july2017

100 101 PUBLIC-PRIVATE PARTNERSHIPS: GOOD POLICY THAT’S GOOD FOR TAXPAYERS THE ASSOCIATION FOR IMPROVEMENT OF AMERICAN INFRASTRUCTURE By John Parkinson T he Trump Administration touts plans for a $1 trillion investment program over the next 10 years to modernize U.S. infrastructure. It is an ambitious and much-needed proposal considering the current state of our roads, bridges, pipelines and municipal facilities. The American Society of Civil Engineers’ latest 2017 Infrastructure Report Card again gives the state of the nation’s infrastructure a D, showing little improvement from the last report four years ago. Despite some invest- ments in recent years, the organization specifi- cally spotlights the nation’s failure to close the investment gap with needed maintenance and improvements, which will most certainly affect our nation’s ability to compete in the global economic marketplace. To modernize our infrastructure, we’re going to need to tap into every possible resource in the public and private sectors and assess, eval- uate and implement innovative ideas to deliver, maintain and operate sustainable infrastruc- ture assets. Simply stated, we need to make better use of public-private partnerships (P3s). THE EVOLUTION OF P3 The P3 project delivery method is a power- ful vehicle to help reverse the deterioration of our nation’s assets across a broad range of public sectors. Some people associate P3s only with toll roads. But in truth the vehicle is used for almost any infrastructure sector, including projects to build or upgrade roads, bridges, hospitals, water/wastewater systems, university campuses, convention centers, courthouses, and even streetlight networks. The P3 model creates opportunity for both the public and private sec- tors, while maintaining public ownership across an asset’s lifecycle. Public ownership is the key difference between a P3 and infrastructure that is fully privatized. Beyond getting public projects off the ground and completed on time and on budget, P3s also account for the full cost of operating and main- taining the project over many decades—not just the initial design and construction. Common public construction contracts typ- ically focus on the initial construction of an