An Urbanist's End-of-Year Impact

This year I’m reflecting on different ways to gift and give back. By giving to an organization in someone’s honor, you are letting that person know you care about them and their values. It’s an easy and meaningful (and sustainable) way to gift this holiday season!

Take a look at some of my favorite philanthropies. These organizations are helping cities and communities thrive. I’ve cross-checked most of these with Charity Navigator and encourage you to do the same.

For Environmental Justice Warriors

• Share the Warmth Funds: help families pay for energy and heating bills, see if your utility has a neighbor assistance or share the warmth fund

• Climate Justice Resilience Fund: support women, youth, and Indigenous Peoples to create and share their own climate resilience solutions

• Groundswell International: strengthen capacity for healthy farming and food systems, also look to donate (and volunteer) with local food banks to promote food security

For City Lovers

• UNESCO Heritage Site: preserve world heritage sites

• Library Funds: support local civic life by donating to the library

• Local Arts and Science Programs: breathe more into your city by giving to local museums, science centers, performing arts groups, and more

For Eco-Activists

• Coalition for Rainforest Nations: stop deforestation globally

• Nature Conservancy: protect ecologically important lands and waters

• Natural Resources Defense Council: seek to protect air, land, and water

• Clean Energy Innovation: support clean energy research and advocacy

For Community Builders

• Rebuilding Together: a safe and healthy home for every person, find a regional chapter near you

• Bridges to Prosperity: connecting rural communities with infrastructure

• Ioby: community-led, community-based crowdfunding for livable neighborhoods 

There are many more places to give to! And, if you are looking to purchase gifts for friends and family, make sure to buy local this holiday season and shop at your neighborhood stores.

Biden and Building Better Cities

Over the last four year mayors from red and blue districts waited for an infrastructure bill that never came. During that time, local governments patiently saved for capital projects and ongoing infrastructure maintenance. But, COVID-19 redirected many of those funds and efforts. Now, these districts are in dire need of infrastructure support- from new roads and rehabbed bridges to energy grid updates and more expansive broadband systems.

Starting January 21st, Biden brought new hope for U.S. cities with his infrastructure vision. His administration will focus on job creation through building an EV charging network, promoting zero-emissions public transit, investing in renewable energy, and supporting new energy efficiency standards. These initiatives, and the associated funding, will be funneled into cities where local leadership has long been waiting for federal leadership. 

Wonder how this will happen? Biden has created an A-Team to address issues cities are facing throughout the country.

The Rebuilder: Michael Regan

To make sure the U.S. can meet it’s environmental obligations, Biden nominated Michael Regan, NC’s head of the Department of Environmental Quality (DEQ), to lead the Environmental Protection Agency (EPA). Regan’s work at DEQ went far beyond the country’s largest coal ash cleanup. He had the tough work of reversing the DEQ’s bad morale. This sets him up to take over an agency in desperate need of rebuilding and reconstruction. With past federal leadership on air quality and energy efficiency initiatives, you can look to Regan to:

• Reinstate auto emission regulations

• Chart a green power plan for the country

• Focus on environmental justice for poor and minority communities

The Industry Insider: Jennifer Granholm

A new report found that the U.S. will need to add 50 million electric vehicles, increase wind and solar investments, and expand transmission infrastructure by 60 percent in the next 10 years to reach net-zero emissions by 2050. Given that challenge who better to lead the charge than Jennifer Granholm? As Governor of Michigan, she oversaw the Great Recession’s impact on automakers and understands the need for the industry to evolve. Since transportation is the greatest source of pollution in the U.S., Biden’s green energy plans will push automakers faster towards an electric vehicle future. But, Granholm’s experience is broader still. Previously as Governor, she set aggressive energy goals and disrupted the development of coal-fired power plants. You will see her:

• Push for electric vehicle sales to increase beyond 2% per year

• Advance clean energy research and implement an Advanced Research Projects Agency on climate solutions

• Expedite renewable energy projects

The Policy Wonk: Pete Buttigieg

During his 2020 presidential bid, Buttigieg put together a comprehensive infrastructure plan that spoke to his unique understanding of what cities need. Buttigieg was one of the first mayors to sign up with LimeBike and he oversaw a $21 million effort to build street projects as a means of economic revitalization. As a true policy wonk, Buttigieg will propose and defend some technical solutions to grand problems. With an insolvent Highway Trust Fund, underfunded transit systems, a growing new mobility field (AV, micromobility, etc.), and a floundering air transportation industry, this is probably the best place for him to be. Look forward to seeing proposals that:

