Summary

Closing critical gaps across the interconnected ecosystem that supports discoveries in science and technology (S&T), developing discoveries into promising inventions, and commercializing inventions into thriving businesses should be of top priority for federal policymakers. In brief,  intentional focus and dedicating resources to discovery and commercialization of inventions ensures that the United States maintains and expands its economic vitality, its global leadership in S&T innovation, and its strategic entrepreneurial advantages. This proposal presents a rationale and vision for the launch and deployment of a national plan—called Innovate the Future: The American Inventors Initiative—to provide comprehensive support and acceleration paths for postdoctoral researchers, early-stage entrepreneurs, and S&T investors, in order to advance domestic economic growth.

Summary

The federal government can directly address the massive market failures at the center of our healthcare enterprise by establishing a new Health Advanced Research Projects Agency (HARPA)¹ modeled after the Defense Advanced Research Projects Agency (DARPA)—the agency the Department of Defense uses to build new capabilities for national defense.

The need for HARPA is twofold. First, developing treatments for disease is difficult and time consuming. HARPA will provide the sustained drive needed to push through challenges and achieve medical breakthroughs by building new platform technologies. Second, the U.S. healthcare system largely relies on the private sector to leverage national investments in basic research and develop commercially available treatments and cures. This model means that diseases for which investments are risky or downstream profit potential is low are often ignored. HARPA will step in where private companies do not, addressing market failures with direct investments that ensure that all patients have hope for a brighter future.

HARPA will leverage existing basic science research programs supported by taxpayer dollars, as well as the efforts of the private sector, to develop new capabilities for disease prevention, detection, and treatment and overcome the bottlenecks that have historically limited progress. To do this, we have to think and act differently about how we address human health challenges. HARPA would support research that directly affirms, refutes, or otherwise changes current clinical practice. It would do this using milestone-driven, time-limited contracts as the central mechanism for driving innovation. This will ensure efficiency, transparency, and optimize success.

Challenge and Opportunity

Every year, the United States spends more than $3.4 trillion on healthcare and tens of billions of dollars on biomedical research. Yet we only have treatments for around 500 of the approximately 10,000 known human diseases.² 30 million people in the United States—half of whom are children—suffer from a rare disease for which no treatment has yet been developed.³ There are no ongoing efforts to develop treatments or cures for the overwhelming majority of these diseases. That massive market failure is the big secret of the biomedical research enterprise and is simply unacceptable. We need bold action to correct this massive market failure and revolutionize how we attack disease.

In 1958, the United States created the Defense Advanced Research Projects Agency (DARPA) at the Department of Defense. This new government agency was designed to make pivotal investments in breakthrough technologies for national security and directly address market failures that were impeding innovation. The establishment of DARPA launched a new era in defense innovation that led to countless innovations, including the Internet, stealth aircraft, GPS-based precision navigation, night vision, autonomous vehicles, speech recognition, and robotic prostheses.

We need to take the same aggressive entrepreneurial approach to health innovation as we have in protecting our nation from foreign threats. Creating a new Health Advanced Research Projects Agency (HARPA) would fundamentally transform the way the United States approaches treating the majority of human diseases, and would directly address many of the shortcomings of our healthcare and biomedical research systems.

Imagine being able to predict and intervene before someone has a mental health crisis; diagnose cancers at their earliest stages when treatments are most effective; end deaths from antibiotic-resistant bacterial infections; and provide treatments for rare genetic diseases. That is the promise of HARPA.

By applying the same tools that DARPA uses to develop new capabilities for defense (Section 3), HARPA would be engineered to close the gap between basic research and real-world needs. HARPA initiatives would target the diseases that affect millions of Americans but are going unaddressed because of risk aversion and short-term, perverse incentives in academia and the private sector. These initiatives would be funded through large milestone-driven timeline limited contracts needed to take on transformational projects, and would be led by top experts recruited for focused stints at the agency. The result will be an institution designed from the ground up to finally solve the most pressing healthcare issues of our time: skyrocketing drug prices, the tragic shortcomings of our mental-health support systems, the opioid crisis, unconscionable waiting lists for organ donations, medical errors, and many more. DARPA enabled the United States to lead the world when it comes to defense innovation. HARPA will do the same for healthcare.

Function

Federal funding for medical research is primarily allocated though the National Institutes of Health (NIH). Through its $41 billion annual budget, NIH funds basic science and clinical research through grants. Grants are typically awarded to individual projects at academic institutions. Collectively, these projects form the bedrock of our knowledge about biology, health, medicine, and disease.

