Portland has been doing such a thing for a few months now through an iPhone app appropriately named "City of Portland Citizen Reports". Allows users to upload photos with descriptions and tag them with GPS coordinates. The description pulled from the iTunes page:
Citizen Reports is a direct result of Mayor Adams and the City of Portland’s call for more open data and interactions with the citizens of Portland. Citizen Reports is used by citizens to report and request service calls to city assets and infrastructure, including issues with parks, pot holes, traffic lights, street lights, catch basins, and graffiti. Additional city assets and service request types will be added over time.
Using an iPhone, citizens can access this easy-to-use interface to the City of Portland’s issue reporting infrastructure. Citizens select the type of issue to report, take a photo (or upload an existing one), geo-locate the issue via GPS or interactive map, add comments, and send their report directly to the responsible bureau for resolution. Citizens can also view issues they have previously submitted and check the status or resolution of the issue.
Citizen Reports is a small but important step in allowing citizens to participate in expediting the City of Portland's awareness and resolution of various issues. Citizen Reports is available for free within the Apple App Store.