SPI Insights

Guidance to consider and changes to recognize when collaborating with governmental entities

Here is something no one expected! Public officials throughout the country are struggling with the task of managing large amounts of federal funding currently flowing to them. The revenue is conditioned on rules, compliance, and often a requirement to submit an application to obtain the dollars. Most cities and counties have no systems in place or the resources available to oversee, comply with rules, and disburse such large volumes of funding quickly.

Excess of federal funding, rather than the traditional scarcity of revenue, is now the challenge. Public officials are also in a race against the clock because there is a deadline to use the new funding. This is a phenomenon that would have sounded implausible five years ago.

These non-traditional challenges are driving significant change. One noticeable change is that the new funding encourages innovation, collaboration, justification through data analysis, and visionary thinking in diverse ways.

City leaders in Milwaukee are drawing on community input and data collection to identify areas of infrastructural inequity. An allocation of $26 million will fund a project to remove old piping that is contaminating water supplies in parts of the city where health care has traditionally been lacking. An additional $7 million has been secured for building out sustainable, clean energy resources that will result in long term citizen benefits.

Smart city projects being funded are usually the result of data analysis that identifies problems. Often the issues to be rectified, along with justification for the expenditure of funds, involves technology. Data analysis is also necessary for planners who are responsible for vetting and prioritizing projects that offer the greatest impact to areas high need.

Another noticeable change is the emphasis on coordination with regional and federal counterparts and community organizations. High power costs led to a new system of LED streetlights in Chicago. The new streetlight poles are linked to smart-city sensors that will gather data for future planning initiatives, and the project is expected to save the city $100 million over the next decade. The city of Philadelphia is considering a similar project.

More government organization charts now list new executives with the title of Chief Innovation Officers (CIOs). These individuals who work with planners, procurement officials, and other staff to seek new ways to solve problems. In 2018, less than 30 municipalities were listed as having created Chief Innovation Officer roles. Today, it would be hard to find a large city without that type of executive role. In San Jose, California, the CIO controls a $34 million operating budget and has the support of 103 department employees.

In Pittsburgh, a master plan for smart city improvements describes a $29 million smart spines intelligent traffic flow system that will be installed in eight transit corridors throughout the city. Carnegie Mellon University’s lab for smart city innovations has partnered to identify areas of infrastructural inequity and will continue to work with the city as the project is launched this summer.

The connection to university innovation labs reflects one type of partnership that is becoming common. A large number of public officials and strategists are also currently working with Department of Energy labs to develop to launch innovative transportation solutions.

Local governments are expanding innovation through partnerships with private-sector organizations. The Permian Strategic Partnership (PSP) exists to foster innovation in a large region that extends across Texas and New Mexico. The PSP brings together 17 leading energy companies with community leaders to help guide and provide for the exceptional growth the region has experienced.

So, what is the takeaway for companies interested in partnering with government in the future?

Consider these suggestions:

• It is advisable to understand the adopted rules and spending criteria for the new federal funding.
• It is advisable to recognize the importance of technology and data gathering in new projects.
• Contractors should schedule meetings and find ways to build relationships with CIOs.
• Local partnerships are important and can often be forged with a university or a non-profit or community-oriented group.
• It is imperative for contractors to understand the importance of justifying cost allocations for any solutions and/or services.

We are experiencing an historic moment in time, and the new funding will afford us incredible opportunities to improve life for all citizens, create new jobs, improve equity and infrastructure, and boost the country’s economic vitality.