Importantly, NIH is not designed to develop marketable disease treatments or cures or to develop new platform technologies that are intended to revolutionize medicine. NIH funding is used to support therapeutic and technology development, but not in a way that prioritizes quick, efficient commercialization of new discoveries. Moreover, NIH does not include a mechanism for ensuring commercialization. SBIR grants flail at the challenge of commercializing innovations with woefully inadequate funding. Simply put, the current path from NIH-funded basic science to applied research to viable commercial product is too slow, and it does not address massive market failures that define health research and development today, leaving many human diseases without dedicated efforts to uncover solutions. Funds for basic science and clinical research through grants—awarded to academic institutions that pursue particular, individual interests in discovery—are great for uncovering truths about biology, but are an extremely inefficient way to drive toward therapies that make their way into the clinic.

Private companies, on the other hand, only scale up and market economically viable therapies. Therapies that are potentially effective but have a limited market remain inaccessible to the public at large or come with astronomical price tags that patients simply cannot afford.

Effectively bringing new innovations to the market requires alternative approaches to the bottom-up grant funding common to NIH programs. Again, this is not to say that the NIH dollars are poorly spent. The dollars spent on research are essential to understanding health and disease. But an alternative model is needed to advance research toward the development of necessary technologies and treatments to cure disease.

HARPA would close these gaps. Just as NIH brings federal resources to bear on basic science and early-stage research, HARPA would bring federal resources to bear on applied science and later-stage development and deployment. HARPA would have three guiding functions:

1. Launch and manage large-scale health-research initiatives. Although multiple federal entities⁴ work on health research, there is little coordination among these entities regarding research priorities, activities, or progress. HARPA would work with these entities—as well as with the private sector, academia, and states and localities—to launch and carry out targeted, multi-stakeholder research initiatives aimed at our most pressing underserved health challenges. Using milestone driven and timeline limited funding contracts, HARPA will be able to ensure rapid continuous progress. These initiatives would integrate the diverse capabilities of participating institutions to make real progress on persistent and pressing health problems.
2. Invest in transformational platform technologies. HARPA’s focus will be on projects that have direct impact on clinical care. Basic science tends to advance methodologically and incrementally. This partly reflects the nature of the field (one set of experiments informs the next) and partly reflects the nature of incentives in academia (moving too far and too fast away from an established knowledge base decreases the likelihood of publishable findings). By contrast, HARPA will only support transformative research that will substantially improve clinical practice and this is how potential impacts will be evaluated. Pushing for such platform technology breakthroughs is a high-risk, high-reward enterprise. HARPA will focus on the uncertain but potentially transformational medical technologies and therapies that tend to go underfunded today.
3. Support development of treatments and cures for all diseases. All taxpayers contribute to federally funded medical research. But not all taxpayers reap the benefits. Relying on the private sector to bridge the gap between basic research and commercially available products means that those with rare or difficult-to- treat diseases are often ignored. HARPA will correct this market failure by supporting development of treatments and cures for all diseases—especially those that are being neglected by the existing healthcare ecosystem.

Structure

HARPA would be modeled on DARPA. DARPA is considered the “gold standard” for innovation and accountability within the federal government. DARPA is also distinct from other federal agencies that fund research and development in that it is focused on building capabilities rather than simply advancing knowledge. This unique mission requires DARPA to have a unique set of attributes and operating principles, including the following:

