Public-Private Partnership Peer Exchange: San Francisco Bay Area, California
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This report summarizes the noteworthy practices discussed at the "Public-Private Partnership (P3) Peer Exchange" held on March 22, 2016 in Oakland, California. This event was sponsored by the Federal Highway Administration's (FHWA) Center for Innovative Finance Support (formerly Innovative Program Delivery) . The Metropolitan Transportation Commission - the metropolitan planning organization for the nine-county San Francisco Bay Area - is considering P3 delivery for some of the express lane projects. MTC was interested in exploring the advantages and challenges of using P3s to deliver a network of managed lanes. Also in attendance were officials from several county-level transportation authorities in the Bay Area considering P3 delivery for planned highway projects in their jurisdictions. The one-day peer exchange was held on March 22, 2016 in Oakland, California. Participants included the four peer presenters, MTC staff, representatives from several county transportation agencies, FHWA staff, and Volpe Center staff. The exchange included five sessions featured a brief overview by one peer followed by discussion with the host agency and other peers and participants. After a final question-and-answer session, the event concluded with an open discussion of key topics. The following topics were discussed at the peer exchange: P3 Planning and Financial Viability, Tolling and Revenue Risk, Institutional Knowledge and Procurement, and Introducing a Managed Lanes Program.
P3 Peer Exchange: Denver, Colorado (2014)
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This report highlights key recommendations and noteworthy practices identified at the peer exchange on public-private partnerships (P3s) held on November 5-6, 2014 in Denver, Colorado. This event was sponsored by the Federal Highway Administration's Center for Innovative Finance Support . The Colorado DOT (CDOT) Office of Major Project Development (OMPD) and the CDOT High Performance Transportation Enterprise (HPTE) asked FHWA to organize peer exchange to better understand common challenges in the P3 delivery process and to incorporate lessons learned from experienced P3 practitioners from public agencies and the private sector.
Successful Practices for P3s: A Review of What Works When Delivering Transportation Via Public-Private Partnerships
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This report identifies best practices in the use of public-private partnerships (P3) where private sector concession companies design build finance operate and maintain new highways and other transportation improvements. The report was prepared by the United States Department of Transportation (U.S. DOT) to describe how public agencies can best work with the private sector to implement new transportation improvements. The report also supports the mission of U.S. DOT's newly established National Surface Transportation and Innovative Finance Bureau (the Bureau), which is to promote best practices in innovative finance and the use of P3s to deliver transportation improvements. The report documents successful practices that have emerged in the U.S. P3 market since the early 1990s, together with the important issues they address. As these practices continue to evolve, the document captures the current state of knowledge.
The information in the report was developed from interviews and discussions with P3 practitioners from both the public and private sectors, complimented by publicly available reports and articles. The report is intended to be helpful to all transportation professionals involved in any way with P3 projects, as well as legislative advisors and public policy professionals. The document is organized around the following phases in implementing and operating P3 projects: legislation and policy, project development, procurement, and performance monitoring and oversight.
Availability Payment Concessions Public-Private Partnerships Model Contract Guide - Draft
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This guide presents key concepts for the structuring and development of legal contracts for Availability Payment-based highway public-private partnerships (P3s). It is part of a broader effort by the Federal Highway Administration (FHWA) to promote understanding of P3 transactions, which includes the Core Toll Concessions P3 Model Contract Guide, found at http://www.fhwa.dot.gov/ipd/p3/resources/p3_core_toll_concession_contract_guide.aspx. This guide is designed to provide industry-standard concepts, relevant common tools and mechanisms, and situational examples applicable to Availability Payment-based P3 transactions, and follows a structure similar to the previously published guide on toll concessions.
Public-Private Partnerships: Labor Best Practices - Draft
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This chapter on Labor Best Practices is recommended by the U.S. Department of Labor, and discusses labor provisions recommended by the U.S. Department of Labor for all P3 concession agreements, following a collaboration with USDOT, regardless of source of funding (i.e., Federal, State, or private) or form of compensation (i.e., user tolls or APs).
