Cities Look to Business (Not Washington) to Build Sustainability
Written by POLITICO MAGAZINE
When it comes to building cities to withstand the ravages of age, climate change and a rapidly evolving economy, America’s mayors have probably never felt more alone. They are dealing with the tangible effects of climate change but cannot depend on the federal government, which has just pulled the country out of Paris Accords and is rapidly unwinding environmental regulations on air and water quality. Increasingly, they find themselves at odds with state legislatures that preempt their authority to act locally. While welcoming the news from President Trump’s administration about a much ballyhooed $1 trillion infrastructure plan, mayors are facing mixed signals about how much money is likely to be kicked in by the federal government and how much cities will have to scrounge up from private entities. In the face of these challenges, how can cities make themselves more sustainable—and more resilient? When the solutions to the biggest problems facing modern society come with equally big price tags, how do mayors pay for them? And given competing financial priorities and a climate of partisan polarization, how do mayors convince their constituents that investing in a more sustainable city is the right thing to do? And, finally, given the limited regulatory jurisdiction, how do cities leverage other key players and resources?
POLITICO brought together mayors, policy and funding experts to consider these questions. In an on-the-record discussion moderated by POLITICO’s editorial director of events, Luiza Savage, and What Works editor, Bill Duryea, the group discussed the ways cities are promoting sustainability and building cities to accommodate population growth, withstand extreme weather, and fortify aging infrastructure. In order to encourage fee and frank conversation, comments were not attributed to individual participants.
Participants in the working group had first-hand experience in implementing a broad variety of sustainability initiatives. They included an energy-saving program that metered 61 buildings in an entire downtown; GPS-monitoring of asthma inhalers to identify hotspots of poor air quality; a bus rapid transit system that connects an existing train line to the downtown; and reserving a set percentage of bond issues to cover the cost of recycling, solar-electrification and LED lighting.
What follows are five strategies they identified for creating cities that are built to survive in the 21st century.
1. Selling Sustainability: Numbers tell the story
Mayors, like business owners, know that bottom lines matter. Sometimes the constituency that needs the most convincing is the business community itself. In cities, getting buy-in from major corporations and even small businesses is crucial to reducing the overall carbon footprint because it is often those companies—and the massive office buildings they inhabit—that are the biggest energy users.
There was a strong consensus in the working group that measuring and quantifying potential savings and improvements is the single most important step in getting private-sector buy-in for sustainability efforts.
“It was very important to show tangible results because if you’re a building manager and it costs $8,000 to put in a revolving door…is it worth the investment? Because it costs money to replace things but if you look at savings over time, the managers can make the case to their shareholders and their bosses that, yes, this is worth it. So measuring was key to our business community.”
Whether savings in energy or water usage, decreased insurance rates, or improved air quality, mayors said numbers make the case.
“How many jobs do you create with a $100 million project? Well, it’s 20 jobs per million dollars.”
Moreover, the seal-of-approval from respected third-party non-governmental organizations such as universities and non-profits can help improve the design or bolster credibility of a project at a time when trust in government and politicians is running low.
“We need to engage citizens on the ground—through groups they already trust, through leaders that they already trust, to think about what the solutions are.”
“You have to have that third-party independent verification because no one knows who the truth teller is anymore.”
Another constituency that often needs convincing is already inside city hall. Mayors know well the perils of siloed departments that might have different priorities about the most pressing issues to deal with. Identifying where various departments have overlapping interests is a good place to start when looking for projects that are worth doing. Success of sustainability projects requires buy-in from multiple government agencies.
“We sit down either with the mayor or sometimes it’s a public works director or a city engineer or something like that and we generally go through a series of questions and one of the first ones is: Where are you losing money now? Where do you expect your costs to increase in the future? If you were to give a speech about an infrastructure-related topic tomorrow, what would that speech be about?”
“We generally find that if you focus on where the city is losing money, and where it stands to lose more money in the future because of deferred maintenance, or climate change, rising insurance costs, whatever it happens to be, that tends to be a really good place to focus in any city.”
Mayors lean on the universities in their midst to help them find solutions, identify best practices, and make a public case for the merits of sustainability projects.
“We have 34 municipalities within our county. Rather than each of these municipalities having to create their own model for how you do data around issues of climate change, sustainability, housing, whatever it is, every city has a major research university associated with it. Think about how you can strategically partner with those institutions. And what the director of public housing has told me repeatedly is, ‘We rely on using the data, and the tools, and the innovations that you provide because it’s a cover. Because it’s not us doing the research and then saying, ‘We’re pushing this agenda.’ It’s the university as the supposed neutral third-party that doesn’t have a vested interest in whatever direction any kind of decision-making takes.”
