Funding what tomorrow’s cities should be

By George D. Thomas | June 11, 2018

Poor, inadequate transportation is at the heart of many urban problems. In stop-and-go traffic in the United States, trucks lose as much as $28 million each year, just in operating costs and wasted fuel. Outdated traffic-signal timing on major urban routes has been estimated to account for more than 10 percent of all traffic delays. And the USDOT has said that as much as 30 percent of traffic in urban areas is caused by people simply looking for places to park their cars.

There's another reason to make transit a priority in our urban development plans: it addresses some important ways that access and opportunity are tied to wealth. Researchers at Harvard University are conducting a large, continuing study of upward mobility. Their findings suggest that commuting time, along with education and the area in which people live, is one of the strongest indicators of one’s chances of escaping poverty. The longer the commute, the worse the chances that low-income families will be able to move up the compensation ladder.

American and Canadian federal governments recently chose to “incentivize” infrastructure financing. They organized competitions, awarding (and in some cases, matching) funds to entrants with the best plans for using them. This opened up the process to a very different scope of ideas, customized to address local issues, but recognizing the urgent need for cities to step up and meet the future, too.

Using its USDOT Smart City seed money as leverage, Columbus raised an additional $500 million from local businesses and organizations, with a goal of reaching $1 billion by 2020. Other cities found private-sector support for their initiatives too, some adding to the federal award money they also had received.

The Investing-in-Canada plan launched in 2016, committing C$14.4 billion to upgrade public transit and social infrastructure. Another $81.2 billion was added in 2017 to help fund five priority infrastructure streams, one of which was public transit. As part of this larger initiative, Canada’s Smart Cities Challenge invited applicants to propose a smart program or service to improve the lives of residents through innovation, data, and technology. Twenty communities across Canada have now been shortlisted to receive funds and develop detailed proposals to move them to the next phase of the evaluation.

The US challenge had one big winner; Canada is announcing winners at different funding levels. Still, most of the cities that submitted even unsuccessful applications say the exercise was worthwhile. Preparing the paperwork and going through the public-consultation process raised awareness of their smart-city initiatives, and they advanced their plans that way.

Cost and risk considerations mean big infrastructure will probably always need government funds to get off the ground. But with city building—especially smart-city building—money is just the beginning. These projects need more sustained support if they are to deliver real results and drive the kind of change today’s cities need to become and remain sustainable in the future.

Funds and management must be transferrable. Upper-level government (federal or provincial/state) funding and its control must be given to the regional or municipal governments best able to use or manage them. Infrastructure planning and financing must be intentionally separated from political impacts or a specific government’s term-of-office.

Programs must be outcomes-based. Ongoing support has to be conditional on the program doing what it said it would and getting the results it promised.

Programs must be strategic, but with clear, small steps that drive incremental, provable value. Given the pace at which technologies, the funding cycles, and the political cycles all change, cities must adapt to identify, seed, incubate, and drive winning solutions. And they should be able to consistently tie individual projects to overall program objectives and measurements.

The plan must build in-house capability and expertise. No smart city program should ever be siloed, declining into failure because the people championing it leave or are reassigned. Knowledge and know-how must be transferred to those in the trenches and perpetuated by them.

The results must be sustainable by municipalities and their residents. Initial funding by upper levels of government should be the catalyst that helps the program become strong enough to keep delivering results after the grant money is spent.

It is always a difficult task to fund innovation, especially when using public funds. Investing in new capabilities using disruptive technologies should be carefully managed. Globally, smart city programs are solving for what citizens want and need today, and planning for what they will need in the future. It is also clear that higher levels of government want to, and do, encourage good city building; that they want to fund what’s needed to support it and sustain it. And, if programs show a clear vision of the future, of what cities should become and what they really need to be, the funding does fall into place.