• Contracts large enough to provide a critical mass of funding. While most federal grants for academic research are on the order of tens to hundreds of thousands of dollars annually, DARPA funds projects at $1–$5 million per year. These large contracts enable DARPA affiliates to pursue goals that would simply be out of reach at lower funding levels.
• Minimal bureaucracy. DARPA’s entire staff consists of about 220 government employees. This includes DARPA’s ~100 program managers (PMs), who collectively oversee about 250 research & development projects funded at total of about $3 billion per year. All actual research and development activities are conducted by public, private, and academic affiliates. DARPA’s small staff size and flat organizational hierarchy makes the agency effective and nimble, able to move quickly on priority issues in a limited amount of time. Moreover, the fact that DARPA is not organized around disciplines allows PMs to pursue unconventional but productive cross-disciplinary collaborations.
• No entitled constituencies. While funding from other federal grant programs may only be accessible to certain recipient classes (e.g., academic institutions), DARPA does not predetermine which types of institutions are eligible for funding. Funding projects at a wide variety of institutions—including universities, national labs, public and private companies, state and local government agencies— enables DARPA to access the full breadth of talent, expertise, ideas, and resources that the nation has to offer. For example, DARPA funding in the start- up community has yielded advances that may have been difficult or impossible to achieve in other sectors. DARPA uses flexible procurement tools like “Other Transaction Authority” to make it easy for small businesses and nontraditional defense contractors to participate in the agency’s initiatives.
• “Portfolio approach” to high-risk, high-reward efforts. DARPA understands and accepts that frequent failure is the price of success when it comes to achieving transformational breakthroughs. DARPA PMs have the resources and authority to invest in multiple approaches to a given goal. DARPA proposals are openly competed, but PMs can strategically select the winners in a way that creates a diversified, risk-mitigating project portfolio.
• Government control of contracts. DARPA negotiates contracts that enable control over performance. Contracts specify milestones and “go/no-go” decision points to ensure that scientific progress is made in an efficient and timely manner. This enables PMs to better manage funded projects and to cut funding if a project is not yielding desired results.
• Top-notch talent. DARPA attracts world-class PMs recruited from academia, industry, and government agencies. DARPA benefits from expedited direct hiring authority for science and engineering experts.
• High turnover. PMs are hired for limited stints (generally 3–5 years), and there are no career PMs. This approach keeps DARPA talent fresh—ensuring that the agency is scientifically current and flexible to new avenues of investigation—and fuels an urgency for PMs to “achieve success in less time than might be considered reasonable in a conventional setting.”⁵

Many, if not all, of these characteristics could be carried over to HARPA. HARPA could also adopt DARPA’s funding-management model. Under this model, all funding allocations would be left to the discretion of the HARPA Director while all funding oversight would be entrusted to HARPA PMs. Funds would be awarded as milestone- driven contracts that give PMs the capacity for early termination if a particular project is not yielding desired results. This almost never happens with traditional federal grants for research and development.

Because HARPA will differ in structure and function from traditional research-funding agencies, it is sensible for HARPA to have a reporting chain of command separate from NIH. We believe that HARPA would be best situated directly under the Secretary of Health and Human Services (HHS) or under the HHS Assistant Secretary for Health. The Biomedical Advanced Research and Development Authority (BARDA) provides precedent for placement directly under the Assistant Secretary for Preparedness and Response.⁶

Path to Establishment

HARPA could be established under existing authorities, but, ideally, would be established through authorizing legislation and new appropriations. There are several steps the federal policymakers could take to kick-start the establishment process. First, the president could issue a Memorandum or Executive Order directing the HHS Secretary to develop a blueprint for HARPA’s establishment as well as a strategic plan for HARPA’s activities. These documents would include identification of priorities and goals; analysis of global markets, policies and production capabilities; structure and accountability; and initial funding recommendations. Ideally, they would be developed by a short-term Federal Advisory Committee (FAC)—comprised of top physicians, health researchers, and innovative thought leaders. It is important that the FAC include avenues for external input, including providing and promoting a public comments period and convening stakeholder for a across the country. After these documents are developed, the president could urge Congress to deliver a bill establishing HARPA.

Alternatively, the President could include funds for HARPA in an annual budget proposal under the Assistant Secretary for Health or Assistant Secretary for Preparedness and Response. (If Congress appropriates those dollars, HARPA could be established without authorizing legislation.⁷) We believe that a minimum budget of $100 million for HARPA in its first year and $300 million in its second year would be sufficient to get the agency started and to establish high-impact programs, but to be truly transformational, the agency should ramp up to several billion in research expenditures annually. Throughout this process, the president should use high-profile speeches and events to publicly explain the need for HARPA, and to advocate for its creation.

Vision

With a DARPA-inspired structure, HARPA would achieve rapid translation of biomedical discoveries into patient-care capabilities. HARPA’s mission and activities would be synergistic—not duplicative or competitive—with existing federal research efforts. In particular, HARPA would use fundamental scientific understanding developed with NIH support as a foundation for developing breakthrough medical advances.

