Emerging Technology
Article | July 13, 2022
The pandemic has blown up entrepreneurs and start-up ecosystems, so government support for start-ups has become critical.
The majority of them faced cash shortages and a lack of venture capital. For start-ups, cash is the most pressing issue. Furthermore, start-ups experienced a slow fundraising process accompanied by investor indifference.
Furthermore, the global workforce was not left untouched by the spillover. Start-ups began to lay off employees and reduce pay. According to StartupGenome research, three out of every four employees were letting their employer down.
While 39% of them laid off 20% or more of their workforce, two-thirds admitted to laying off 60% or more of their full-time employees. In the United States, the economy experienced the sharpest decline in employment, with 20.5 million people losing their jobs.
Following that, in order to address this and reduce the pandemic's impact on start-ups, the governments of many countries have stepped in to save their country's start-up ecosystem.
We've listed a few of the government's initiatives to help start-ups during the current cash crunch.
Direct grants and zero-interest loans:
Right now, cash is the most important concern for new businesses. Grants are regarded as the most beneficial policy instrument (29%), followed by loans (12%).
Access to venture capital investment:
If history is any guide, venture capital activity will likely decline in 2020 as well. This creates a quandary for the 18% of start-ups that require access to financing tools to increase investment.
Employment support schemes:
COVID-19 has had an impact on workforces all over the world. The US lost a record 20.5 million jobs in April, the fastest and sharpest drop since the government began tracking the data. Given these circumstances, it's no surprise that 17 percent of start-ups rank immediate employee protection as one of their top priorities.
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Emerging Technology, Government Business
Article | October 7, 2022
The COVID-19 virus (C19) pandemic is turning out to be the event of the century. Even World War seems timid in comparison. We are in the 4th month of the virus (in non-China countries) and have gone past the lockdown in many places. Isn’t it time we re-think the approach? What if there is another wave of C19 coming soon? What if C19 is the first of many such events in the future?
Before we get into analysis and solution design, summarizing the C19 quirks:
While a large section of the affected population is asymptomatic, for some it can be lethal
There isn’t clarity on all the ways C19 spreads
It’s known to affect the lungs, heart, and kidneys in patients with weak immunity
It has been hard to identify a definitive pattern of the virus. Some observations in managing the C19 situation are:
With no vaccine in sight, the end of this epidemic looks months or years away
Health care personnel in hospitals need additional protection to treat patients
Lockdowns lead to severe economic hardship and its repeated application can be damaging
Quarantining people has an economic cost, especially in the weaker sections of society
If one takes a step back to re-think about this, we are primarily solving 2 problems:
Minimise deaths: Minimise the death of C19 and non-C19 patients in this period
Maximise economic growth: The GDP output/growth should equal or higher than pre-C19 levels
One needs to achieve the 2 goals in an environment of rising number of C19 cases.
Minimise deaths
An approach that can be applied to achieve this is:
Data driven health care capacity planning
Build a health repository of all the citizens with details like pre-existing diseases, comorbidity, health status, etc. The repository needs to be updated quarterly to account for patient data changes
This health repository data is combined with the C19 profile (disease susceptibility) and/or other seasonal diseases to determine the healthcare capacity (medicines, doctors, etc.) needed
The healthcare capacity deficit/excess needs to be analysed in categories (beds, equipment, medicine, personnel, etc.) and regions (city, state, etc.) and actions taken accordingly
Regular capacity management will ensure patients aren’t deprived of timely treatment. In addition, such planning helps in the equitable distribution of healthcare across regions and optimising health care costs. Healthcare sector is better prepared to scale-up/down their operations
Based on the analysis citizens can be informed about their probability of needing hospitalisation on contracting C19. Citizens with a higher health risk on C19 infection should be personally trained on prevention and tips to manage the disease on occurrence
The diagram below explains the process
Mechanism to increase hospital capacity without cost escalation
Due to the nature of C19, health personnel are prone to infection and their safety is a big issue. There is also a shortage of hospitable beds available. Even non-C19 patients aren’t getting the required treatment because health personnel seek it as a risk. This resulted in, healthcare costs going up and availability reducing.
To mitigate such issues, hospital layouts may need to be altered (as shown in the diagram below). The altered layout improves hospital capacity and availability of health care personnel. It also reduces the need for the arduous C19 protection procedures. Such procedures reduce the patient treatment capacity and puts a toll on hospital management.
Over a period, the number of recovered C19 persons are going to increase significantly. We need to start tapping into their services to reduce the burden on the system. The hospitals need to be divided into 3 zones. The hospital zoning illustration shown below explains how this could be done. In the diagram, patients are shown in green and health care personnel are in light red.
