Public-private partnerships (PPPs) have been a popular way to finance development projects in Atlanta, Georgia for many years. These collaborations offer a variety of advantages, such as accelerating project completion, providing access to additional capital, allowing for a longer-term view of asset management, and reducing public costs. In 1999, the city of Atlanta created a PPP for its drinking water system. Unfortunately, the contract was terminated 16 years later due to dissatisfaction with the contract specifications.
Projects in which the private partner directly received toll revenues tended to use more private capital than those in which the partner received availability payments. The division of risk between private investors, state and local governments, and the federal government depends on whether the funding is reimbursed through tolls or availability payments. The legislation broadly defines the “qualified project” as any project that satisfies a purpose or public need. Once the project is finished, the public agency manages the operation and maintenance, although in some cases it hires a private company to carry out part of the work.
It is not yet known if the growing number of potential projects will result in significant increases in the number of future partnerships. Public-private partnerships for transportation and water services began in the 1990s. For example, California established such an association in the early 1990s to expand its State Route 91. This report evaluates whether public-private partnerships have allowed projects to be built more quickly or at a lower cost to taxpayers than other agreements. When bonds are backed by the government, bondholders generally do not demand higher interest rates because the risk of default is borne by taxpayers and not by the bondholder.
AECOM Consult, Inc (200) User Guide on Implementing Public-Private Partnerships for Transportation Infrastructure Projects in the United States.
