This final chapter presents conclusions regarding the use of PPP approaches to leverage public resources with the capabilities and resources of the private sector firms seeking to participate in the development, financing, implementation, and/or operations and maintenance of transit fixed guideway facilities
In recent years transit agencies have begun to reconsider the potential role and involvement of the private sector in transit capital investments and operations. PPPs are among the most effective ways other transportation sectors have controlled the costs of infrastructure development and operation while increasing program resources. As a result, many transit agencies are considering various approaches to engage the private sector in some form of PPP to leverage public resources, lower costs, improve services, and transfer risks associated with fixed guideway design, construction, financing, operations, and maintenance. Their intent is to minimize the level of public subsidy required by public transit facilities and services while protecting the social benefits delivered by transit. While it is unlikely that public transportation services can become fully self-supporting, PPPs can reduce the level of public subsidy while improving services to patrons. PPPs:
• Reduce the costs of transit facilities through the use of more cost-effective alternative project delivery approaches, better management of project risks, and life-cycle preservation through the application of asset management principles.
• Expedite the delivery of transit facilities (new, expanded, or rehabilitated), keep them in a state of good repair, and maintain an attractive travel environment (stations, access ways, parking lots/garages) to attract and retain patrons and increase farebox revenues.
• Improve the efficiency of transit services by adopting more cost-effective operating practices and resources.
• Quicken the pace of adopting more cost-effective new technologies that can improve patron services and reduce capital and/or operating costs.
These strategies are aimed at minimizing the level of public subsidy required by transit agencies (referred to earlier as subsidy minimization) and placing essential public transportation facilities and operations on a firmer customer service and fiscal foundation with less uncertainty and greater accountability. By working together as partners, experience over the past decade has shown that public transit agencies and private firms with access to best practices, capital resources, and risk management techniques can often realize these outcomes more cost-effectively than by working separately.
While some argue against the use of PPPs for fixed guideway projects due to the perceived lack of farebox revenue for the private sector partners, it is becoming increasingly clear that transit agencies can access alternative sources of revenue for the private partners and make their payments contingent on availability and other performance related factors, which can measure the private partners' performance through the life of the contract.
With many PPP arrangements possible, the kind of private sector involvement can vary by function, service, project, and agency. Some kinds of partnership arrangements may not be appropriate or beneficial in certain cases while in other instances a PPP can turn a troubled fixed guideway project or service into a success. The essence of a PPP is that it is based on a true partnership, where both the public agency and private partner are involved in ways that maximize their contributions to the project based on their respective capabilities.