Matt Rosenberg (Article as published at Crosscut)

When California recently resolved its mammoth budget deficit, it presciently moved to ease restrictions on transportation public-private partnerships, which over the long run could help control costs to taxpayers of improving overloaded roads, rails and freight facilities. P3s, as the arrangements are called, draw from among construction, engineering, highway management firms - plus infrastructure investment groups often funded partly by public employee and building trades union pension funds - to form consortiums that get important transportation projects built more efficiently, and sooner versus later or never. A P3 consortium may provide consolidated services such as designing and building a toll bridge or highway section, and can also provide upfront capital if public funds are constricted, as is so often the case now.

The private consortiums may not only design, build, and help finance these variably-tolled facilities, they may operate and maintain them too, for several decades under a lease agreement with their public partner, such as a state department of transportation. (The latter can retain ownership, control toll rates and enforce contractual performance standards). Over the long haul, the private partners make back their investment and a profit, while the savings to taxpayers over a project's full life cycle accrue, versus going it solely on the public's dime, and solely under public-sector management. P3s can also target transit, and crucial port and rail infrastructure. (Various types of P3 are described here by the Canadian Council For Public-Private Partnerships.)

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Posted by boyang at March 31, 2009 5:41 AM