**Assumption: Infected and recovered C19 patients are immune to the disease. This is not clearly established
Better enforcement of social factors
The other reason for high number of infections in countries like India is a glaring disregard in following C19 rules in public places and the laxity in enforcement. Enforcement covers 2 parts, tracking incidents of violation and penalising the behaviour. Government should use modern mechanisms like crowd sourcing to track incidents and ride on the growing public fear to ensure penalty enforcement succeeds. The C19 pandemic has exposed governance limitations in not just following C19 rules, but also in other areas of public safety like road travel, sanitation, dietary habits, etc.
Maximise economic growth
The earlier lockdown has strained the economy. Adequate measures need to be taken to get the economy back on track. Some of the areas that need to be addressed are:
One needs to evaluate the development needs of the country in different categories like growth impetus factors (e.g. building roads, electricity capacity increase), social factors (e.g. waste water treatment plants, health care capacity), and environmental factors (e.g. solar energy generation, EV charging stations). Governments need to accelerate funding in such projects so that that large numbers of unemployed people are hired and trained. Besides giving an immediate boost to the ailing economy such projects have a future payback. The governments should not get bogged down by the huge fiscal deficit such measures can create. Such a mechanism to get money out in the economy is far than better measures like QE (Quantitative Easing) or free money transfer into people’s bank accounts
Certain items like smartphone, internet, masks, etc. have become critical (for work, education, critical government announcements). It’s essential to subsidise or reduce taxes so that these items are affordable and accessible to everyone without a financial impact
The government shouldn’t put too many C19 related controls on service offerings (e.g. shops, schools, restaurants, cabs). Putting many controls increases the cost of the service which neither the seller not buyer is willing or able to pay. Where controls are put, the Govt should bear the costs or reduce taxes or figure out a mechanism so that the cost can be absorbed.
An event like the C19 pandemic is a great opportunity to rationalise development imbalances in the country. Government funding should be channelized more to under-developed regions. This drives growth in regions that need it most. It also prevents excess migration that has resulted in uncontrolled and bad urbanisation that has made C19 management hard (guidelines like social distance are impossible to follow)
Post-C19 lockdown, the business environment (need for sanitizers, masks, home furniture) has changed. To make people employable in new flourishing businesses there could be a need to re-skill people. Such an initiative can be taken up by the public/private sector
The number of C19 infected asymptomatic patients is going to keep increasing. Building an economy around them (existing, recovered C19 patients) may not be a far-fetched idea. E.g. jobs for C19 infected daily wage earners, C19 infected taxi drivers to transport C19 patients, etc.
In the last 100 years, mankind has conquered the destructive aspects of many a disease and natural mishap (hurricanes, floods, etc.). Human lives lost in such events has dramatically dropped over the years and our preparedness has never been this good. Nature seems to have caught up with mankind’s big strides in science and technology. C19 has been hard to reign in with no breakthrough yet. The C19 pandemic is here to stay for the near future. The more we accept this reality and change ourselves to live with it amidst us, the faster we can return to a new normal. A quote from Edward Jenner (inventor of Small Pox) seems apt in the situation – “The deviation of man from the state in which he was originally placed by nature seems to have proved to him a prolific source of diseases”.
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Government Business
Article | March 11, 2022
Another round of funding from by the Federal Aviation Administration (FAA) will guarantee the launch of numerous projects at airports throughout the U.S. This particular grant program provides smaller funding amounts, but the funding can augment projects that are part of larger initiatives.
U.S. Secretary of Transportation Elaine Chao announced in July that more than $273 million in airport safety and infrastructure funding has been approved for 184 airports in 41 states and six territories. Program details can be found here for airport safety and infrastructure grants. The bulk of the funding, just over $242 million, is provided through the FAA’s Airport Improvement Program, while $31 million is a result of the recent Coronavirus Aid, Relief, and Economic Security (CARES) Act.
This funding provides a 100 percent federal cost share for airport projects that fall into the category of infrastructure and/or safety. Projects of numerous types are eligible, but recently approved ones range from runway and taxiway construction to lighting improvements and master plan studies. And, most of the projects are slated to launch within the next year.
Projections for increased airline travel in 2021 are strong, and pent-up demand will result in even more upcoming airport projects of all types.
Florida
Plans for a major renovation at Punta Gorda Airport are underway and will be enhanced by a grant allocation of $471,305. The FAA funding will cover the design phase for renovating the airport’s 7,193-foot-long runway. Construction is slated to begin in 2021. Punta Gorda Airport is off the Gulf Coast north of Fort Myers.
Boca Raton Airport received a $694,444 federal grant to update its master plan. This upfront work will outline and prioritize airport improvement projects and expansion plans for the next two decades. Recent conversations have focused on new additions related to lighting, signage, taxiway and runway drainage, and other improvements. The 243-acre airport is in southern Palm Beach County.
