The decision to pursue a PPP project should be supported by analytical processes that show the PPP procurement as a better option than traditional procurement or public provision. The valuation process should include the careful selection of inputs/variables that properly characterize the chosen procurement method and risk allocation, using quantitative methods that include sensitivity analysis to better assess the risk variables for a particular project. Several states in the United States, including Florida and Alaska, as well as the United Kingdom, Victoria (Australia), and British Columbia have widely used "value for money" as a tool to assess PPPs. Other methods have also been used in the United States, including shadow bids and market valuation in Texas, and asset valuation in both Chicago and Indiana, to set a minimum value for the proposed project. Proper development and use of valuation tools is potentially one of the most important means of helping the public and elected officials better understand the benefits, costs, risks, and rewards of PPPs.
Opinion/Comment from "Other Individuals/Interest Groups" Survey: Need to adopt level-playing-field competition procedures, to permit fair competitions that do not tilt toward either public-sector or private-sector bidders. |