Learn Russian: Инфраструктура в городе быстро улучшается. - The infrastructure in the city is quickly being improved.

Улучшается is an imperfective reflexive verb used to form the passive voice for an ongoing process. Short passive participles (like улучшена) are almost always formed from perfective verbs and describe a completed state ('has been improved'). The reflexive passive is the standard way to express an ongoing passive action in everyday and journalistic registers.

How would I add the agent, like 'by the government', to this passive sentence?

You can add the agent using the instrumental case: правительством. However, a B2 stylistic tip: reflexive passives can sound clunky when a specific human or organizational agent is attached. If you want to specify who is doing it, it is usually much more natural to switch to the active voice: Правительство быстро улучшает инфраструктуру.

Could I use the perfective reflexive улучшится if the action were happening in the future?

You could, but the meaning shifts slightly. Perfective reflexive verbs generally lose the true passive meaning ('will be improved by someone') and instead take on an intransitive or spontaneous meaning ('will get better' or 'will improve'). For a true future passive expressing an action done by an outside force, you would typically use the future tense of 'to be' with a short passive participle: будет улучшена.

Why does в городе come before the adverb and verb, rather than at the end of the sentence?