• Replace the gas tax with VMT tax to address the dwindling Highway Trust Fund

• Focus on Vision Zero programs to eliminate traffic fatalities

• Connect rural to urban core with new technology and infrastructure

The Advocate: Marcia Fudge

We are heading into one of the most difficult periods of American housing reform. Before COVID-19, nearly 21 million households were rent burdened. Now, 30 to 40 million Americans could face evictions as moratoriums end. This has put immense pressure on programs from the Department of Housing and Urban Development (HUD), programs that cities heavily depend on. Marcia Fudge, Biden’s Secretary of HUD and once a mayor herself, might be new to housing policy but she is no stranger to the struggles low-income households face. During her time in Congress, she worked extensively on food and nutrition policies. Most recently, her opposition to restrictions on food stamp and the SNAP program helped protect nearly 700,000 Americans from poverty and hunger. Be on the lookout for policies that will aim to:

• Reduce the racial wealth gap through homeownership programs for minorities

• Make disaster recovery more efficient

• Extend FHA’s foreclosure and eviction moratorium

Essential Services means Rural Broadband as well

Prior to COVID-19, only 17% of Americans worked from home. Now, 44% of Americans are navigating the new work-life normal from home. As we jump between Zoom meetings, join online classrooms, and VPN into local networks, internet speed and availability has become a necessity. If the internet goes down, productivity crashes. Over these last months, many have called for intense infrastructure investment to protect against internet outages. But, for a good portion of the United States, these realities are not just recent. 

The Urban-Rural Digital Divide

The Telecommunications Act of 1996 requires that the FCC take immediate action to ensure all Americans have broadband internet service in a reasonable and timely fashion. Accomplishing this goal requires metrics. The FCC has set a benchmark of 25 Mbps download and an upload speed of 3 Mbps. While urban internet service has shown steady increases including a 10% jump to 90.5% between 2014 and 2016, rural service has remained flat at 70%. This has left 14 million Americans without minimum internet speeds. When the internet fails in urban areas, there are redundancies- like the free wi-fi at the corner Starbucks or mobile data- that can keep up productivity. But, in rural areas, lack of internet access has far reaching implications. 

Rural areas that suffer from low internet service also face health access issues. 88.2% of rural counties in the US are medically underserved. In these areas, telemedicine is a vital service, connecting rural residents to physicians and medical specialists. During a pandemic, that service is priceless. This has made public internet access in libraries and municipal buildings a critical part of rural communities. On top of health and education and quality of life needs, broadband internet has become a large part of rural industry growth. Precision agriculture and digital agriculture technologies, dependent on broadband access, could create over $47 billion a year by optimizing yield and lowering environmental impact. Without internet access, ⅓ of those gains are lost.

Broadband and Health Access

The ISP Giants Aren’t Serving Rural Communities

Despite the ongoing and critical need for rural broadband, internet service providers (like ComCast, Time Warner Cable, and many others) continue to shy away from providing internet service. Capital costs to install broadband infrastructure in rural areas is high because of lack of customer density. Deloitte reported that $150 billion of investment is needed for capital costs to modernize rural broadband. To replace ISP service in low density areas, rural communities depend on mobile data which is limiting, frequency internet that relies on short distances and clear paths between buildings, and internet satellites vulnerable to bad weather.

To bring internet to rural communities, the FCC and USDA have rolled out two funding programs: Universal Service Fund and Rural Utilities Service, respectively. Together, these programs provide over $700 million a year to rural connectivity projects. Understanding that rural connectivity is increasingly important during COVID-19, the US federal government allocated an additional $500 million for rural broadband in the CARES Act this year. 

Patchwork Solutions for Rural Internet Access

Many municipalities have vied for government dollars to provide better service for their residents. Over 750 municipalities from Wilson, North Carolina to Seattle, Washington have created their own broadband services, providing a cheaper option to private sector counterparts. Despite this success, ISPs have lobbied to prevent municipal broadband competition. As a result, there are 22 states with regulations against municipal broadband, such as competition barriers and direct sale prohibitions. 

Outside of government funding and support, private companies continue to pour money into rural internet service. These include small scale ventures that outfit school buses with Wi-Fi hotspots to support students with roaming internet service. Even Silicon Valley giants have jumped into rural internet service. Alphabet’s Loon service has partnered with Vodacom to provide service in Mozambique via internet balloons. And, SpaceX has sent over 775 Starlink satellites into orbit to begin providing nearly 700,000 US residents with internet service. 

