Governing urban AI responsibly: Public perceptions of ethical and practical challenges in local government

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As AI becomes increasingly embedded in local government operations, public perceptions are a critical lens for evaluating responsible AI deployment. This study investigates how individuals' encounters with AI in local government settings relate to perceived benefits, risks, and understanding of AI, and how these perceptions are linked to the importance assigned to responsible AI characteristics. The study uses structural equation modelling to analyse survey data from 1220 respondents across Australia, Spain, and the US. The findings show that experience with local government AI is positively associated with perceived benefits and perceived understanding and negatively associated with perceived risks. Perceived risk is the strongest predictor of the perceived importance of responsible AI, while perceived benefits and understanding play supporting roles. This indicates that public prioritisation of responsible AI is linked less to optimism about AI's benefits and more to concern for safeguards and ethical governance. Country-specific models also showed variation in the relative strength and significance of these relationships across national contexts. These findings contribute to responsible AI scholarship by showing that public expectations for local government AI are shaped by both practical experience and governance concerns. The study highlights the need for context-sensitive AI governance strategies that build public trust, address perceived risks, and align AI deployment with public values.