How Can Revolving Loan Funds Make Our Coasts More Resilient?

This fact sheet explains how revolving loan funds (RLFs) can be used to finance coastal resilience and environmental improvements. It details the mechanics of RLFs, discusses federal legislative priorities like the STORM Act, and provides a detailed case study of the Maryland Shore Erosion Control Revolving Loan Fund alongside a feasibility study for a similar program in Puget Sound, Washington.

• Revolving loan funds (RLFs) are self-replenishing financing mechanisms that use a base of capital—often from grants or private investment—to issue loans. As borrowers repay the principal and interest, the capital is replenished and used for new loans, allowing the funds to operate for decades with minimal additional investment.
• RLFs are used across the United States for various environmental goals, including water infrastructure via the EPA's Clean Water and Drinking Water State Revolving Funds (established in 1987 and 1996), and energy efficiency, such as Texas's LoanSTAR program ($250 million in loans) and Nebraska's Dollar and Energy Savings Program (nearly 30,000 projects since 1990).
• Recent federal actions emphasize RLFs for disaster risk reduction. The Safeguarding Tomorrow through Ongoing Risk Mitigation (STORM) Act, passed January 1, 2021, enables FEMA to provide funds to tribal governments and states to create RLFs for hazard mitigation. Additionally, the House Select Committee on the Climate Crisis recommended a Natural Infrastructure Resilient Communities Revolving Loan Fund for municipalities to combat sea level rise and storms.
• The Maryland Shore Erosion Control (SEC) Revolving Loan Fund, established in 1970, provides zero-interest loans for 'living shoreline' projects. After shifting away from 'hard armor' like bulkheads, the program now requires non-structural stabilization under the 2008 Living Shoreline Protection Act. The fund has provided approximately 700 loans over 52 years, currently issuing 15 to 20 loans annually, and is sustained by repayments of $600,000 to $700,000 per year.
• In Puget Sound, Washington, a feasibility study is evaluating a proposed RLF to help homeowners replace 'hard armor' (which covers 29 percent of shorelines) with 'soft shore protection'. The proposed fund would cover armor removal, soft shore protection, structure relocation, and structure elevation. Costs vary significantly, from $10,000–$20,000 for armor removal to over $200,000 for moving a house.

APA

Environmental and Energy Study Institute (2021). How Can Revolving Loan Funds Make Our Coasts More Resilient? https://www.eesi.org/files/FactSheet_Revolving_Loan_Funds_and_Coastal_Resilience_2021.pdf

Chicago

Environmental and Energy Study Institute. How Can Revolving Loan Funds Make Our Coasts More Resilient? 2021. https://www.eesi.org/files/FactSheet_Revolving_Loan_Funds_and_Coastal_Resilience_2021.pdf.

Wikipedia

{{cite report |author=Environmental and Energy Study Institute |title=How Can Revolving Loan Funds Make Our Coasts More Resilient? |date=January 2021 |url=https://www.eesi.org/files/FactSheet_Revolving_Loan_Funds_and_Coastal_Resilience_2021.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{environmentalandenergystudyinstitute2021how, author = {{Environmental and Energy Study Institute}}, title = {{How Can Revolving Loan Funds Make Our Coasts More Resilient?}}, institution = {Environmental and Energy Study Institute}, year = {2021}, month = jan, url = {https://www.eesi.org/files/FactSheet_Revolving_Loan_Funds_and_Coastal_Resilience_2021.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }