June 22, 2016

If done correctly and with the right project, public-private partnerships (P3s) can offer an alternative way to deliver large infrastructure projects faster, cheaper, and sometimes better overall. Yet P3s are much more complicated than the traditional way of building state and local roads and transit systems. They can be extremely difficult even before a project begins construction, posing legal and financial challenges in addition to extensive efforts to engage with the public. Implementing a successful P3 has been especially challenging for state and local governments who may not have enough experience to handle the process.

With this current P3 landscape in the United States – one that is largely focused on transportation – Eno and the Transportation Finance Working Group have been spending the past year carrying out our P3 Technical Assistance Awards, which concluded this past May. This effort stemmed from one of the local-level recommendations in our 2014 report Partnership Financing: develop P3 knowledge and capacity among the public sector executives and professional staff.

Through the P3 Technical Assistance Awards, which were funded in part by the Surdna Foundation, Eno engaged directly with local jurisdictions to help build a knowledge base within regional public agencies and foster a discussion focused on current P3 issues at the local level. Each award winner received a one-day course session about the P3 development process and a one-day P3 summit. The summit convened professional staff and executives from the public sector, as well as participating members of the Working Group.

Three winners were selected: Broward County government in Florida, the Office for P3s in the District of Columbia, and the Metropolitan Transportation Commission in the San Francisco Bay Area. (Summit proceedings are currently available on our P3 Resources Page) While each region had a different topic to discuss and lessons to draw on, all shared some overarching themes:

 Public sector staffing

This was an oft-discussed topic among all the summits. All reiterated the point that having the proper skills goes beyond simply hiring good consultants — it also means hiring in-house staff that is capable of navigating the financial and legal complexities of a P3 deal. Having skilled staff allows the public sector to know how to work with the private sector and to undertake a P3 project responsibly.

The public interest

Protection of the public interest in P3s was also discussed throughout the summits. For Broward County, the discussion included lessons for how to continuously engage with the public early and often, as public opposition can stop even the most robust P3 projects. For a new P3 office such as the one in DC, public engagement and developing performance metrics will be crucial towards building the public’s trust and success for future P3s. For an agency like MTC, participants discussed how to adequately evaluate proposals in a way that balances the public interest and the benefits of a potential P3 project.

Navigating the P3 process

Not every project is appropriate as a P3, so a large part of each summit focused on understanding the details of how a P3 project develops. For Broward County, the discussion focused on the need to standardize internal processes, such as evaluating solicited and unsolicited proposals, and managing the contractual process. Having standardized processes in place facilitates project implementation in the future. The importance of internal processes was also important for DC, which had launched their Office of Public-Private Partnerships shortly before their summit. For them, establishing these processes from the beginning will help them manage P3s as the project pipeline grows. In the Bay Area, much of the discussion looked at understanding what regional transportation authorities would need to accomplish with a P3, such as understanding project risks.

These discussions were focused on transportation P3s but they helped public sector attendees also grapple with important local issues, such as regional project priorities or interagency communications. While each of these summits took place in different areas of the country, they all demonstrated a need for continued thoughtful discussion focused around local P3s issues.

If you are interested in finding out more about past work by the Transportation Finance Working Group or would be interested in having a P3 summit in your local jurisdiction, reach out to Emily Han at ehan@enotrans.org.