US P3: misapplied availability payments risks

Author: Danielle Myles | Published: 27 Sep 2011

US government agencies should resist taking the traffic risk in road and bridge public-private-partnerships (P3) for political reasons. Instead they should look to other countries’ precedents which achieve similar goals through sharing the risk, according to P3 experts.

Counsel have noted a trend of public sponsors structuring, or considering structuring, these deals using availability payments rather than as pure revenue projects for political expediency.

Their objectives can include maintaining control of the project, including tolls and subsidising those when necessary, and having the public reap the rewards of a successful project.

But P3 experts have warned against this approach.

"I think we should be very cautious about...


 

 

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