HARPA would operate in a health ecosystem that includes biotechnology, pharmaceutical, and healthcare companies, venture capital and philanthropy, academic institutions, and government and regulatory agencies. HARPA would address two of the most prominent shortcomings of this ecosystem: (1) the aversion to failure that limits the willingness of academics and the private sector to pursue high-risk, high-reward projects, and (2) profit incentives that limit the willingness of the private sector to develop therapies for rare or difficult-to-treat diseases. HARPA would provide the capital and supportive, focused research environment needed for experts from all sectors to demonstrate “proof of principle” for various medical innovations. In doing so, HARPA will drive explosive growth in the number of technologies, treatments, and cures that cross the so-called “valley of death” separating lab-scale insights from commercially available products.

HARPA would focus on developing transformational technologies that fundamentally change the way we do health research and deliver care. By focusing on the development of tools and technologies to transform the way we approach diseases, HARPA can establish mechanisms that ensure wellness and curing disease are prioritized, while correcting the perverse incentives in the market that limit the country’s ability to receive treatment.

There is a rich history of under-funding the development of such technologies even though they are often quickly engrained into the healthcare enterprise, making it difficult to imagine life without them. They enable breakthroughs that even inventors did not anticipate, create entire new fields of research, and often result in Nobel Prizes. They establish jumping-off points and serve as accelerants for progress. Such work is typically high-risk, high-reward and aims to build transformative capabilities rather than incremental discovery-based research that is commonly funded by the NIH. While NIH does a tremendous job of funding basic science and clinical research, HARPA will build new capabilities on the foundation that agencies like NIH and the Department of Veterans Affairs establish through their funding.

For instance, HARPA could drive the following:

• Technologies that allow clinicians to identify and quantify every protein in a drop of blood, completely transforming disease diagnosis, health monitoring, and care.
• A next-generation diagnostic imaging machine that makes it possible to detect a myriad of diseases at much earlier stages that is substantially cheaper, higher-resolution, and more portable than current MRI machines enabling broader use.
• A cortical eye prosthesis that communicates directly with the brain, making it possible to restore sight to the 7 million individuals (including 160,000 veterans)living with a visual disability in the United States.
• New classes of antibiotics to fight the enormous international public-health andeconomic threat posed by antibiotic-resistant bacteria.
• A series of clinical trials for the most expensive marketed drugs, aimed atdeveloping alternative treatment regimens to improve outcomes by reducing toxicities while dramatically reducing treatment costs. Such de-escalation studies of marketed oncology drugs have been shown to improve outcomes and dramatically reduce costs to save billions of dollars.
• A massive effort to repurpose already approved drugs for new applications. There have only been about 2,400 drugs ever been approved for use in humans. Exploring new applications of drugs that are already known to be safe and effective—instead of only focusing on creation of new drugs—could save billions of dollars on research and development and uncover novel uses for drugs that are already known to be safe and effective for other indications.

Beyond Health

It has not escaped our notice that the same market and institutional failures that created the valley of death and need for DARPA and HARPA exist in other areas of research and development. Our nation is facing unprecedented challenges associated with climate change and the need to provide a better world for all. We feel strongly that the federal government should establish additional Advanced Research Projects Agencies (ARPAs) to complement the efforts of other federal agencies and the private sector. Doing so would enable the government to take a leadership position in tackling monumental challenges.

We believe that, in addition to HARPA, the nation needs to establish capabilities in agriculture (AgARPA), the environment (EnARPA), and transportation/infrastructure (TARPA). Fleshing out the details for establishing each of these entities should fall upon the White House Office of Science and Technology Policy in coordination with the Office of Management and Budget, the President’s Council of Advisors on Science and Technology (PCAST), and the leadership of the appropriate federal agencies. Creating these new capabilities will kickstart new industries, create the jobs of the future, and improve our ability to be better stewards of the Earth. Without them, the nation risks continuing its piecemeal approach to addressing our most pressing challenges, while slipping further behind other nations investing heavily in innovations aimed at solving these global challenges. Establishing ARPA capabilities across the federal government would create a network of forward-thinking agencies prepared to address intractable challenges, while building an extraordinary, lasting legacy.

Summary

Internet-based disinformation operations have infiltrated the universe of political communications in the United States. American politics and elections carry major implications for the national and global economy, as well as for diplomatic relations conducted by and with the United States. As a result, the United States is a major target for politically charged propaganda promulgated by both foreign and domestic actors. This paper presents a two-part approach to countering internet-based disinformation.