COVID-19 continues to challenge the ways we live our lives. For cities to move beyond these patchwork solutions, there must be some serious investment in broadband internet infrastructure. Before long, mobile providers will be launching 5G plans to get us more data faster. Even that might not be enough to propel our new normal across the urban-rural digital divide.

Read the original blog at Infrashares.com.

Green Infrastructure can do it all... if only we let it

For years, FEMA has been criticized for deflating flood risk to prevent insurance rates from skyrocketing. In late June, First Street published a new report exposing hidden flood risk throughout the United States. Compared to FEMA risk data, First Street identified millions of additional properties at risk of flood damage. For example, FEMA’s report shows that only .5% of properties in Los Angeles are at risk for flooding. First Street’s analysis says this number is closer to 12%. This should come as no surprise if you’ve been tracking the increase and intensification of climate events. Further, properties facing flood risk are increasingly vulnerable because of aging and undersized grey infrastructure. This infrastructure was originally sized to collect and reroute stormwater away from properties. But, over the years, storm intensity has overwhelmed stormwater infrastructure.

Shifting from Grey to Green Infrastructure

In 1987, the Clean Water Act was amended to promote the use of green infrastructure to better manage stormwater runoff and flooding. Green infrastructure is defined as “… the range of measures that use plant or soil systems, permeable pavement or other permeable surfaces or substrates, stormwater harvest and reuse, or landscaping to store, infiltrate, or evapotranspirate stormwater and reduce flows to sewer systems or to surface waters.” This isn’t as technical as it sounds. Green infrastructure is any infrastructure that sinks, slows, and reuses stormwater runoff, like rain gardens, wetlands, green roofs, detention tanks, and creek restoration.

Green infrastructure can extend the life of grey infrastructure by reducing stress to stormwater pipes. It is also more cost effective than grey infrastructure, saving millions in construction costs. Philadelphia’s city-wide Green City, Clean Waters program is projected to save the city $8 billion over a 25-year implementation period. And, Chicago’s Green Alley Program is estimated to manage stormwater 3-6 times more effectively per dollar than conventional grey infrastructure. Another source of cost savings comes from reduced energy use with green roofs and tree plantings that can cast shade and temper urban climates. On top of this, green infrastructure creates jobs and provides public health benefits. For example, Ontario’s green infrastructure sector has created more than 120,000 jobs.

Despite the benefits of green infrastructure and the need for nearly 800 communities to reduce stormwater runoff under the Clean Water Act, green infrastructure is still a novelty for many. Without having the technical expertise to design and maintain green infrastructure, municipalities fall back on conventional grey infrastructure. To make the shift toward green infrastructure requires new incentives and structures that value community health and well-being… enter green infrastructure investments.

Financing a Better, Cleaner, and Healthier Future

Like many infrastructure assets, green infrastructure assets have social and environmental value that is difficult to quantify. New financing structures are finding ways to capture that value as indirect revenue sources. Research from the University of Texas estimates that property values can increase up to 20% with abutting or fronting parks. With this logic, tax incremental financing has been used to front the cost of green infrastructure. Incremental tax increases from rising property values can be captured to pay back initial construction costs. Similarly, property assessed clean energy (PACE) financing has been applied to green infrastructure, to be repaid by an annual assessment on property taxes.

Increasing green space, not only increases property values, it also decreases stormwater runoff and that indirect benefit can be quantified in flood insurance premiums and stormwater credits. To capture these multiple indirect value streams, cities and other infrastructure and property developers have issued their own green bonds. And, the idea of a water fund has been floated to ensure a revolving stream of investment towards green infrastructure for the purposes of clean water.

Realizing the Local Benefits of Green Infrastructure

Local communities directly benefit from green infrastructure and realize the costs of not installing green infrastructure. This is highlighted with First Street’s new flood risk map. Empowered to make local changes, one neighborhood in Portland used green infrastructure to revitalize the community. Living Cully is a grassroots program that builds parks and gardens as a way to create local wealth and reduce displacement. Through tremendous community engagement, Cully, Portland has become a rogue ecodistrict that has provided health benefits, created new jobs, and constructed green streetscapes that improved pedestrian safety. Harnessing the grassroots nature of this green infrastructure revolution, Living Cully turned towards crowdfunding.

But, Cully’s approach should not be unique. Crowdfunding has an opportunity to realize the local, social, and environmental value of green infrastructure. Communities can use crowdfunding, outside of traditional means, to finance and fund the delivery of better infrastructure, infrastructure that can be enjoyed by all and effectively reduce flood risks.

Read the original blog at InfraShares.com.