Model Public-Private Partnership Core Toll Concession Contract Guide - Final (Part 1)
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This Guide presents key concepts for the structuring and development of legal contracts for highway transportation Public-Private Partnerships (P3) in the United States. Required of the Federal Highway Administration (FHWA) by the Moving Ahead for Progress in the 21st Century Act (MAP-21), the Guide illustrates how P-3 contracts are developed and structured and explains the major provisions in typical P3 contracts. The Guide is part of a broader effort by FHWA to promote understanding of P3 transactions, which will include a parallel document on availability payment contracts used is some P3 transactions. This Guide is designed to provide industry-standard concepts, relevant common tools and mechanisms, and situational examples applicable to P3 transactions.
On February 6, 2014, FHWA published a draft of the Core Toll Concession Model Contract Guide (the Guide - Docket No. FHWA-2014-0006), requesting comments by March 10, 2014. FHWA received a total of 133 public comments on the review document from State Departments of Transportation, industry organizations, consulting firms, and private citizens. This final version of the Core Toll Concession Model Contract Guide published by FHWA on September 10, 2014 reflects responses to those comments, as well as further clarifications.
For further information please contact: Mark Sullivan, Center for Innovative Finance Support, 202-366-5785, mark.sullivan@dot.gov, Federal Highway Administration, 1200 New Jersey Avenue, SE., Washington D.C. 20590; Alla Shaw, Office of the Chief Counsel, 202-366-1042, alla.shaw@dot.gov, Federal Highway Administration, 1200 New Jersey Avenue, SE., Washington D.C. 20590; or Prabhat Diksit, 720-963-3202, prabhat.diksit@dot.gov, 12300 W. Dakota Avenue, Suite 370, Lakewood, CO 80228.
Response to Comments on the Draft Core Toll Concession Model Contract Guide
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This document provides a summary of FHWA's responses to the 133 comments it received on the draft of the Core Toll Concession Model Contract Guide it published on February 6, 2014, as well as further clarifications made to the final version of the Guide. The majority of the comments focused on the terms of the concession agreement presented in the Guide including terms relating to tolling regulation, benefit sharing, supervening events, changes in equity interest, changes in law, defaults, early termination, and handback. A minority of comments addressed the desirability of public-private partnerships (P3s) as a matter of public policy.
Model Public-Private Partnerships Toll Concessions Contract Guide - Draft Addendum (Part 2)
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On January 16, 2015, FHWA published the Model Public-Private Partnerships Toll Concession Contract Guide - Draft Addendum (Docket No. FHWA-2014-0006), requesting comments by February 6, 2015. It builds on "core" provisions presented in Part 1.
P3 Concessions in the U.S. - New Build Facilities Map
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This map identifies new-build U.S. highway P3 concessions that are in operation or under construction.
P3 Concessions in the U.S. - Existing Facilities Map
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This map identifies U.S. P3 concessions on existing toll facilities.
International Public-Private Partnership Synthesis Report
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This report synthesizes the findings of a series of reports
prepared for FHWA following an international public-private
partnership (P3) scan conducted in 2008. The scan, sponsored by
FHWA, the National Cooperative Highway Research Program, and the
American Association of State Highway and Transportation
Officials, led investigators to the United Kingdom, Australia,
Portugal, and Spain to study the P3 markets in those countries
and bring back transferable lessons for the evolving P3 market in
the U.S. The scan resulted in four targeted reports on P3 tools,
techniques and projects, as well as a summary report of the scan
experience. This synthesis report was created to present the
wealth of information from those reports in an accessible format.
The synthesis report contains three sections. The first section summarizes notable P3 practices used in the four scan countries and Canada (included in the analysis but not formally part of the scan trip), including subjects such P3 delivery options, value for money analysis, and risk allocation. The second section provides a brief overview of the development of the P3 market in each of the five countries, accompanied by 12 project profiles of notable P3 projects in each market. The last section is a summary of lessons learned from the scan reports that may be beneficial for actors in the U.S. The 12 project profiles included in the synthesis report share the formatting of profiles on the FHWA Center for Innovative Finance Support website for ease of reference.
