![\"Sophia](\"https:\/\/www.europesays.com\/ai\/wp-content\/uploads\/2026\/07\/1783688168_684_sophiafox.jpg\")
<\/p>\nAs federal pandemic relief and infrastructure funding winds down, cities across the U.S. are increasingly looking to new technologies, like artificial intelligence, to help stretch limited budgets and support economic development, according to a report published Friday.<\/p>\n
The National League of Cities, an advocacy group, identifies in its annual State of the Cities report that economic development is top priority for mayors in 2026, followed by infrastructure, public health and safety, housing and budget management. But unlike in previous years, technology is less a standalone priority than an enabler across nearly every policy area, the report\u2019s authors found, from workforce development and AI adoption to cybersecurity and resilient infrastructure.<\/p>\n
Christine Baker-Smith, the league\u2019s research director, said cities are approaching technology with a broader perspective than one that simply adopts new tools.<\/p>\n
\u201cI think what\u2019s different about it this year is the way that it\u2019s woven throughout the other components of priorities,\u201d Baker-Smith said in an interview. \u201cIt\u2019s a lot more nuanced this year, and I think that\u2019s really exciting.\u201d<\/p>\n
Baker-Smith said AI and AI data centers are emerging as both an economic development strategy and a workforce issue, with cities looking beyond software to the physical infrastructure supporting the technology economy. Those investments could include workforce training, public transit, child care, electric grid improvements and water infrastructure that benefit both residents and technology companies, she said.<\/p>\n
\u201cHow do you use the companies coming in with a data center and their resources to invest in your city?\u201d she said. \u201cNot just thinking about it as what does it cost the city, but how can it support the city?\u201d<\/p>\n
The league\u2019s report also highlights mounting fiscal pressure facing municipalities as American Rescue Plan Act funds, known as the State and Local Fiscal Recovery, expire and Infrastructure Investment and Jobs Act funding begins to taper off. Nearly 70% of mayors surveyed in the report said federal funding has decreased or remained flat this year, while 81% expect the loss of federal infrastructure funding to negatively affect government projects.<\/p>\n
And as budgets tighten, Baker-Smith said, cities are becoming increasingly creative in pursuing partnerships with private industry to stretch their budgets: \u201cFrom nonprofits who are supporting childcare options to a corporation that\u2019s coming in that can be supportive of expanding the electric grid, there are mutually beneficial goals there \u2014 and cities are beginning to get very creative.\u201d<\/p>\n
The report points to cybersecurity as an increasingly important part of building resilient communities. Baker-Smith said protecting connected infrastructure has become a top concern for local leaders, in addition to preparing for climate-related disasters, but limited resources could be an obstacle for cities looking to pursue new environmental initiatives. \u201cOne of the other pieces of climate resilience that\u2019s important to capture is cyber resilience,\u201d she said. \u201cWater systems run on a network [and] are vulnerable to cyberattacks. How do you protect a city from that without lump sums of money?\u201d<\/p>\n
Technology is reshaping cities\u2019 public safety operations. The report notes a growing interest in drones \u201cas first responders,\u201d allowing emergency dispatchers to better determine whether incidents require law enforcement or medical personnel. \u201cTwo-thirds of the calls are public health calls, not public safety issues. And so [cities] are able to more strategically deploy resources,\u201d Baker-Smith said of the increasing use of drones. \u201cThere are, of course, AI predictive modeling approaches as well, but the drone one is really intriguing.\u201d<\/p>\n
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\n\t\t\tWritten by Sophia Fox-Sowell
\n\t\t\tSophia Fox-Sowell reports on artificial intelligence, cybersecurity and government regulation for StateScoop. She was previously a multimedia producer for CNET, where her coverage focused on private sector innovation in food production, climate change and space through podcasts and video content. She earned her bachelor\u2019s in anthropology at Wagner College and master\u2019s in media innovation from Northeastern University.\t\t<\/p>\n","protected":false},"excerpt":{"rendered":"As federal pandemic relief and infrastructure funding winds down, cities across the U.S. are increasingly looking to new…\n","protected":false},"author":2,"featured_media":101623,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[52881,24,25,111,14809,52882,52883,185],"class_list":["post-101622","post","type-post","status-publish","format-standard","has-post-thumbnail","category-ai","tag-2026-report","tag-ai","tag-artificial-intelligence","tag-artificial-intelligence-ai","tag-budget","tag-cybersecuity","tag-national-league-of-cities","tag-state-local-news"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts\/101622","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/comments?post=101622"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts\/101622\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/media\/101623"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/media?parent=101622"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/categories?post=101622"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/tags?post=101622"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}