The Federal Highway Administration (FHWA) defines a public-private partnership as " ... a contractual agreement formed between public and private sector partners, who allows more private sector participation than is traditional. The agreement usually involves a government agency contracting with a private company to renovate, construct, operate, maintain, and/or manage a facility or system. While the public sector usually retains ownership in the facility or system, the private party will be given additional decision rights in determining how the project or task will be completed. The term public-private partnership defines an expansive set of relationships from relatively simple contracts to development agreements that can be very complicated and technical such as a design-build-finance-operate-maintain."34
In practice, these partnerships can describe a variety of different types of relationships between the government and the private sector. The potential advantage of such partnerships is that they can encourage private investment and innovation in transportation projects. Some may be concerned, however, that these partnerships can cause a state to lose control over a public facility. Public-Private partnerships are discussed in more detail in chapter six of this report.