2. Sustainability is Good Business: Making it pay for itself
Mayors, many of whom have come from the business community, have to fight against a well-worn political script that pits business interests against public health. The most successful projects marry economic benefits with sustainability — sometimes in surprising ways.
For example, in Hoboken, NJ, a for-profit underground parking garage was designed to act as a receptacle for stormwater during major floods like the one caused by Hurricane Sandy, thereby solving a daily parking problem and a major environmental hazard from sewer water contaminating nearby waterways.
“Even the non-sexy stuff, like combined sewer overflows, if you integrate the problem with other urgent problems—in Hoboken, parking is like the biggest issue—you can tie a combined sewer project with an urgent pain point for citizens.”
Similarly, businesses can be shown how a mass transit can affect their ability to attract and keep qualified workers—if the mayor can make the case that businesses operating in the same location have shared interests.
“Sixty percent of the people who work at the airport are from the city. But nobody’s had a conversation [with employers]. ‘Well, if you’re starting at 7 a.m. and you’re starting at 7:30 and you’re starting at 8 a.m., isn’t there some kind of way we could compromise and we get all of you to start your workers at 8 a.m. so that we could run a rapid bus system there?’’
Cities are not the same, so the economic case for sustainability won’t be the same either. Much as mayors like to borrow good ideas from each other, they know that light rail might work in a larger city, but not necessarily in a mid-size one where less expensive bus rapid transit might be a better fit.
“Eighty-five percent of the benefit of light rail at 18 cents on the dollar. So the business guy goes ‘yay.” The guy who wants government to be efficient goes ‘yay.’”
3. Sustainability and Resilience: Knowing the difference makes a difference
Sustainability focuses on the long-term management of natural resources can be a hard sell for mayors because it often requires spending today to addresses negative consequences in the future. By contrast, resilience investments focus on adapting to the increased threat from potentially catastrophic events – such as storms, floods, hurricanes, wildfires, and rising sea level — that are often more immediately visible and whose costs are spread across a broad range of city residents and businesses.
“We in South Florida no longer have an office of sustainability. We have an office of resiliency. The reason for that is that we are on the frontline of what the climate is doing to our cities…We understand that because of our location, because of our population densities and because of the way that we’ve made our cities in these locations, we are very vulnerable.”
But cities who have embraced resilience don’t spend a lot of time arguing who’s to blame for climate change. The reality is as evident as the water gushing from Miami Beach sewers on a day without rain. And it’s reflected in the practices of reinsurance companies – the institutions that manage financial risk for insurance companies, who are facing increased costs due to floods, storms, and sea level rise. These cities are focused on what to do about it.
“There was one of those classic ah-ha statements when the subcommittee task force chair asked [a reinsurer] ‘Well, how do we insure against sea level rising?’ He said, ‘We don’t. There’s no insurance against sea level rising because it is not an unpredictable event. It is a long-range change in the baseline condition that affects the events.’ And from that point forward, I think we stepped away from the debate about what’s happening and focused on what can we do?’”
Resilience infrastructure—such as the massive pumps installed by Miami Beach in its stormwater system to deal with street flooding during high tides—is becoming an infrastructure priority, particularly in coastal cities. Cities are looking for creative financing arrangements to cover the costs.
“We can’t just float revenue bonds or general obligation bonds. We’ve got to figure out another way: public-private partnerships, resilience bonds, and other ways because we need to build infrastructure if you live on the coast of the United States. We have to build long-range protections. Some of it, by the way, may be natural systems infrastructure. It all doesn’t have to be higher. Others, it has to be an investment. It may be something dealing with fires in the Southwest. But it is about figuring about how to pay for this infrastructure, which we have now assessed and studied because we need it to protect our community in the future.”
In some cases, cities are finding that money coming from those same reinsurance companies can be a source of funding for resilience infrastructure.
“[Reinsurers tell us] ‘half of our business is about taking the proceeds and profits of insurance and reinvesting them back into communities.’ They’re looking for places to make money. And they’re now looking at infrastructure as a place to make money. So we’re talking to them about resilience funders. About environmental impact.”
4. Redesigning cities: Undoing the problems created by zoning
Financing is not the only challenge facing sustainability initiatives. Mayors often face opposition from residents who resist change. Cities are coming to grips with the time bombs that were created by zoning policies that now make sustainability efforts even harder to implement.
“What are some of the reasons that we emit so much pollution? Is it the fact that we’re driving incredible amounts of distances because office settings are nowhere near shopping malls and are nowhere near cultural activities, which are nowhere near one type of housing or the other?”