Model P-3 Contracts Listening Session (January 16, 2013)
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MAP-21 requires the U.S. DOT/FHWA to develop standard model P3 contracts for the development, financing, construction, and operation of transportation facilities. On Wednesday, January 14, 2013, FHWA held a Listening Session for public project sponsors, consultants, private sector contractors, financing institutions, union representatives, concessionaires, and other organizations involved in project development; and members of the general public to provide input as it initiated development of these contracts. Topics discussed included: the design of the model contract template; the scope of the model contracts; and specific provisions included in the model contracts.
Establishing A Public-Private Partnership Program: A Primer
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Establishing a Public-Private Partnership (P3) program within a public agency involves issues from enabling legislation through identification, evaluation, negotiation and management of P3 projects. This primer explores key issues involved in establishing a P3 program at a public agency with a focus on P3s for new capacity for highway infrastructure.
This primer contains eight chapters. Following an introduction, Chapter 2 presents the key challenges to successful program development, highlighting organization/cultural changes, coordination, and conserving institutional. Chapter 3 describes the strategies for implementation, including roles, staff building/hiring/training and specialized P3 units. Chapter 4 discusses legal and statutory issues, while Chapter 5 presents methods for identifying, evaluating and structuring P3 projects. Chapter 6 presents information on conducting procurement and Chapter 7 has recommendations for oversight and monitoring. Finally, Chapter 8 includes concluding remarks on the responsibilities and considerations of policymakers as they assume the new role of a performance-based contract manager.
Financial Structuring and Assessment for Public-Private Partnerships: A Primer
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This primer addresses Financial Structuring and Assessment for public-private partnerships (P3) and has been prepared as a companion document to FHWA's recent primers on Value for Money Analysis, Establishing A Public-Private Partnership Program and Risk Assessment for P3s. Most P3 projects are financed by using a combination of private equity, debt, and (often) public subsidies. For financial assessment of P3s, it is important to understand these sources of capital, how they are combined (referred to as "financial structure"), and how funds invested in a project are repaid.
This primer contains ten chapters. Following an introduction, Chapter 2 presents the basic concepts of project finance for P3s. Chapter 3 describes the various types of revenue sources that are used with P3s together with their advantages and disadvantages with regard to P3s in Chapter 3. Chapter 4 discusses sources of public sector financing for P3s, while Chapter 5 discusses the various sources of private capital and their incentives and capabilities, including how debt repayments may be scheduled to match projected cash flows to help make the project financially viable. Chapter 6 discusses the role of financial models, focusing on what is analyzed and interpretation of results rather than the details of the modeling process. Chapters 7, 8 and 9 describe the metrics used for financial evaluation by public agencies, equity investors and lenders respectively. Finally, Chapter 10 concluding remarks on the different ways in which financial assessments are used by project sponsors and private developers as P3 projects advance through the procurement and implementation processes.
Risk Assessment for Public-Private Partnerships: A Primer
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This primer addresses Risk Assessment for public-private partnerships (P3) and has been prepared as a companion document to FHWA €™s recent primers on Value for Money Analysis, Establishing A Public-Private Partnership Program and Financial Structuring and Assessment for P3s. Project risk management is an iterative process that begins in the early phases of a project and is conducted throughout the project €™s life cycle. It involves systematically considering all possible outcomes before they happen and defining procedures to accept, avoid, or minimize the impact of risk on the project.
The primer contains seven chapters. Following an introduction, Chapter 2 discusses how the extent of risk transfer varies by type of project and type of P3 contract. Chapter 3 outlines the key types of risks faced in P3 projects. Chapter 4 presents analysis of project risks to assess their cost impacts. Chapter 5 explains how risks are optimally allocated between the public and private sectors to minimize total project life-cycle costs. Chapter 6 discusses how costs of risks under traditional and P3 procurements may be incorporated into Value for Money analyses often used to compare the two procurement options. Chapter 7 concludes with a summary.
