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The Sharing Economy: Implementing Equipment-Sharing Systems

Government equipment sits idle as much as 70 percent of the time, so why not share with each other?

Editor's note: This is part two of a four-part series in which Government Technology looks at some ways that local governments are using the sharing economy right now, and what it will take for cities to benefit from the full value of sharing resources in the public sector.

Government has a lot of stuff. In state government, individual agencies often have stuff, such as utility or construction equipment that sits around unused in one part of the state while it’s badly needed in another. To solve this imbalance, departments in charge of equipment have resorted to using white boards to tally what’s available and then exchange emails and phone calls with other depots and departments to see who needs what and when.

Besides being cumbersome, it’s not very efficient, according to Alan Mond, the founder and CEO of MuniRent, an online goods sharing service. Government equipment sits idle as much as 70 percent of the time, according to Mond. Despite this problem, states and localities continue to buy and rent expensive equipment. His solution, similar to other goods-sharing services, is to provide a special online forum for large state agencies to share surplus goods and equipment, instead of renting or buying it from the private sector. “A sharing service like ours can reduce an agency’s equipment rental costs by 10 percent annually,” he said.

Government agencies pay MuniRent a monthly fee to list, reserve and loan their surplus equipment, which can be anything from dump trucks and excavators to front loaders and guardrail cleaners. One of the biggest users is Oregon’s Department of Transportation, which has been able to boost the use of some of its idle equipment by hundreds of hours since it started using MuniRent. Another 24 state agencies and local governments are subscribers or have plans to join the equipment-sharing service.

“There are a lot of agencies out there that realize they have a problem with surplus equipment,” said Mond. His service leverages the sharing-economy concept for a specific government need. “What we do is create a network so that one department within a state agency can borrow a piece of equipment from another department,” he said. “We can call it an internal sharing and scheduling platform.”

Besides large state agencies, the sharing platform is well suited for large cities, over 200,000 in population — any city that has multiple equipment yards, which makes it hard to keep track of trucks and machines.

According to Mond, fleet management systems, which can be found in just about any public works or transportation department, are good at keeping track of equipment maintenance and the number of parts required, “but they are not very good at scheduling who gets to use a piece of equipment and when.” Fleet management is designed for fleet managers, he added. “The MuniRent platform is designed for the crew and supervisors who are out in the field and who have to deal with equipment on a day-to-day basis,” Mond explained.

Identifying Government Sharing Opportunities

With the sharing economy expected to generate global revenues of $335 billion by 2025, the direct and indirect impact on government is expected to grow as well and has sparked questions around some key issues: What could governments be doing to help the sharing economy? How should governments address such issues as public safety and security?

The Ontario Chamber of Commerce and PricewaterhouseCoopers of Canada issued a report that identified a number of opportunities, including a handful that directly involve government:

  • Identifying government-focused sharing opportunities to create efficiencies, such as the use of extra public-sector building space or fleet cars, and their potential to decrease costs and increase revenues for the province.
  • Encouraging employees to use sharing platforms within and across public-sector organizations to create a better understanding of the impact, risks and potential of a sharing economy.
  • Working with economic development agencies, municipalities and different levels of government to coordinate an approach that fosters the sharing economy while minimizing the associated risks.
  • Helping encourage the creation of new insurance products (and/or) remove the regulatory impediments that might exist to ensure drivers and passengers, hosts and guests, and other types of providers and users understand how they are covered in the case of accidents or other issues.
  • Examining mechanisms to ensure sharing economy participants understand their tax obligations and are compliant.