As we look toward 2050, our local governments' infrastructure needs are growing in complexity and cost.

Just as it took the automobile 50 years to dislodge the horse as an everyday mode of American transportation, smart city infrastructure over the last 30 years has moved from a collection of theoretical ideas about frontier technologies, to community-focused smart city solutions that better meet the needs of local stakeholders. 

A focus on smart city technologies makes it easier to identify relevant and available community solutions. State and local governments have an immediate need for more aggressive regional smart city infrastructure efforts, and independently established smart city programs guided by specialized management teams can meet this need.

These innovative program management teams prioritize community smart city infrastructure interests, creating a public-private stakeholder ecosystem necessary to design infrastructure solutions and structure fiscal resources that allow for rapid expansion of discrete smart city infrastructure projects. 

Local government control

The complexities and increasing costs of infrastructure projects are disproportionately borne by state and local governments. As of 2017, states and local governments owned 93% of non-defense public infrastructure assets. In spite of this, state and local governments have reduced overall infrastructure spending by 1% of national GDP over the last 50 years.

The results of dwindling infrastructure investments are clear. For instance, the American Society of Civil Engineers’ 2017 Infrastructure Report Card gave the country’s infrastructure an overall grade of “D+,” estimating the need for $2 trillion in additional investment over the next 10 years. 

Taxing restrictions, institutional capacity and existing obligations, such as unfunded pension liabilities, limit a state or local government’s ability to act as financial sponsor for infrastructure projects. With constrained resources, it can be difficult for state and local leaders to understand, prioritize and develop smart city infrastructure projects over traditional repairs. But now, more than ever, state and local governments must innovate fast and rethink their approach to developing smart city infrastructure. 

Smart city programs require an understanding of community needs and adaptable solutions to meet these needs. They also require a shared financial sponsorship with appropriate private capital partners to meet requirements. These parameters take time and resources to identify, foster and maintain. That is a challenge for state and local governments, which often struggle to move fast and adapt to rapidly changing environments. 

State and local government leaders should consider establishing a dedicated public-private partnership organization for smart cities, operated by an independent program management office (PMO)​ that has the authority to manage day-to-day responsibilities. The PMO could organize a variety of interested stakeholders around the goal of improving quality of life through smart city infrastructure. As the organization is independently established and operated, government’s responsibilities are reduced, and the PMO absorbs more of the risk for understanding, designing and developing smart city infrastructure.

With financial and staff capacity risk reduced or removed, state and local governments can better focus on the implementation of smart city infrastructure and its engagement with residents and visitors. 

The PMO as a smart city program enabler

The complexities of a smart cities infrastructure program require a team of closely collaborating professionals with deep expertise in operations, legal structures, project finance, technology and community engagement.

From strategic planning to asset recycling, many local governments primarily advance smart city initiatives through a series of RFPs. This approach enables financially constrained state and local governments to reduce their upfront costs, but re-enforces public administrative silos, inadvertently causing long-term harm.

There is no incentive for seemingly unrelated RFP awardees to collaborate and share historical learnings, which is necessary for achieving of overall smart city program goals. Slow and expensive public infrastructure projects draw the scrutiny of media and residents, thus increasing political risk and challenging long-term program success. 

The PMO serves as the single coordinating entity across all stakeholders and phases of the smart city initiative. The high-level of coordination facilitates more efficient infrastructure development. A better orchestrated social, financial and operational system allocates resources to the highest value smart city opportunities. 

Expansive community engagement is a unique feature of the PMO model, eliminating or significantly reducing the financial, political and social risks that discourage smart city infrastructure development.

Introducing these stakeholders early in the smart city planning process ensures that identified smart city infrastructure projects are the product of strong alignment and collaboration between residents, technical staff, government leaders and project financial sponsors. 

This collaborative PMO-led model achieves three objectives: it improves a local government’s understanding of various smart city technologies; attracts infrastructure sponsors to smart city projects, including smaller value projects that typically don’t fit within financial sponsor investment criteria; and allows for continuous, sustainable and people-focused value that makes smart city programs resilient.

Under the guidance of the PMO, the entire ecosystem of stakeholders is positioned to identify and develop smart city projects that meet the interests of an entire community, across all phases of the smart city infrastructure development process. 

Entering the age of a smarter city

The smart city ecosystem is complex, expensive and risky. Smart city infrastructure projects can overcome these innovation barriers by rethinking the program management approach.

Local government leaders have the ability and authority to establish special purpose, smart city-focused organizations today. With the innumerable benefits of smart city infrastructure and the growing state and local government funding gaps, these powers should be exercised promptly, as the resiliency of our local communities hangs in the balance.