While Tampa International Airport didn’t receive funding in the most recent round of FAA grants, numerous upcoming projects have been announced. The projects are listed in the airport’s 2021 Proposed Budget. Among those is an elevator modernization project projected to cost approximately $7.4 million. It is slated for the airport’s main terminal. Another technology project covered by a fiscal year 2021 capital commodity plan has a cost allocation of $1.5 million, and an airside A&C shuttle car and control system replacement project totaling $13.2 million is anticipated in the near future.
Miami International Airport is working on the solicitation for a new hotel with a 30- to 50-year lease agreement. As the nation’s second-busiest airport, officials hope to partner with a group to construct a “world-class” 350-room hotel. The plans call for the new hotel to be connected by a pedestrian bridge to Concourse D. Amenities will include a restaurant, business center, 20,000-square-foot meeting space for events, and a fitness center.
California
A small airport off Interstate 5 in northern California has been notified that it will receive funding for renovations. The Dunsmuir Municipal-Mott Airport was awarded $3.2 million to perform critical renovations to the runway and reconstructing the taxiway. City officials were pleased to announce that the airport runway, which has been in disrepair for some time, will now be completely refurbished and made safer.
Arkansas
Engineering and design work is nearing completion for a new $13 million terminal for Texarkana Regional Airport. The facility, which is located along U.S. 67 east of downtown Texarkana, received $3.6 million in FAA grant funding. Construction of the new terminal is just one part of a larger $34 million project for the airport.
Missouri
Columbia Regional Airport will extend one of its runways with the help of a $9.9 million federal grant. The Columbia City Council in March approved extending Runway 2-20 from 6,500 feet to 7,400 feet in order to be able to accept larger aircraft and also increase takeoff and stopping distances. City officials estimated the total cost of construction at $11 million, and the city has budgeted an additional $1.1 million for the runway extension project. This project will be launched in 2021.
Louisiana
Although airports in the state of Louisiana did not receive grant funding from the FAA, the Louis Armstrong New Orleans International Airport is working to finalize its master plan and has numerous projects already slated for the near future. Once the plan is completed, interested contractors will be able to find numerous and diverse improvement and expansion projects outlined. The airport is just south of Interstate 10 and Lake Pontchartrain.
Oregon
Hillsboro Airport has a $2.8 million construction project planned for early 2021. Officials have announced that a contractor will be selected to reconstruct almost the full length of Taxiway A and connect it to several other taxiways. The work will be performed in conjunction with the FAA and Port of Portland Operations.
Georgia
The city of Atlanta is scheduled to release a request for proposals (RFP) for on-call engineering services at Hartsfield-Jackson International Airport. An engineering firm will be selected to provide ground surveys in support of upcoming work that will be handled by the city aviation planning and development department. Atlanta’s airport held the distinction of being busier than any other airport in the U.S. in 2019. More than 110 million passengers passed through the airport either departing on or arriving back from airline flights.
Although these most recent grant awards will not fund huge airport projects, the funding will enable the launch of thousands of smaller contracting opportunities.
Mary Scott Nabers is president and CEO of Strategic Partnerships Inc., a business development company specializing in government contracting and procurement consulting throughout the U.S. Her recently released book, Inside the Infrastructure Revolution: A Roadmap for Building America, is a handbook for contractors, investors and the public at large seeking to explore how public-private partnerships or joint ventures can help finance their infrastructure projects.
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Article | June 10, 2020
While Americans wait to see if Congress will pass an infrastructure bill, alternative funding and collaborative initiatives are becoming the norm. Even the recent announcement that the U.S. is now in a designated recession has not caused Congress to focus specifically on economic recovery. Economists, financial experts, industry leaders, and elected officials all know that funding large public projects stimulates the economy and creates jobs. They also know that throughout history, infrastructure reform has been a proven path to economic recovery.
Currently, private sector investors stand ready to fund infrastructure projects in America and local government leaders are moving forward to launch projects of all types. Soon, there may be little need for Congress to do anything. The opportunity to lead in this area may soon be usurped by visionary regional leaders and private sector partners.
Destruction brought on by climate change, the devastation resulting from COVID-19, cyber threats on public networks, lack of adequate broadband, and a desperate need for new sources of revenue – these are the problems that have forced visionary leaders to take action and not wait for Congress. Now, change is coming on strong, and that’s a very good thing!
Airports are not waiting to launch critical and long-overdue expansions. State leaders already are combating rising seas and finding ways to install broadband. Wastewater plants are being constructed or upgraded, and various transportation projects are being launched. Because local leaders lacked the luxury of waiting to see if Congress would endorse or partly fund infrastructure projects, they found alternative funding sources.
Congress could have, and should have, already passed an infrastructure bill, even if it only established guidelines or outlined best practices. The Canadian Council for Public Private Partnerships would have been a good model to follow. An endorsement or a statement of support from Congress related to public-private partnerships (P3s) would still be encouraging.