Summary

Mass digitization of U.S. biodiversity collections would position the nation to achieve massive advances in the life sciences—a leap forward on par with the way that DNA technology transformed genomics at the start of the 21st century. This heritage consists of hundreds of millions of dry, wet, and otherwise preserved specimens in U.S. museums and other collections, including plant germplasm, microbial cultures, non-human biomedical samples (e.g., parasites), fossils, and other plant and animal samples. This proposal presents actions for the Biden-Harris Administration to take to catalyze this advance to pave the way for a sustained, coordinated effort to mass digitize the physical specimens in U.S. biodiversity collections (and their associated metadata).

Summary

The Biden-Harris Administration should pursue a set of policies aimed at maximizing productive use of the radio spectrum, a key public good that can be used to create economic and social value. These policies should include adjustments to the institutions that manage the nation’s spectrum; a redefinition of spectrum rights and responsibilities enjoyed by companies that use the spectrum; and options for using the economic value created by spectrum auctions to address persistent public problems.

Summary

Today, cities across the United States face significant challenges. The future of economic growth is uncertain. Community leaders struggle to make overburdened transportation and energy systems more resilient to climate change, while workers grapple with the impacts of automation on jobs. First responders are stretched too thin as they react quickly to public-safety needs such as natural disasters.

An emerging set of smart-city technologies from industry and university labs offer communities tools to help address these challenges. Smart-city programs deploy sensors, networks, and data analysis to expand economic opportunities for citizens and make communities more resilient. While smart-city technologies are not panaceas for urban challenges, they can enable communities to move more quickly and cost- effectively in addressing some of their most difficult obstacles.

But smart-city technologies are not yet being used to their full advantage. In particular, small-and medium-sized cities lack the resources, networks, and investor appeal that has enabled larger cities to race ahead in implementing and scaling such technologies. Federal support is needed now to help advance smart-city technologies in underserved communities, helping all Americans to succeed and thrive.

To achieve this goal, federal policymakers should convene representatives of cities, industries, universities, and federal agencies to identify obstacles to adopting smart-city technologies and to identify gaps where the federal government can provide additional support. This group should be tasked with developing a National Smart Community Strategy to be carried out through a coordinated interagency effort. The Strategy should include a mix of short-, medium-, and long-term goals and actions, such as:

• Short-term: Authorize and provide funding for a Smart Community Prize Competition, similar to the Department of Transportation’s (DOT) 2015 Smart City Challenge.¹ Expand funding opportunities for research into smart-city technologies and for deployment of smart-city technologies into underserved communities.
• Mid-term: Develop new city services that enable more resilient and responsive local governments, while driving economic opportunities for U.S. communities of all sizes.
• Long-term: Ensure U.S. leadership in smart city technologies by funding expanded federal research and development (R&D) for transportation, energy, public safety, healthcare, and other areas.

Challenge and Opportunity

1.1 Potential of smart-city initiatives

Over the past five years, the Internet of Things (IoT)² has enabled communities to evolve into “smart cities”—cities that leverage sensors, networks, and data analysis to address challenges in healthcare, energy, the workforce, and other sectors. IoT networks include a range of technologies that connect everyday objects like cars, pacemakers, and thermostats to the internet to drive cost savings and improve safety. Examples of smart- city applications include:

• Transportation: Autonomous vehicles can use sensors and networks to safely navigate city streets for shuttle and delivery services. Internet-connected traffic signals can communicate with cars to reduce traffic congestion and accidents. Other sensors can help city planners prioritize streets and intersections for pedestrian-safety upgrades.
• Public safety: Internet-connected sensors help first responders determine where to prioritize efforts during emergencies.³ Sensors can also be used to monitor flooding or wildfires, helping make cities more resilient. Working with the City of Nashville, Vanderbilt University teams created a dashboard tool that allows first responders to analyze and manage crime and traffic accidents in real time. The tool predicts the likely impact of storms or flooding on accidents and crime, streamlining city decision making.⁴
• Communications: 5G wireless networks are the next generation of connectivity for mobile phones and other devices. These new networks offer the promise of high- capacity, low-latency connections to sensors for data and video.
• Energy: Smart grids and smart lighting can closely monitor power consumption, enabling municipalities to better match energy supply to energy demand. This in turn can save cities and/or utilities millions of dollars per year.

