"dollar for dollar" can mean that the price or value of one thing is proportionately related to the price or the value of another thing. Let me give you an example. You want to buy a used car which is advertised at $5,000, but you know the car needs new tires which will cost $250. So the seller says to you, "I will reduce the price on a dollar-for-dollar basis." This means that the seller will reduce the selling price of the car by one dollar for every dollar that you will have to spend for new tires. That is, since the new tires will cost you $250, the seller will reduce the price of the car by $250 ("dollar for dollar") to $4,750. The exact phrase you quoted is hard to understand without a context. But I'm pretty sure that it means that if some other event occurs which costs X dollars or reduces value by X dollars, the price will be reduced by X dollars.

Which part don't you understand?