BOSTON, April 8, 2025 – As municipalities and other public entities face rising costs from storms, fires, and extreme weather events, Ceres today released new guidance on how state and local governments can integrate resilience planning with climate risk disclosure to address these challenges.
The report, "Leading with Transparency: A Guide to Strengthening Climate Disclosure and Resilience in the Municipal Bond Market" provides a comprehensive framework for how public sector organizations can better inform investors on their climate risks and plans to address these risks. The report also highlights best practices from leading U.S. municipalities enhancing their climate risk reporting. Some highlights include:
Miami-Dade County Water: Their 2024 Official Statement for Water Revenue Bonds includes comprehensive disclosure of climate risks and adaptation efforts, detailing how the county is addressing threats through its Sea Level Rise Strategy and other initiatives.
City of Boston: Boston's Series 2023 General Obligation bonds provide transparent disclosure about the city's exposure to rising sea levels and coastal flooding, along with detailed information on the Climate Ready Boston initiative that addresses these risks.
Seattle City Light: Seattle City Light’s 2023 Audited Financial Statements clearly acknowledge hydro risk due to changing weather patterns, explaining how snowpack levels, springtime snowmelt timing, run-off, and rainfall directly impact their operations.
DC Water: DC Water’s ESG+R Report follows the Task Force on Climate-related Financial Disclosures (TCFD) framework, providing a comprehensive overview of governance, strategy, risk management, and metrics related to climate resilience.
City of New Orleans: The city’s Annual Comprehensive Financial Report highlights climate action planning and resilience initiatives, including their goal to achieve carbon neutrality by 2050.
"State and local governments are on the front lines of climate change, but current disclosure of these risks in the $4 trillion municipal bond market remains inconsistent and inadequate," said Steven Rothstein, Managing Director of the Ceres Accelerator for Sustainable Capital Markets, Ceres. "As extreme weather events threaten infrastructure, property values, and government, revenues climate disclosure is an opportunity for municipal, county, and state governments to be better prepared to meet these risks.”
The report comes in the wake of recent climate-related municipal bond defaults and credit downgrades, including those following the Los Angeles wildfires where S&P downgraded bonds due to concerns about future climate risks. Rising sea levels, hurricanes, floods, wildfires, and extreme heat increasingly threaten municipal revenues while creating significant adaptation costs. Forecasts predict that climate adaptation projects will drive a doubling of municipal debt issuance over the next decade, making transparent disclosure even more critical for municipalities seeking to fund resilience investments.
Ceres framework outlines a layered approach to municipal climate risk disclosure and resilience planning, recommending specific practices for:
Financial Statements - Including material climate risks in financial statements and following evolving global disclosure standards
Bond Issuance Documents - Providing comprehensive disclosure of climate risks, past weather events, and resilience strategies
Climate Action Reporting - Publishing standalone reports based on established climate disclosure frameworks.
Climate Resilience Planning - Developing robust adaptation plans as a necessary precursor to effective disclosure
About Ceres Accelerator for Sustainable Capital Markets
The Ceres Accelerator for Sustainable Capital Markets is a center within Ceres that aims to improve the practices and policies that govern capital markets by engaging federal and state regulators, financial institutions, investors, and corporate boards to act on climate risk as a systemic financial risk. For more information, visit ceres.org/accelerator.