Infrastructure Disrupted: New Business Models for America's Oldest Assets

The public investment and ownership model for infrastructure assets isn’t working anymore. As the infrastructure funding gap increases, it’s time for us to find and invest in new business models for constructing and maintaining key infrastructure assets. This means looking for new revenue streams and rethinking life cycle costs. We often think about private investment models and public-private partnerships as solutions. But, there are a spectrum of options.

Just as companies have stepped up to innovate around materials and technologies, there are companies innovating around business models. These business models are set up to overcome the many obstacles of investing in infrastructure. Those obstacles start with infrastructure’s complex life cycle with many different stakeholders. The legacy and ‘lock in’ nature of infrastructure systems make them necessary and natural monopolies. And, on top of all that, there are external, difficult to value, externalities of infrastructure systems. To overcome these obstacles, companies are stepping in to disrupt and break down these issues.

This is most commonly seen in the transportation sector, where Uber and Bird have flipped the “last mile” problem on its head. No longer is the solution about extending public transit systems or improving pedestrian infrastructure. These companies are monetizing the idea of transportation as a service (TaaS)- pay as you use it. The pervasiveness of these companies is having huge effects on the transport sector. Estimates project that TaaS could save families $5,600/year and reduce the global fleet from 247 million in 2020 to 44 million in 2030. This new paradigm is creating opportunities for every infrastructure sector to innovate and unlock capital.

We’ve gone ahead and highlighted a few of these models. You’ll be surprised to learn that while the private sector is playing a big part in this, the public sector has played a key role to incentive investments in new business models.

Zero down commitments:

One of the biggest barriers to infrastructure investment is the high capital costs. We’ve seen many energy companies finance themselves to reap huge benefits in building more efficient energy networks. Solar companies, like SolarCity, enter into long-term operational contracts with customers. They install solar panels on buildings for a relatively low cost and reap the pay-back through monthly utility bills. Since the efficiency of these panels is greater than the utility service, the customer sees a lower energy bill and the installer is still making a return. Los Angeles’ PACE program incentivizes these services by allowing homeowners to install without any upfront costs. And, other localities have leveraged this model to bring in private investment to install LEDs in public lighting and lower their own operational costs with very little upfront costs.

Credits galore:

Credits are being used to solve the problem of valuing infrastructure’s external impacts. The most common kind of infrastructure-related credits are carbon credits. Companies who produce too much carbon can buy credits from “low carbon” companies. This model is the basis of Washington, DC’s Stormwater Retention Credit (SRC) program. Projects that reduce stormwater runoff can earn credits and sell those to projects that have too much stormwater runoff. From here, a new market is created, where investors can buy and sell credits to improve the return for projects. Leading the front, Prudential invested $1.7 million in District Stormwater LLC and is helping property owners install green improvements for free in exchange for retention credits.

Rain gardens built by District Stormwater, LLC

Going, going,… gone!

Typically, infrastructure assets are permanent. Choosing where that infrastructure is located becomes contentious and can lead to costly predevelopment processes. Reverse auctioning takes a new approach and let’s residents decide where distributed infrastructure should be sited. In Cincinnati, residents got to decide how much they would need to be paid to have a water basin located on their property. Then, the local government determined where the lowest cost and the highest environmental benefit would be. Those selected for a water basin were paid what they stated during the reverse auction.

Capturing new value:

When taxes don’t pay for infrastructure, we usually see user fees pop-up. But, what if there was another way to capture improved value? Improving infrastructure has an indirect effect on property values (and hence property taxes). The Santa Ana River Watershed established a Enhanced Infrastructure Financing District that collects revenues from the incremental increase of property taxes. This is more commonly referred to as tax increment financing and has been used widely by quasi-government entities like Business Improvement Districts.

For Rent:

Other infrastructure companies are leveraging growth in circular economy companies which are projected to boost economic growth by 4% and introduce 200,000 jobs by 2030. Instead of thinking about purchasing space, materials, and equipment, these companies are creating products for the built environment that can be reduced, reused, and recycled. In the spirit of the circular economy, Solvitect is repurposing rooftops and parking lots to implement energy and (storm) water solutions. As Solvitect is, in effect, renting these spaces, others have established online marketplaces for renting out materials and equipment in the built environment.

But, how do we continue to rethink these business models? Because of infrastructure’s legacy within the public sector, the government has set rules for how these systems are constructed, maintained, and financed. In many cases, the government needs to establish new policies, in effect sparking and building private investors interest and confidence. In 2017, DOEE rolled out a Price Lock Program and Aggregator Startup Grants to do just this. Other localities are following suit.

Interested in learning more? Check out my original article at InfraShares.com.