When representatives of the cities in the City Accelerator cohort on funding public infrastructure gathered in New Orleans last fall, who could have predicted that the political world would experience a seismic shift in two short weeks? The 2016 election shocked the world and shook the foundations of civic stability in unmeasurable ways. The aftershocks are still reverberating. As we pass April 1, 2017, many are still wondering whether the new reality is an extended April Fools’ joke or some sort of fever dream from which the nation might soon awaken. Dream on.
Whether you are for Trump or against Trump, it should have sunk in by now that Trump is the president of the United States and will be for some time to come. The "Age of Trump" promises to be different -- very different.
Soon, the infrastructure cohort cities will gather again in Washington, D.C., on April 27-28 to reassess the situation and report on the progress of finding new and innovative ways to facilitate the development and redevelopment of critical infrastructure. As it turns out, the promise of a new trillion dollar commitment to infrastructure by the Trump administration might seem like a stroke of prophetic good fortune. But like most political promises, the devil is in the details.
Among the details is the potential return of Build America Bonds (BABs), a financing mechanism used during the Obama administration and reportedly favored by President Trump. But, as Governing reported, BABs became subject to sequestration, creating an expensive financial bow wave for states and localities that used the program.
As we look forward to the next convening later this month, it is useful to look back at where the participating cities were last October.
St Paul reported on efforts to protect the headwaters of the Mississippi River by employing the benefits of green infrastructure. The community is addressing water pollution problems that commonly affect cities throughout the United States -- particularly industrial communities -- through new strategies. One strategy is to move away from individual stormwater facilities serving single land uses toward a "shared and stacked" design, which offers a more effective solution for multiple sites within a single watershed. The city discussed innovative methods to raise financial capital through cross-functional teams and new legal entities such as a "green infrastructure financing district."
San Francisco talked about a dual-draconian threat from its more than century-old seawall facing the near certainty of future earthquakes (72 percent probability of a major quake by 2044). In addition, the measurable sea level rise (12 to 24 inches by 2050) gives a third reason for serious concern. The price of addressing these potential disasters runs into the billions, but the cost of not anticipating and investing in preemptive mitigation is even more catastrophic.
Pittsburg described a more conventional infrastructure issue with an unconventional twist. The city, which one speaker described as "topographically challenged," is responsible for over 700 sets of mostly concrete steps. These steps provide a necessary means of mobility for the estimated 11 percent of the workforce that walks to work. The city has been budgeting approximately $400,000 per year to address this situation, which might cover the cost of renovating or replacing a single set of steps. The stairways are largely extensions of the city's sidewalk system and are constructed on public rights-of-way ... though some are not. In any case, it is a complex infrastructure problem that cannot be effectively ignored and begs for an innovative, long-term solution.
Washington, D.C., presented what has turned out to be perhaps the most prophetic and favorable opportunity: a more focused and intense study of how infrastructure finance might be addressed through public-private partnerships (P3s). Trump has identified such partnerships as a critical part of his trillion dollar program. Washington is quite possibly ahead of other jurisdictions in that it has set up a separate Office of Public-Private Partnerships and adopted specific legislation (DC Act 20-550, the Public Private Partnership Act of 2014). Projects underway include streetlight modernization, the development of a new correctional center (not intended to be a private prison) and renovation of the city's police headquarters. Those responsible for these initiatives have identified key challenges such as explaining or facilitating trust, fostering coordination and marketing, and not overselling the initial P3 undertakings.
Beyond the city-specific initiatives, the infrastructure group had wide-ranging discussions that informed their respective approaches, including the still ongoing multi-billion dollar response and rebuilding of New Orleans related to Hurricane Katrina. At the other end of a very different spectrum of need and necessity, the city of Atlanta is pursuing the refashioning of an old railroad line into a unique linear park -- the Atlanta BeltLine. This project is intended as a means of pedestrian and bicycle transportation, as well as a mechanism for sparking neighborhood revitalization. With an extreme economy of words, Atlanta captured the characteristics of what made its project work: 1. Think Big; 2. Include Everyone; 3. Promote Authenticity; 4. Compel Change; 5. Inspire Life; 6. Stay Focused; 7. Emphasize People; 8. Band Together.
Joseph Kane from the Brookings Institution talked about the federal role in infrastructure; Stephen Auton-Smith of Ernst and Young Infrastructure Advisors outlined new innovations in financing traditional projects; and Elizabeth Sawin of Climate Interactive told us we must ask "What if?" questions about the future. And remember, this was before anyone was really focused on the biggest question of all: What if the election doesn't go as expected? Furthermore ...
What if there is a major philosophical and political shift in the national culture when it comes to the federal role in local infrastructure needs and demands? What about Pittsburg's steps and the countless streets, sewers and bridges in other cities throughout the United States?
What if the Environmental Protection Agency is diminished and there is a turn away from climate protections that have been the accepted goals and guidelines for decades? What about St Paul's commitment to green infrastructure and protection of the headwaters of the Mississippi River?
What if there is an unwillingness to prepare for the most feared effects of climate change? What about San Francisco's seawall, and what could happen in other low-lying cities such as New Orleans, New York and Miami?
What if the national and world economy undergoes significant change as a result of a new emphasis on private financing of basic infrastructure (something that was previously considered to be a public responsibility)? What happens to the public portion of projects like the Atlanta BeltLine?
These and other such critical questions are still awaiting answers as the ideas and initiatives of the Trump agenda begin to unfold.
And so we convene again -- this time in the nation’s capital and in the strange new world of post-election America, or the “Age of Trump." Times have changed. It is unquestionably a time of great disruption -- even beyond politics and including the world of finance. But one great and potentially positive effect of such times is a renewed spirit of invention and a stronger focus and reliance on the necessity of innovation.
Perhaps there has never been a better time for City Accelerator.