“If you’ve seen one public-private partnership (P3), you’ve seen one public-private partnership,” was a recurring theme in the “Financing New Projects in the U.S.” session. This concept, echoed by more than one presenter, acknowledged the fact that these partnerships are all so different.
According to Sherry Little, partner and co-founder of Spartan Solutions, the most successful P3 projects were those where the public sector allowed the private sector to innovate. Other lessons learned from P3s, she said, were the emphasis of State of Good Repair projects, which made good candidates for P3 partnerships, as well as the importance of incentives in the process. Little referenced a particular project where the incentive was providing a stipend to public transit. She says incentives help defray costs and show the industry public transit is serious about delivering projects via P3s.
David Narefsky, partner, Mayer Brown, touted examples of transit projects in Canada, such as Vancouver’s Canada Line, where the use of P3s has “more traction and maturity.” He said that sometimes when you are developing projects in the U.S., “you have the feeling you are reinventing the wheel.”
According to Blackhill Partners’ Greg Moore, the first optimum model of a P3 was the Transcontinental Railroad.
“It is in the strategic interest of the government to get these projects built,” he said.
He also discussed ways the government can infuse value in projects by accelerating permitting and providing low-cost access to rights-of-way; low-cost, long-term financing; and significant in-kind equity.
Adam Giuliano, sr. associate, Freshfields Bruckhaus Deringer, focused on the importance of the procurement stage, risk allocation, payments and the ability to refinance projects.