San Diego, California and Chattanooga, Tennessee provide examples of smart-city initiatives in action in the United States. San Diego spent more than $30 million to install 4,200 LED smart lights, traffic sensors, and pedestrian and public-safety monitors. Converting to LED lights saved the city approximately $3 million a year in power costs, which covered the additional cost of the smart sensors. The success of the upgrades motivated city leadership to recently add an additional 1,000 smart lights and sensors.⁵ Chattanooga was an early adopter of high-speed fiber-optic internet networks and smart-grid applications. One study found that from 2011 to 2016, Chattanooga’s investment in these and related technologies helped to create 3,950 jobs.⁶

Yet San Diego and Chattanooga are the exception rather than the rule. In general, the potential of smart-city technologies is going under-realized in the United States. We as a nation are failing to deploy, test, and scale what works. Successful technology development must be supported by experimentation, yet U.S. investment in testing the next generation of wireless networks, sensors, and data analytics has slipped behind the likes of China, East Asia, and Europe. This has left many American cities reliant on global industry partners to implement smart-city strategies.

1.2 Obstacles facing smart-city initiatives

Deploying and scaling smart-city initiatives has proven to be technically and financially prohibitive, especially for small- to medium-sized rural and urban communities. San Diego, Chattanooga, and other larger U.S. cities possess the right mix of investment, political will, and cross-sector collaboration to realize the full benefits of smart technologies. But smaller cities lack these vital capacities, making it difficult to invest in smart-city technologies and/or to move beyond the pilot stage of smart-city strategies. Specific obstacles include the following:

• Pilot smart-city efforts tend to be championed by an individual—a mayor or Chief Information Officer (CIO). These efforts often lose momentum to expand after an administration changes. Ensuring continuity when a change in administration occurs requires ensuring that city departments and external stakeholders see the value of smart-city technologies and are committed to furthering technology deployment.
• Most city CIOs (and the IT departments they oversee) lack discretionary funds sufficient to make upfront, multi-year investments in smart-city projects. As a result, smart-city pilot projects are often funded from whatever untapped pool of money happens to be available: typically around $50,000 to $250,000 per year. Funding at this level and in this way allows a community to trial multiple approaches to a particular problem and to demonstrate proof of concept. But without larger and/or more consistent investments, pilots are unable to grow.

• City leaders frequently struggle to coordinate with all relevant city departments on smart-city projects. Failing to include key departments in planning and pilot stages can create implementation challenges later on, especially when a particular department has the authority and budget needed to scale.
• Communities like Kansas City, MO have relied on donated equipment and services from industry partners in order to deploy smart-city pilot projects.⁷ As successful demonstrations of smart-city solutions have created markets for smart- city technologies in large cities, industry partners have become less likely to provide small- or mid-sized cities with smart-city technologies and services for free.
• American investment in R&D related to smart-city technologies is lagging. Other countries are leading the way on developing the next generation of 5G wireless networks, IoT sensors, connected and autonomous vehicles, and similar technologies. Investment is particularly lacking in the underserved areas that could most benefit from it.

The upshot is that the United States has much ground to make up when it comes to building the next generation of smart cities. Federal agencies can play an important role in laying the foundation for a new set of smart-city services and ensuring global competitiveness in urban and economic development. Federal agencies will also be key in ensuring that smart-city technologies benefit all Americans, not just those in high- income and urban settings.

Proposed Action

The federal government should launch a concerted national effort to expand the reach, readiness, and capacity of smart-city technologies, especially in smaller and underserved communities. This effort should be guided by the following fundamental principles:

• Every community is at a different stage in its smart-city development. Some are still working on their visions and strategies, others have completed small pilots, and still others have expanded their efforts citywide. The federal government must provide strong leadership when it comes to smart cities, while retaining flexibility to tailor specific projects and initiatives to individual communities. The federal government must offer communities (and their partners) a range of support options that vary by scope, technological maturity, and priority area. Small businesses, university researchers, and industry partners require R&D grants for a range of technology-readiness levels, including applied research, prototyping, demonstration projects, and real-world testing and evaluation.
• Intersectoral partnerships are essential to successful smart-city strategies. Federal support for smart-city initiatives should encourage collaborative partnerships among local governments, researchers, small businesses, and industry leaders.
• Smart-city investment should be targeted towards the places where it will do the most good. Today, larger cities and higher-income communities are reaping a disproportionate share of the benefits of smart-city technologies. The federal government should give priority to smaller, more rural, and underserved communities when it comes to allocating grants for smart-city planning, funding for smart-city pilot project, and support for scale-up efforts.

