Three Ways to Make Equitable Investments a Reality for Frontline Communities
By Sonum Nerurkar
New, bold commitments for “equitable investments” are proliferating the country. In Washington State, a 2021 climate act requires the state to dedicate 35% of generated revenue to directly benefit pollution-burdened communities and fund tribal nation-sponsored projects. In New York, a 2019 climate law commits 40% of all climate and clean energy investments to marginalized communities. In 2021, the Biden Administration established a similar federal-level pledge. Known as Justice40, the commitment states that at least 40% of federal climate investments go directly to frontline communities most affected by poverty and pollution.
Photo Credit: TONL
These are huge and necessary steps. But we also know that what is committed can often mismatch what happens. So, how can these investment programs be truly equitable? How can an initiative like Justice40 actually become a reality? And how do we ensure that necessary investments do not detract from pollution reduction goals in frontline communities?
To ensure that investments are designed to make an impact in frontline communities, a recent report from UCLA’s Center for Innovation – Making Justice40 a Reality for Frontline Communities – recommends three critical steps for decision-makers:
Clearly identify whom and where to target pollution reduction and investments through community partnerships and screening tools
Without a clear definition and tools to identify where most impacted communities are located, reductions in pollution burden and investments will not go to those who need them. Past experiences tell us that it is higher-income households that benefit most from climate subsidies and tax incentives.
One way to clearly identify whom and where to target is to establish and codify definitions of “disadvantaged communities” in legislation. While the official term may vary depending on the region, this helps provide accountability to ensure the right communities will benefit.
“Disadvantaged communities” has been defined with various levels of specificity in New York, Washington, Virginia, New Mexico, and California, often done in partnership with frontline communities. For example, New York created a climate justice working group, including representatives from environmental justice communities, a public comment process, and an annual review process based on the latest data to determine who and what areas would be included. Laws that define and protect disadvantaged communities are most effective at reducing existing pollution and preventing new polluting industries in already overburdened communities. This is what New Jersey did in 2020 with their landmark Environmental Justice Law, which prevents new and renewed permits for polluting industries in communities with cumulatively and disproportionately high environmental burdens.
Identifying impacted communities in an equitable and reliable way relies on clear data and screening tools. Studies show that the strongest screening tools will look at a holistic suite of risk and vulnerability indicators, such as geographies based on pollution exposure, health burdens, and socioeconomic vulnerability. Comprehensive examples such as EPA’s Environmental Justice Screening (EJ Screen) Tool, Maryland’s EJScreen, and CalEPA’s EnviroScreen tool have been used to track progress on and target funding for pollution reduction goals.
However, not everything can be captured by numbers. While strong screening tools can be used to understand resource disparities, they do not portray on-the-ground concerns in real time. They are also not designed to identify root causes and effects of community inequities – a critical gap that requires the involvement of frontline communities.
2. Integrate frontline communities as key decision-makers
Communities on the frontlines of climate impacts are also at the frontlines of climate solutions. They are best positioned to assess on-the-ground conditions, especially in our ever-changing climate, and identify local priorities. Their involvement is absolutely critical to ensuring accountability and reducing pollution, as well as the success of any equitable investment program.
Through an executive order, Virginia created a Council on Environmental Justice, made up of community organizers, local leaders, and activists, to provide recommendations on existing state policies, permits, programs, and procedures. Illinois created a similar environmental justice working group and managed to codify their authority in law, which enables the council to stay consistent and reliable in the face of political change.
In order for these committees, councils, and working groups to be successful, they must be provided the authority to shift and change policies to address issues in overburdened communities and direct where investments go. Building power for those that are directly impacted is key to sustaining change for an equitable future.
3. Ensure direct investments result in real impact
The emphasis on direct investments cannot be overstated. Far too often, money is directed into programs that claim broad “benefits for all” yet hardly change conditions for those who need it most. Pollution is reduced for high- and middle-income neighborhoods, while little changes for polluted low-income communities. Such overpromises are not only inequitable, but they also erode trust between policymakers and frontline communities.
To ensure that frontline communities see a real impact, we must prioritize policies and investments that will directly result in improved outcomes. This means reducing health-damaging pollution at the source, resulting in reduced asthma rates and premature deaths. It means policies and investments that produce and expand clean public transit routes for isolated communities. It means economic development programs and resources for workers affected by the transition to a clean economy to find family-supporting careers. It means better roads, housing, and infrastructure that can withstand flooding as well as reliable and affordable access to AC for the most vulnerable during a heatwave.
It does not mean the “trickle-down” or “spillover” effects of policies and investments made in one area of the city for the entire city – such as marginal improvements to air quality by the uptake of electric vehicles or rooftop solar in wealthy neighborhoods.
States like California and Washington have specified “direct benefits” in their commitments to ensure that frontline communities see investments upfront. Though not without criticism, this level of specificity is a valuable first step to ensuring real impact from “equitable investment” programs.
Commitments such as Justice40 present unprecedented opportunities to maximize restorative investments and address the long history of uneven resources and federal funding in frontline communities. Direct investments, community-led decision-making, and screening tools that center equity will be paramount for directing funds to the right projects and advancing durable policies that lower pollution burden in frontline communities. Though certainly not the only step, making equitable investments a reality will certainly be a big step towards a just transition.
To learn more, please visit www.thejustice40.com for resources, toolkits, and ways to get involved.
Sonum Nerurkar is the federal strategist at the Equity Fund.
