transfers some of the risk of innovative projects from cities to investors.

The foundation, established with John D. Rockefeller’s oil wealth, announced Wednesday it will pay $342,000 to underwrite the costs for two municipalities in issuing environmental impact bonds, pioneered by The Goldman Sachs Group Inc. and Washington, D.C. More than a dozen cities have expressed interest in the bonds, which link an investor bonus or penalty to how well the underlying project works.

"You take the risk off the project not working" for city officials, said Saadia Madsbjerg, who leads the Rockefeller Foundation’s work on financial innovation. "There are many, many municipalities that have the exact same problem that D.C. has."

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