Financial constraints and short-term planning are linked to flood risk adaptation gaps in US cities

Adaptation is critical in reducing the inevitable impact of climate change. Here we study cities' adaptation to elevated flood risk by introducing a linguistic measure of adaptation extracted from financial disclosures of 431 US cities over 2013–2020. While cities with a higher flood risk have higher adaptation, more than half of high-risk cities have below-average adaptation levels. We explore three factors associated with this adaptation gap, defined as a city’s adaptation being lower than predicted based on flood risk. We do not find that Republican cities are more likely to have an adaptation gap. Instead, our results point to the importance of financial constraints: cities with one standard deviation smaller unrestricted-fund-to-expense ratio are 6.6% more likely to have an adaptation gap. We also provide evidence on the importance of long-term planning: cities with a planning horizon shorter by one year are 4% more likely to have an adaptation gap.