Value for Money Assessment for Public-Private Partnerships: A Primer
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This primer addresses Value for Money Assessment (VfM) for public-private partnerships (P3) and has been prepared as a companion document to FHWA €™s recent primers on Risk Assessment, Establishing A Public-Private Partnership Program and Financial Structuring and Assessment for P3s. The VfM analysis process is used to compare the aggregate benefits and the aggregate costs of a P3 procurement against those of the traditional public alternative. VfM assessment is different from benefit-cost analysis, which determines whether investing in a public sector project is a good use of societal resources. They are also distinct from the process of establishing whether or not a project is actually affordable to the government.
The primer contains nine chapters. Following an introduction, Chapter 2 provides an overview of the VfM analysis process. Chapter 3 discusses discounting of future costs and revenues to facilitate comparison of the procurement alternatives in terms of present value. Two key components of the PSC are life-cycle costs and the costs or risks. They are discussed in Chapters 4 and 5 respectively. Toll revenue risk is discussed separately in Chapter 6. Chapter 7 discusses quantitative assessment of VfM and Chapter 8 discusses qualitative assessment. Finally, Chapter 9 presents a summary with cautionary notes based on experience to date.
Public-Private Partnership Concessions for Highway Projects: A Primer
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This primer provides a brief introduction to public-private partnership (P3) concessions for transportation project finance. Although many types of P3s exist, this primer focuses on P3s that involve assumption of financing risk by the private sector, as well as long-term (i.e., 10+ years) operations and maintenance. These types of long-term P3s are typically termed Design-Build-Finance-Operate (DBFO) concessions, because the private sector assumes the obligation to design, build, finance, operate, and maintain a facility for a specified term in exchange for the right to some form of compensation for a specified term.
The primer reviews the basic structure of P3 project finance concessions and introduces the key public and private project participants and their roles. It also describes the motivations of both public and private partners for entering into P3s, presents typical P3 concession characteristics, and clarifies common misconceptions of what P3s can and cannot accomplish. Finally, the primer outlines typical P3 implementation steps and provides recent examples of P3 concessions.
Challenges and Opportunities Series: Public Private Partnerships in Transportation Delivery Report (May 22, 2012)
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FHWA has developed a report highlighting the opportunities and challenges associated with public-private partnerships. FHWA would like to make this report as valuable as possible to policy makers and practitioners by drawing in the wide range of public and private sector experience in the US and around the world. We are especially interested in comments that:
P3 Program Road Map
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The FHWA P3 Roadmap identifies initiatives and actions to be implemented by FHWA from 2013 through 2017 to support the development and use of public-private partnerships (P3s) across the United States with a unified approach. The primary audience for these activities is FHWA and its partner agencies within the U.S. DOT as well as external public sector stakeholder organizations and interest groups.
FHWA P3 Program Plan
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The FHWA P3 Program Plan identifies initiatives and actions to be implemented by FHWA from 2013 through 2017 to support the development and use of public-private partnerships (P3s) across the United States with a unified approach. The primary audience for these activities is FHWA and its partner agencies within the U.S. DOT as well as external public sector stakeholder organizations and interest groups. P3 Program Plan seeks to achieve the following measurable outcomes:
Improving P3 capacities within State governments to support the consideration and identification of projects for P3 procurement during the planning process; conduct the P3 procurements; and manage P3 contract performance and evaluate post-implementation outcomes.
Value for Money State of the Practice (December 2011)
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The 2011 Value for Money State-of-the Practice document was created to assist state practitioners in their P3 program efforts. Value for Money is a uniform process utilized on a case-by-case basis to compare the aggregate benefits and the aggregate costs of a P3 project against those of the traditional public alternative. In addition to the introductory chapter (Chapter 1), the report includes two separate sections: International Methodology and Practice and Methodology and Practice in the United States. The report is a state-of-the practice document. FHWA does not recommend any single approach to analyzing procurement options. FHWA does highly encourage that state practitioners consider some type of analysis when considering P3 procurement options.