But, with or without encouragement, regional leaders throughout the country are working with industry, nonprofit organizations, academia, and investors to launch large infrastructure projects. And, as that happens, local economies benefit and jobs are created. Entire communities and numbers of citizens benefit from the good that emanates from public safety, quality of life, asset preservation, sustainability, and taxpayer relief.
But, to the surprise of no one, infrastructure projects are costly and many of them require a number of consolidated funding sources. Infrastructure projects also may be funded through a revenue repayment model that compensates private sector investors over a decade or two. Other projects are funded by bonds, grants, and federal programs such as the Tax Cuts and Jobs Act which incentivizes investment into designated Opportunity Zone regions of the country.
Additionally, funding is still available from federal programs that have been in existence for decades. The Federal Emergency Management Agency (FEMA), Army Corps of Engineers, Department of Housing and Urban Development (HUD), and Community Development Block Grant programs all have funding that may be merged with other alternative funding sources.
Many state legislatures have allocated funding for ‘rainy days’, emergencies and/or ‘resiliency’ efforts. Special Districts also may be created by cities, a process that authorizes citizens to tax themselves for critical infrastructure projects. Finding numerous funding sources is not difficult and not a hurdle that stops infrastructure reform.
Two rather important issues, however, have slowed public acceptance of alternative funding and public-private partnerships – a lack of understanding by citizens about the cost and danger of not doing anything and the fact that the public at large does not completely understand the history or the success of P3s. Too many citizens view private sector investment into public projects as a new or risky concept, which is not the case. Collaborative initiatives have been responsible for the building of America’s infrastructure for more than 100 years. And, the public-private partnership model is common throughout the world and has been tested over many decades.
Here are but a few examples of visionary infrastructure initiatives happening now in America.
In Virginia, the Greene County Board of Supervisors has approved guidelines for establishing strategic public-private partnerships to develop numerous types of P3 projects in the county. This action will enable the Greene County School Board to enter P3s for the purpose of building educational facilities. Other possible projects likely will include landfills, drinking water production, and distribution systems. Projects also may include fire department facilities, education construction including stadiums, public safety buildings, utility and telecommunications initiatives, and broadband infrastructure.
The University of California (UC) has provided a 2019-2025 Capital Finance Plan (CFP) that represents $52 billion of capital that will be required by the campuses and its medical centers. The CFP outlines plans for proposed capital projects, P3s and the acquisition of real property. UC has found the P3 model to be efficient, especially for campus housing. The Irvine campus has a long history of partnering with third-party entities to advance its strategic goals.
The Yuma, Arizona City Council has approved a $51.4 million increase from last year for a Capital Improvement Program (CIP) budget. The city expects 45 percent of the costs to be obtained through grants, reimbursements, and P3s. The plan outlines 54 projects and funding plans of $20.3 million for projects in the Yuma Crossing National Heritage Area. The city also plans to augment funding with a federal grant and possibly private sector investment. It has scheduled a regional fiber optic infrastructure project for 2021 and has announced interest in a P3 engagement as the delivery model.
Florida’s Palm Beach Town Council recently approved $316,380 for a water supply feasibility study. An engineering firm will address the town’s need to explore different ways to provide residents potable water. A plan to determine how to meet future water demand is the objective. One option under consideration is to enter into a public-private-partnership to accomplish this objective.
Iowa State University is taking steps to become coal-free and reduce greenhouse gas emissions by 35 percent over the next three years. A P3 is being considered for the operation of its utility system. The university’s Board of Regents this month gave approval for a planning process to begin.
The state of Nebraska is considering a public-private partnership to build a new 1,600-bed prison to deal with overcrowding and staffing issues. Cost of the new prison has been projected to be in the $200 million range or higher, and the state anticipates that a P3 will be the delivery method. The department announced that the project would potentially meet space needs for the next 100 years.
These projects offer just a sampling of what is happening throughout America. State and local leaders are moving forward and not waiting for guidance or encouragement. Instead, most have grabbed the reins of America’s race to the future, and started to address the country’s infrastructure needs. That’s comforting, because there is much to be done.
America’s global competitiveness truly hangs in the balance along with the well-being of millions of families impacted by unemployment. A recession is never good, but this one could be short. Here’s hoping the media, citizens at large, and others who understand the country’s critical infrastructure problems will find ways locally to step up and encourage other elected leaders to support this clear path out of the current recession.
Mary Scott Nabers is president and CEO of Strategic Partnerships Inc., a business development company specializing in government contracting and procurement consulting throughout the U.S. Her recently released book, Inside the Infrastructure Revolution: A Roadmap for Building America, is a handbook for contractors, investors and the public at large seeking to explore how public-private partnerships or joint ventures can help finance their infrastructure projects.
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