To begin, federal policymakers should convene representatives of cities, industries, universities, and federal agencies to identify obstacles to adopting smart-city technologies and to identify gaps where the federal government can provide additional support. This group should be tasked with developing a National Smart Community Strategy to be carried out through a coordinated interagency effort. An interagency working group should then be established to (1) oversee Strategy implementation, (2) identify additional options for expansion of federally funded smart-city R&D, and (3) identify barriers to use of federal community funds for smart-city initiatives. The Strategy should include a mix of short-, medium-, and long-term goals and actions. Short-term goals (i.e., over the next 2–3 years) should include creating new funding and support options for researchers and communities, especially in cities underserved by existing industry and federal investments. Medium-term goals should include developing a new set of expanded city services that enable more responsive governments and new economic opportunities for U.S. cities large and small. Long-term goals include making the United States a global leader in developing and deploying smart-city technology. Below, we propose specific policy actions designed to achieve these goals. These actions are intended to span a range of national priorities—including transportation, energy, and public safety—and to build on existing federal, state, and local smart-city programs.

2.1 Launch a smart city prize competition

The federal government has, to date, completed over 1,000 prize competitions across 100 agencies through its Challenge.gov platform. One of these, DOT’s Smart City Challenge⁸, specifically involved deployment of smart-city technologies to improve urban transportation. This approach could be easily extended to other smart-city domains, accelerating adoption of smart-city technologies nationwide and offering startups, students, researchers, application developers, and others a valuable opportunity to work with local communities on new solutions. We recommend that a national smart city prize competition (1) reward smart-city proposals that deliver clear benefits for underserved communities and (2) require communities to scale their smart city pilots to citywide services and secure industry and local matching funds. If federal agencies offered $250 million annually in total support across a range of sectors, competing communities could raise several times that from state, local, industry, and foundation partners. Support bundled together could easily top $1 billion in federal, local, and partner funding for smart cities.

2.2 Expand existing community development programs

The Department of Housing and Urban Development’s (HUD) ConnectHome pilot program⁹ allows HUD funding to be used to provide digital-literacy training for and distribute internet-connected devices to public-housing residents, and to install broadband networks in public housing units. Creating similar smart-city programs at HUD or other agencies would allow local public-housing authorities to leverage HUD funding for smart-city deployments and workforce training for residents. Since some HUD programs have a match requirement, these programs could also create even larger impacts by driving community reinvestment into smart-city efforts at the local level.

2.3 Award planning grants targeted at underserved communities

Before communities can take advantage of the opportunities afforded by smart-city technologies, they have to understand just what those opportunities are—and how their cities or regions could benefit. Small planning grants, such as those awarded by the Economic Development Administration’s (EDA) Economic Development Planning Assistance Program¹⁰, could support dozens of cities with $50,000 to $100,000 each to take this first step.

2.4 Expand support for regional innovation ecosystems

EDA provides communities with funding for smart-city startup accelerators, workforce training, IoT networks, and planning.¹¹ This funding could be increased to provide additional resources for smart-city startups or workforce training in underserved communities.

2.5 Expand R&D programs

Funding for R&D and pilot-project grants from agencies including DOT, the National Science Foundation (NSF), the Department of Energy (DOE), the Department of Homeland Security (DHS), and the Department of Defense (DOD) would accelerate domestic progress on technologies such as smart grids, autonomous vehicles, and remote healthcare. Funding should be used to enhance existing and effective programs (e.g., NSF’s Smart and Connected Communities Program, DOE’s Advanced Grid Research and Development Program¹²), as well as to expand funding for smart-city technologies to new agencies.

2.6 Use Presidential and Congressional authority

The next president should issue an Executive Order (EO) directing federal agencies to use existing programs to support smart-city R&D and to help expand access to smart- city technologies in underserved areas. In addition, if smart-city legislation (Section 4) does not pass in this Congressional session, the next president should support introduction of an updated and expanded smart-city bill in the next session. Such a bill should incorporate feedback from communities and other stakeholders as an important precursor to securing bipartisan support.

Historical Precedents

There are almost 50 existing federal programs related to smart cities and broadband infrastructure that could support the goals outlined in this paper.¹³ These programs support every stage of the smart-city pipeline, from support for R&D to community support for implementation. Some are narrowly focused on “smart cities” specifically, while others have a broader scope that includes funding for smart-city technologies as a component. Detail on several of these programs is provided below.