Introduction to Public-Private Partnerships (P3s)
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This presentation prepared by Center for Innovative Finance Support P3 specialists provides definitions of common P3 terminology, information of the benefits and challenges associated with P3 projects, examples of different types of P3 projects and a review of the financing tools that may be used with P3 project. The intent of the presentation is to:
Advanced Public-Private Partnerships (P3s) Training
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Q&A Information Website
The Center for Innovative Finance Support hosted an Advanced Public-Private Partnerships (201 level) webinar that focused on questions from the Colorado DOT with regards to specific issues related to public-private partnerships for High-Occupancy Toll (HOT) lanes. Experts from states that have successfully implemented public-private partnership agreements discussed their experiences and how they have addressed the issues. The webinar is intended for transportation professionals who already have a basic understanding of public-private partnerships.
Innovation Wave: An Update on the Burgeoning Private sector role in U.S. highway and Transit Infrastructure
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This 2008 report describes the use of PPPs by state and local transportation authorities over the recent past and provides an update of USDOT's 2004 Report to Congress on PPPs (the "2004 Report"). The primary purposes of the P3 Primer are: (i) to explore the growing use of PPPs by state and local transportation authorities, and (ii) to identify the advantages and disadvantages of PPPs as an alternative to traditional approaches to transportation funding and procurement. The substance of this report is set forth in Sections III through VI. Section III defines PPPs and describes their benefits. While the 2004 Report provided a broad definition of PPPs, this report refines and focuses that definition to reflect the increasing utilization in the United States of long-term, concession-based PPPs, a subset of PPPs which have become significantly more prevalent since the 2004 Report was delivered. This section of the report then briefly describes the benefits of PPPs that have been used in the United States and abroad, which were described in greater detail in the 2004 Report. Section IV explores the use of long-term, concession-based PPPs in the United States while Section V describes the advantages of PPPs as an alternative to the failings of traditional approaches to project funding and delivery. Section VI identifies certain risks commonly attributed to PPPs and how they can be managed and evaluated.
Public Policy Considerations in Public-Private Partnership (PPP) Arrangements
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This 2009 FHWA report is intended to help frame public policy considerations in public-private partnership (PPP) arrangements. State legislatures and public officials have taken these considerations into account in PPPs. Each state's approach, however, varies depending on a number of factors, including the public sector's policy objectives, the interests of the users, the characteristics of the project and specific risk factors. This report examines how different states have responded to the issues most frequently raised by examining provisions in state law and PPP agreements. The report identifies and addresses 14 public policy issues related to PPPs, based on a review of Congressional and state legislative hearings, publications, and discussions with key federal, state and local decision makers. Each issue is addressed in a separate section that includes (i) analyses of how state transportation departments and other public authorities have addressed the public policy considerations in those areas and (ii) charts detailing legislative and contract provisions that have been used. The findings of the report are based upon the review of PPP agreements for several recent and ongoing partnership projects.
User
Guidebook on Implementing Public-Private Partnerships
for Transportation infrastructure Projects in the United States.
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This Guidebook is intended to assist sponsors
and providers of transportation projects take the necessary
steps and precautions to promote the successful delivery
of P3 project while protecting the public interest, especially
the ultimate users of facilities so developed.
Case
Studies of Transportation Public-Private Partnership
in the United States
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This report focuses on P3 applications to
transportation projects in the United States. It promotes
greater understanding of the role of institutional factors
in the implementation of P3s.
Case
Studies of Transportation Public-Private Partnership around
the World
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This report focuses on P3 applications to
transportation projects in England, Australia, New Zealand,
Hong Kong, India, Israel, Denmark, Sweden and Argentina,
and provides an overview of variety of projects and approaches
used to implement P3s around the world.
