Cities are shaking the infrastructure tree to find new funding

Facing growing challenges and static budgets, US cities are increasingly looking for ways to get more from their existing assets to save money and create new revenue which can be ploughed back into public services.

The topic came to the fore during a Cities Today virtual roundtable, with several digitalisation leaders inspired by recent moves in the market.

For example, the North Texas Innovation Alliance (NTXIA), a regional consortium of municipalities, agencies, companies and academic institutions, recently issued a call for solutions to monetise data and assets such as land, buildings, lighting and roads.

The call noted that: “New solutions and business models are emerging that give governments new avenues to partner with the private sector to deliver new or improved services or revenue streams.”

“A top priority for our membership is to focus on revenue-generating solutions and financial models that aid in economic recovery and propel transformative projects forward,” said Jennifer Sanders, Executive Director of NTXIA.

Elsewhere, New York City has committed US$157 million in capital investment and is making 100,000 city-owned assets available in what has been called a  “first in the nation” approach to closing the digital divide. As well as significantly increasing economic opportunity for all residents, the city says universal broadband will create a larger tax base, generating new revenue streams to support city operations and services. Further, cost savings could reach US$4.3 billion, driven by improvements in workflows, the ability to negotiate lower municipal rates for broadband services, and efficiencies in contract services management.

“We desperately want to be able to use our own assets in a similar way to grow the market [for connectivity] to serve the populace,” one CIO said.

For many cities, these new approaches prompt challenging legal questions and other complexities that still need to be worked out but it’s an area several are now digging deeper into to try and move ahead.

One delegate commented: “We’re interested in having a facilitated conversation to solicit that feedback from the market on what assets or units we are missing that we should be monetising, and which assets are ripe for use beyond what we already know.”

One asset, many benefits

A common piece of infrastructure on which to capitalise is street lighting due to its ubiquity.

Keith Chinchar, Vice President of Business Development – North America, CIMCON Lighting, outlined the wide range of options.

For example, cities are using energy cost savings from CIMCON’s smart lighting to fund programmes such as homeless shelters or mobility infrastructure. The company’s smart city platform can generate direct revenue through parking analytics or digital signage, while solutions such as air quality, flooding and road-temperature sensing deliver important quality of life benefits as well as cost efficiencies and indirect revenue. These systems also give cities new data on mobility, pedestrian flows and the environment to inform better decisions.

Chinchar urged cities to start with the desired outcomes and an audit of the “topology” of the city. He works with leaders to understand wide-ranging issues such as the fibre capability, long-term goals, technology options, and data and network ownership.

“You can’t be myopic in your decision-making and not think long-term,” he said. “All these things come into the conversation; it goes way beyond lighting.”

The City of Coral Gables, Florida, started its smart lighting programme by deploying 50 smart lighting controllers from CIMCON, among other energy management technologies throughout the city.

The city’s Sustainability Management Plan outlines a goal to cut energy consumption and overall greenhouse gas emissions by 20 percent by 2025, and a 13 percent reduction has already been achieved so far.

“The smart and LED lights help to achieve those goals,” said Raimundo Rodulfo, Director of Information Technology and Chief Innovation Officer, City of Coral Gables.

New Internet of Things (IoT) sensors, smart poles and lights are being installed and sensor data is reporting real-time pedestrian counts, vehicle traffic, waterway, and environmental data.

“That gives us new visibility,” said Rodulfo. “Now we have dashboards that are integrated to the smart city hub and we share that with colleagues and carry out analysis. It has been very positive.”

Building guardrails

Turning ‘dumb infrastructure’ into smart systems is also pushing cities to accelerate fundamental work around data governance and privacy.

Following controversy about data and privacy, the sensors on San Diego’s streetlights have been deactivated since September last year, and the city is developing an ordinance for data-gathering technologies.

Learning from this, cities said they are engaging with citizens through surveys and workshops, developing data privacy principles and including stipulations on data sharing, privacy and algorithm oversight into procurement contracts.

Image: Lukas Stoermer: Unsplash