3.1 Smart City Challenge (Department of Transportation)

The Smart City Challenge asked “mid-sized cities across America to develop ideas for…[a] smart transportation system that would use data, applications, and technology to help people and goods move more quickly, cheaply, and efficiently.” DOT committed up to $40 million to help the winning city implement its vision. The challenge drew applications from 78 cities, and elicited proposals developed by city leaders, universities,

industry, and nonprofits working in collaboration. The challenge also led to over $90 million in matched funding from local industry partners in the winning city of Columbus, Ohio, as well as $10 million from Paul Allen’s Vulcan Inc.¹⁴ The Columbus proposal focused on providing better access to underserved neighborhoods and motivated establishment of an autonomous vehicle pilot with May Mobility in Columbus’s downtown.

Several cities, like Denver, that were selected as challenge finalists (but not winners) have followed through on ideas generated as part of the challenge process. Several of these cities have since received sizable grants from DOT (from $5 to more than $10 million) to implement projects and establish partnerships outlined in challenge proposals.

3.2 i6 Challenge (Economic Development Administration)

As part of the Department of Commerce, EDA is focused on job creation and economic development within low-income or high-unemployment areas across the country. The agency has traditionally provided communities with funding for projects ranging from training facilities to roads to networks of fiber-optic cables. The launch of EDA’s i6 Challenge in 2010 was novel for the agency in two ways: first, by being a prize competition, and second, by focusing on supporting startup accelerators. The challenge offered $12 million in funding for startup accelerators, with one prize for each of EDA’s 6 national regions (giving the program its i6 name). The i6 Challenge expanded quickly. A second round of awards was made to help communities launch new seed funds, and the program budget has been doubled to almost $24 million awarded to 44 organizations in 2019.¹⁵

3.3 Smart and Connected Communities Program (National Science Foundation)

Numerous federal programs support R&D projects narrowly targeted on one sector, such as healthcare, energy, or public safety. NSF’s Smart and Connected Communities (S&CC) program is one of the few programs that targets smart-city R&D across each of these technology areas. This annual grant opportunity offers universities and their community partners funding to develop the next generation of smart-city technologies. The S&CC program’s goal is to create “living labs” by supporting university research efforts within a partner community. Last year, NSF announced over $22 million in awards across 13 communities and 35 universities nationwide.¹⁶

3.4 ConnectHome (Department of Housing and Urban Development)

Launched in 2015, HUD’s ConnectHome pilot program allowed HUD funding to be used to provide free broadband services, digital training, and devices. The program targeted students (and their families) in public housing by leveraging newly adopted flexibility within existing HUD funding opportunities. ConnectHome started with 28 communities and quickly grew. The program reaches 56 communities and 52,000 students today, and has a goal of reaching more than 100 communities by 2021.¹⁷ While ConnectHome is not focused on smart-city technologies, this digital-inclusion initiative offers an approach for leveraging existing funding authorities and funding programs at HUD and other agencies to support smart-city technology deployment in underserved areas.

Stakeholder Support

There is bipartisan support for smart-city funding and programs at all levels of government. In Congress, the Smart City Caucus is co-chaired by Reps. Yvette Clarke (D-NY) and Susan Brooks (R-IN). A smart-city bill has been introduced in multiple Congressional sessions, although none has yet passed. On May 9, 2019, three members of the Smart Cities Caucus reintroduced their Smart Cities and Communities Act, which would provide $1.1 billion in agency funding over five years for smart-city initiatives.¹⁸

A large contingent of industry leaders and startups have entered the smart-city space to provide equipment, software, data analytics, and other smart-city services to cities. Stakeholders include large telecommunications providers, technology vendors, chip manufacturers, and cloud-service providers plus dozens of unique startups with their own market niche. No single company can supply a full range of smart-city services to a community, so many companies have begun forming partnerships to provide a “one- stop shop” for city leaders. These new partnerships can foster new applications of smart- city technologies and smart-city services.

Universities strongly support more R&D funding for foundational smart-city technologies, such as linking communications networks, IoT sensors, and data analytics. There is a particular need to fund real-world tests and evaluations of novel technologies emerging from university labs. Federal funding designated to support commercialization and deployment of new technologies would help researchers cross the “valley of death” that separates the lab from the marketplace.

Conclusion

Building resilient, equitable, and sustainable communities is difficult. Challenges in public safety, transportation, energy, healthcare, and other domains will only continue to grow in coming years. Smart-city technologies can help cities, small businesses, and local leaders address these challenges. The potential benefits are especially large for smaller, more rural, and lower-income communities. To help realize these benefits, the federal government should launch a national smart cities initiative with $1 billion in support from federal and external sources targeting underserved communities to catch up with leading U.S. cities, and the United States as a whole to catch up with the world.