Synthesis
of Public-Private Partnership Projects for Roads Bridges & Tunnels
from Around the World - 1985-2004
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This August 2005 report presents a synthesis
of a comprehensive database of highway infrastructure projects
from around the world financed or delivered through some
form of public-private partnership (P3). This synthesis provides
insights into the nature and extent of highway infrastructure
projects that have and are being advanced through various
types of P3 contractual arrangements. They also reveal the
predominant types and sizes of P3 contracts used in various
regions and countries around the world for developing different
types of highway infrastructure, including roads, bridges,
and tunnels. The results of this synthesis are intended to
inform those involved in the development, funding, or delivery
of highway infrastructure regarding the worldwide use of
P3s to delivery highway and other forms of public use infrastructure.
FHWA
Report to Congress on P3s
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This report, issued in December 2004 by U.S.
DOT, answers the questions posed by Congress and attempts
to provide a resource document for States interested in using
public-private partnerships as a method of procurement. The
report is divided into five major sections: history and initiatives,
value of public-private partnerships, impediments to their
formation, stakeholder comments, and recommendations for
removing those impediments. The value section is designed
to help States considering public-private partnerships better
understand the benefits of such an approach and some of the
downsides. This report, however, is not designed to be a
manual on how to use public-private partnerships as part
of a State program. We have not addressed the myriad issues
concerning when public-private partnerships should be used
and how they should be negotiated. The report focuses on
the questions posed by the House Report language and provides
the background necessary to provide context for the answers
to those questions.
FHWA
Office of International Programs: Contract Administration:
Technology and Practice in Europe
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In June 2001, a team comprised of Federal,
State, contracting, legal, and academic representatives traveled
to Portugal, the Netherlands, France, and England. Their
mission was to investigate and document alternative contract
administration procedures for possible implementation in
the United States.
The scan team discovered that European highway agencies appear to be better at exploiting the efficiencies and resources that the private sector offers, through the use of innovative financing, alternative contracting techniques, design-build, concessions, performance contracting, and active asset management. European agencies have created contracts that focus on the users, while seeking to allocate risk appropriately and establish an atmosphere of trust in the implementation of procedures. The United States can directly and immediately employ many European procedures to help cope with its most urgent transportation needs. The report discusses these European techniques in terms of procurement, contract types, and payment mechanisms.
The report addresses the following subjects: best-value selection, performance specifications, design-build, shadow tolls, public-private partnerships, concessions, and design-build-operate-maintain.
Public-Private
Partnerships for Highway Infrastructure: Capitalizing on International
Experience
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FHWA, AASHTO, and NCHRP sponsored a scanning study to collect information
about P3 programs for highway infrastructure in Australia, Portugal, Spain,
and the United Kingdom, where P3 experience is more extensive. In this publication,
the scan team reports that P3s are an effective strategy for delivering highway
projects, and they are service arrangements as much as financial ones. The
team observed that potential P3 projects must be analyzed and structured
thoughtfully to preserve public interests and that managing the partnership
over the life of the contract is critical to providing the services expected.
Team recommendations for U.S. implementation include convening workshops,
developing training guidelines, establishing an expert task group, developing
a research strategy, and publishing principles and guideline documents on
P3 topics.
FHWA
Innovative Finance Quarterly
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This
quarterly newsletter, published by FHWA, provides information on the latest
developments in Federally-sponsored innovative finance programs, such as
TIFIA, GARVEE Bonds, and SIB transactions. It also features descriptions
of innovative projects and programs of interest launched by state DOTs
around the country. The newsletter also tracks legislative
changes. Copies of all issues of the Quarterly dating back
to 1997 are available on the FHWA Innovative Finance website,
together with copies of FHWA's earlier Innovative Finance
Newsletter.
FHWA
Financing Freight Infrastructure Guidebook
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This guidebook developed by FHWA's Office of Freight Management and Operations
and Office of Planning provides information on funding financing tools available
for freight improvements and case studies of freight financing. Private sector
options for financing freight needs are presented and noted among the case studies
were relevant.
