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A Bigger Bang for the Infrastructure Buck

The new federal money will go a lot further if communities pursue shared services and cross-jurisdictional solutions. Federal rules should be written to encourage bold regional experimentation.

The Vineyard Surface Treatment Plant under construction in Sacramento, Calif.
(Balfour Beatty Infrastructure, Inc.)
Last year, the Civic Federation uncovered some surprising information: Despite the official U.S. Census Bureau tally of 6,918 for the number of local governments in Illinois (already the highest number of any state), the actual number was 8,923. The reaction was shock … followed by a yawn.

Fixing something as gargantuan as the historically inefficient structure of local government is overwhelming, especially amid a pandemic. Even if there were a reliable baseline of standardized financial reporting — and there is not — administrative consolidation of single-purpose functions such as water utilities or park districts won’t automatically get us closer to the real goal: the improved bang for the taxpayer’s buck that only large-scale cross-jurisdictional coordination of services and investments can produce.

My experience working with local governments has taught me that they are brimming with innovative ideas but stymied by existing structures. While the Chicago region’s Metropolitan Mayors Caucus has documented that 95 percent of its municipalities have seen tangible benefits from cross-border shared services for emergency dispatch, joint purchasing and more, large-scale service sharing remains the exception rather than the rule.

Why is this moment ripe for deeper innovation in delivering public services? A struggling economy coupled with expanded federal resources create a tantalizing opening. But with local governments stretched incredibly thin, some tasty incentives are needed to attract more participants around the table of coordinated investments.

Consider some of the laudable areas where the Biden administration has made big bets in the Infrastructure Investment and Jobs Act: electrification of municipal fleets, replacement of lead pipes and universal broadband access. The potential impacts — slowing global warming, improving public health and spurring growth of small businesses — are enormous. And calculable.

But if every municipality and county has to navigate technical specifications and complex procurements on its own, administrative costs will gobble up too much of the economic benefits for residents. Before federal dollars are distributed through traditional mechanisms, we’d be wise to pause and define the outcomes we must achieve: Is it acceptable, for example, for transit fleets to transition from diesel to electric by 2040? Or do climate imperatives demand that we get there by 2030 (as Los Angeles has pledged) and even sooner in communities burdened by environmental racism? What would that take?

Defining the regional outcomes we want, such as cleaner drinking water and air clearer of diesel fumes, will help guide the actions we need to take. Identifying those desired outcomes also will help to overcome the all-too-human preoccupation with “loss aversion”: It’s often easier to put a price on a loss than on a future gain, and we know that fears of diminished local control are one of the biggest barriers to large-scale sharing of services.

Flipping this requires intentionality. It means retooling federal agency timelines and guidelines to introduce far greater flexibility in how infrastructure dollars are deployed. It means designing rewards for more efficient regional service delivery while safeguarding affordability and equity.

To empower local officials, a new Brookings Federal Infrastructure Hub is like a decoder ring for the new infrastructure law. Brookings Metro experts have tallied 115 programs, subprograms and set-asides with $1 billion or more in funding — each.

As a Kansas City regional leader recently put it, “America turns cartwheels” for competitive grants. If new grant guidelines were to offer 25 percent additional funding for communities that choose to work across borders to expand broadband or replace toxic lead pipes, we’d see back flips, with a twist.

Since most of the rules guiding the disbursement of the new and expanded federal infrastructure funding have yet to be written, it’s not too late to encourage bold experimentation. So if a community wants to work with its neighbors to scale up investments that simultaneously decrease costly flooding, clean up contaminated land and strengthen their smart grid, they should be financially encouraged to do so. If that requires the Federal Emergency Management Agency (FEMA), the Environmental Protection Agency (EPA) and the Department of Energy to design a joint grant application, let’s get to work.

Meaningful monetary incentives for cross-border collaboration and for coordinated, targeted investments would reward our public-sector leaders as they demolish silos and stretch their shared decision-making muscles.

The prize is within reach: Better-coordinated public services. Cost savings that can be plowed into improved services. And a more competitive, sustainable and equitable future for all.

MarySue Barrett is a nonresident senior fellow with Brookings Metro, advising on unlocking the transformative potential of the federal infrastructure package. She recently concluded 25 years as president of the independent Metropolitan Planning Council in Chicago. Earlier in her career, she served as chief of policy to Chicago Mayor Richard M. Daley.

Governing’s opinion columns reflect the views of their authors and not necessarily those of Governing’s editors or management.
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