“A lot of zoning at its essence was looking to not only segregate uses but also to segregate people, right? That was the unspoken truth of zoning and we should acknowledge that. And so today, we have zoning that is at the root of our problems because we know that on the one hand, cities between now and 2100 will be hosting over 65 percent of the world’s population, right? But at the same time, many of those cities are located in the most fragile of ecosystems.”
Well-established neighborhoods don’t always welcome changes—and they are often the most vocal opponents of initiatives that alter the landscape of a city. Participants in the working group recounted examples of “Not-in-My-Backyard” opposition can holding up or derailing sustainability projects, such as new bus lines.
“It’s NIMBY, right? ‘Nothing happens here. I moved here in 1978. I like my place the way it is. I don’t care if he has to drive or she has to drive this amount of time. I don’t care if they have to have a three-car family now instead of a one-car family because I don’t want the bus line going from my house.”
“Then the next person running for city council is going to show up at your neighborhood meeting and say, “Don’t worry. I’ll make sure nothing changes for you.” So we’re our own worst enemy, right? We tear each other down.
Meanwhile, city sustainability efforts must contend with the reality that environmental problems are often unequally distributed across communities. Poorer communities tend to be more exposed to nearby industry and the harmful of effects of poor air quality—higher rates of asthma, for example. Those same communities to end have less tree cover, making the neighborhoods hotter. And a lack of trees means there’s less natural filtering of pollutants.
“We asked for 1,000 volunteers. We call them citizen-scientists because it sounds cooler—that suffered from asthma to equip their emergency inhalers with a GPS device so we would know when and where they used their inhaler. We were able to produce a heat map of the city to understand where the most extreme areas of the city are per use of the inhalers. So we could one, communicate that, but then two, mitigate those areas with changing traffic flows, and introducing’ vegetative medicine’, which is in another way of saying trees.”
In some cases, environmental impacts themselves are driving a new socio-economic re-segregation. In Miami, for example, poorer, minority communities were historically pushed inland away from the valuable waterfront real estate. Today, on account of rising sea levels, those same inland neighborhoods, which happened to be on higher ground, are now more valuable and susceptible to land speculation. The availability of affordable housing is now shrinking in a trend dubbed “climate gentrification.” For mayors, climate change and affordable housing are not unrelated issues.
“A housing need and solution in Little Havana will be different from Miami Beach. So that’s a major project that we’re involved with. And we’re right now adding a flood data mapping tool, so that we can look at the intersections of housing affordability issues and sea level rise and flood data because it just so happens that, in Miami-Dade County, many of the higher elevated areas are also poor communities. And so there’s a lot of concern around climate gentrification.”
5. Working with Washington: What D.C. wants and what mayors need
Working group participants were uncertain whether the Trump administration’s talk of an infrastructure agenda would benefit their cities—or sustainability in particular.
Broadly speaking, participants said that making their cities greener is the right thing to do for the health of their citizens and their local economies. For example, the benefits of living in a city that doesn’t have a smog problem don’t just fall on the residents who are breathing cleaner air, but the companies that employ workers who take fewer sick days. Mass transit, if done with the input of affected industries, can be a game changer.
“To me, good business and good environmental practices are the same thing nowadays, so when I talk to companies, they know if they’re not responsible from an environmental standpoint, they’re not going to be able to attract the best employees.”
One of the paradoxes mayors face in dealing with the current administration, some participants said, is that making the business case for sustainability is sometimes difficult with policy makers who have fixed notions about what businesses need or a narrow view of infrastructure.
“[The administration] has asked us to think big in infrastructure and to come back and talk about it. But it’s kind of an exercise in imagination because I don’t know where the funding is going to come from. I only hear roads and bridges from the current White House. We’ve got to have transit, public transportation.”
Some participants expressed skepticism about Washington’s talk of infrastructure.
“Washington is a joke for cities right now. It’s just a lot of hot air, no results. It’s shocking to see what’s happened. I’m not an overly partisan person. But we are not having any kind of value-added discussions with the federal government.”
But others see opportunities to aggressively market their city’s needs in terms that align with the new administration’s agenda—to meet the administration “where they are,” as one mayor put it.
“What I did when I met with Trump was prepare a letter. Because when he talks about what he wants to do for urban environments, it’s fix the infrastructure of the cities. And so I explained to him that his letter speaks to what you say you want to do for cities: fixing infrastructure, creating an environment where we’re more energy efficient, where we don’t have to worry about our roads falling apart, and our pipes blowing up—and we’re [already] experiencing it.”