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TRB P3 Resources

NCHRP Synthesis 391: Public Sector Decision Making for Public-Private Partnerships P3
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This synthesis examines the information available in the United States and internationally that is needed to properly evaluate the benefits and risks associated with allowing the private sector to have a greater role in the financing and development of highway infrastructure, and how that information can be used in the decision-making process. The synthesis also includes the results of two surveys. The first survey examined state DOTs, the District of Columbia, Puerto Rico, and 13 Canadian provinces. A second survey of interested parties was taken by 24 individuals who were identified by the authors and the topic panel, and had been publicized at the 2008 Annual Meeting of TRB.

The numerous topics of interest related to P3 decision-making were divided into three major categories: (1) project selection and delivery; (2) transparency; and (3) terms of P3 agreements.

Three major themes emerged from the research and surveys:

  1. How might governments decide whether or not to pursue a P3? Issues to consider include: the valuation of alternative approaches; appropriate risk transfer; transparency and public participation; and the unavoidable complexity of transactions.
  2. How might the public interest be protected? It is important to ensure that the private sector has the proper motivations to protect the public interest, while allowing investors to meet a return on the investment that is in line with the risk they take. Considerations include appropriate use of revenues, maintaining environmental standards, maintaining fair labor practices, and ensuring that the private sector meets safety, maintenance, and other standards specified by contract.
  3. Misperceptions about P3s can be a distraction from the real issues. Three identified misperceptions that require public education include: non-compete clauses are always part of P3s with a long-term lease component; a P3 is a synonym for tolls and with that toll increases are inevitable, resulting in windfall profits; and the public sector loses total control of the facility.