I don't know what's planned for settlement management, but I find its present state very shallow and uninteresting, so here's some quick suggestions that would work without having to completely replace the existing system.
- Add construction costs to each settlement improvement, and not just money - let training grounds require a small number of high-tier units in the garrison, let fairgrounds require an investment of alcohol, for example.
- Add financial upkeep costs to each improvement, increasing non-linearly with each level.
- Have improvements downgraded when a settlement is conquered, say a 50% per improvement to be downgraded when the settlement changes hands.
- Let improvements decay over time, say a 25% chance to downgrade by one level per ingame year per improvement.
- Most importantly, add additional tiers with greater costs and effects beyond the third tier, or greatly increase the effects of the second and third tiers.
- Make governors prioritize maintaining existing high-level improvements that the player manually built over building new ones.