POWER POINT

PRESENTATION ON
HIGHWAY

Public Private
Partnerships

NITTTR

Public Private Partnership

FHWA Definition
A public-private partnership is a
contractual agreement formed
between public and private sector
partners, which allows more private
sector participation than is traditional.

Typical Uses
Contracting with a private company to:
Renovate
Construct
Operate
Maintain
And/or Manage
A facility or system

History
Goes back to the earliest
construction in the United States
Used extensively in Europe and other
countries
Significant renewed interest in the
1980s
FHWA Legislation, ISTEA (1991),
SAFETEA-LU (2005)SEP 15

Why
Traditional funding sources are not
keeping pace with infrastructure
investment needs and the growing
public demand for services.

Benefits
Expedited project completion
Project cost savings
Improved quality
Use of private resources
Access to new sources of private
capital

Four Basic Dimensions of P3

Although each is unique, all P3s
include four basic characteristics:
Shared goals
Shared resources (time, money,
expertise, people)
Shared risks
Shared benefits

Typical Funding Sources

Tolls
Tax Increment Finance
Fees
Grants
Loans
Bonds
Other Revenue Streams

Two Major Steps

Crafting the Partnership
Implementing the Partnership
CRAFT

IMPLEMENTATION

Genesis
Whats the need
Whats driving the need, rationale
Facility non-compliance, natural
disaster, budget deficit
Is there a need for a Public/Private
Partnership?
Preliminary Project Definition

Feasibility
Is a Public/Private Partnership
feasible, not only financially, but
practically? Can it be done?
Market Research
Economic/Financial Analysis
Program, Budget and Schedule
Risk Analysis

Plan and Test

Final project definition
What is the best way to complete the project?
Has the plan been thoroughly tested to assess market
demand, public and stakeholder feedback and
economics?
Master schedule / budget .
political climate fatal flaws that could details the
project.

Procurement and Contracting

How do you choose and contract with
the best-value private partner?
Whats the best delivery method?
Design-Bid-Build
Design-Build
Finance-Design-Build

What do current statutes allow?

Procurement and Contracting

Procurement Approach
Sole Source, RFP, Low Bid

Risk Allocation between Public and

private Partners
Structuring of Contract/Risks and
Rewards

Implement
Environmental
Design
Permitting
Construction
Commissioning and Administration

Operate
Startup
Monitoring
Assessment
Enhancement
Contract Modifications
Contract Renegotiations

Conclusion

Questions
and
Discussion