We’re in the “get creative” stage of smart city project financing. Given the variety of regulatory environments and resources available across the country, there simply isn’t a single, predominant funding strategy, and there won’t be for some time to come.

However, the lack of a single solution means that several different strategies are flourishing. At our recent US Ignite Forum workshop on smart city funding in Philadelphia, we heard from municipal leaders focused on grant awards, bond funding, public-private partnerships, advertising-driven initiatives, and joint public efforts spanning multiple local government and academic institutions. What we learned will end up in a new playbook later this year — one in a growing library of playbooks now housed on our site.

In the meantime, we thought it worth sharing just a few of the insights that emerged at the event from cities that have been successful with grant proposals, including proposals for federal and state grants, as well as non-profit foundation funding.

Grant Proposal Tactics

Tactic #1: One recommendation that Philadelphia Deputy Commissioner of Transportation Richard Montanez emphasizes in pursuing competitive grants is the idea that cities should make extensive use of data to support their funding requests. In Philly, the streets department collects information on bus travel times, bike share trips, pedestrian counts, vehicle counts, and vehicle speeds. What is all of that data good for? It helps support claims that money is needed to improve traffic congestion, public safety, or transit options in underserved neighborhoods.

For example, Philadelphia can point to slow traffic along a city block and use that as evidence of the need for priority signaling for public buses, which carry passengers more efficiently than individual cars.

Chart: Competitive grants awarded to the city of Philadelphia

Collecting and applying data isn’t the only way the streets department in Philly has improved its grant success rate in recent years, but it is a key factor. After hovering in the $5 million to $10 million range for grant awards between 2010 and 2013, the city substantially boosted its intake starting in 2014, and now brings in grant funds of roughly between $20 million and $35 million annually.

Tactic #2: It’s a truism of smart cities that it often takes money to make money, which is why matching funds are such an important part of the grant proposal process. That fact has been hammered home in several forums recently, including during a presentation by the city of Denver at our Big Data workshop last June. At the time, Denver Smart City Program Manager Emily Silverman explained how the city needed to raise internal funds of $500,000 to start the development of an Enterprise Data Management system before several millions of dollars in grant funding from the Department of Transportation kicked in.

At our Philadelphia event, Senior Marketing Manager for Smart Columbus Jennifer Fening highlighted the idea of matching funds as one of the main reasons her city secured $40 million dollars as the winner of the Department of Transportation’s Smart City Challenge in 2016. It wasn’t just the fact that Columbus committed $90 million in matching funds up front, according to Fening, but that those funds were raised from a large diversity of organizations.

“We had the most investors. We had the most diverse representation of people willing to come to the table, which stood out for us,” said Fening, suggesting that broad stakeholder support via matching funds was a critical component in winning the DOT’s challenge grant.

Tactic #3: One thing that can be easy to forget faced with the daunting task of a grant proposal is that there is help available. Specifically, the agencies putting grants up for bid are there to help applicants throughout the process.

Angela Dixon, Director of Planning at the Office of Transportation & Infrastructure Systems (oTIS) in Philadelphia, noted at our workshop event that agencies often host webinars following the announcement of a grant opportunity, and that proposers can learn a lot just by listening in. There’s always a contact person for grant operations as well, and often that support representative can not only answer questions, but also suggest ways to strengthen a proposal.

Dixon recounted a grant that her team submitted for in a second-round attempt after not winning in their first year. She said her team called up the reviewing agency after losing initially, and “they gave us some tips that said you need to reshape this, you need to do this better. Your narrative really wasn’t very clear. And we won it the next round.”

More insights to come in our Smart City Funding Strategies playbook later this year.