As world leaders gather at COP27, climate action is making international headlines. At home in the US, temperatures are warming faster than the global average, and by some accounts, in order for the nation to reach net zero by 2050, the country would have to reduce emissions by 6% per year. On August 16, 2022, President Biden signed the Inflation Reduction Act (IRA), which the White House called “the most aggressive action on tackling the climate crisis in American history,” with a goal to reduce carbon emissions by roughly 40% by 2030.
As our nation moves forward implementing this historic legislation, it is critical that we remain focused not just on the macro issues related to global climate change, but also on the unequal impacts of climate change on “frontline communities,” typically low-income communities of color that often experience the first and worst impacts from natural disasters caused by climate change, and which often are the least equipped to recover. A focus on frontline communities reveals a truly local disaster impacting communities across the US, and how climate change is deepening social and economic inequality.
Natural disasters are increasing in frequency and severity, and in disaster after disaster we see the same story: low-income communities of color are hit hardest, and have a more difficult time recovering. Years later, data show how disasters exacerbated poverty, homelessness, and worsened public health outcomes. Earlier this year, Hurricane Ian ravaged parts of Florida and several of the hardest-hit counties had poverty rates higher than the national average. Just prior to Ian, Hurricane Fiona hit Puerto Rico and left more than 200,000 households without access to clean running water, and many hospitals were entirely shut down.
At issue is the combined impact of increasing instances of natural disasters, frontline communities experiencing the deepest impacts, and a national housing crisis. Moody’s Analytics reports a shortfall of about 1.5 million housing units in the US and, according to the National Low Income Housing Coalition, there is a shortage of about seven million units of low-cost housing. It is more imperative than ever that states, counties, and cities look strategically at the needs of their frontline communities, assess their potential risk of natural disaster, and at the same time evaluate their needs relating to investing in housing, community health, and both physical and social infrastructure for the communities most vulnerable.
The American Rescue Plan Act made $19.5 billion available to state and local governments in flexible funds, and now the IRA includes $60 billion for environmental justice in disadvantaged communities. These funds will be allocated in grants for neighborhood access and transportation equity, environmental and climate justice block grants for activities like community-led air and other pollution monitoring, investments in low- and zero-emission and resilient technologies, workforce development that helps reduce greenhouse gas emissions, and facilitating engagement of disadvantaged communities. Funds may be used for important purposes, such as addressing air pollution in schools, whole house energy-saving retrofits, climate resilience of affordable housing, increase in energy credits for solar and wind facilities placed in service in connection with low-income communities, and funds for addressing racial equity within the US Department of Agriculture.
The question remains: Can governments use the IRA funds strategically to build physical, social, and economic resilience for the communities that need it most? It is also critical that states and local governments, as well as organizations and agencies focused on issues like affordable housing, public health, community development, poverty alleviation, and local economic development work together seamlessly to maximize the impact of the IRA investments and ensure equitable outcomes.
Guidehouse is a national leader in partnering with state and local governments to develop effective approaches to our most pressing problems. In addition, Guidehouse has invested heavily in subject matter expertise for solutions relating to climate change, disaster recovery, public health, and affordable housing. We are working with dozens of state and local governments to address the combination of factors facing their communities.
An effective approach to using the IRA funds in a way that can truly aid frontline communities starts with a multifaceted needs assessment, a strategic partnership approach across departments, a data-informed set of interventions, and a framework for evaluating impacts and adjusting the approach based on collected data. Some issues to consider include:
Climate change, and the resulting natural disasters, play a significant role in the growing poverty and inequality that affect frontline communities. The IRA has the potential to bolster the economy and resiliency of communities all over the US. Guidehouse has built the cross-practice approach necessary to collaborate with our clients to make sure that the climate actions resulting from the IRA focus on uplifting those communities most in need first.
Read more about how Guidehouse can help state and local governments maximize the impact of the IRA.
Gregory Heller is a Director in Public Sustainability who focuses on housing and community solutions. Other contributors to this article are Christina Moore and Andrea Gonzalez.
 https://www.moodysanalytics.com/-/media/article/2021/Overcoming-the-Nations-Housing-Supply-Shortage.pdf; https://nlihc.org/gap