• Build-Own-Operate: a private contractor constructs and operates a facility while retaining ownership. The private sector is under no obligation to the government to purchase the facility or take title. "Public-Private Partnerships: Terms Related to Building and Facility Partnerships." GAO/GDD-99-71, April 1999, http://www.gao.gov/special/pubs/Gg99071.pdf
• Concession Benefits: rights to receive revenues and other benefits (often from tolling) for a fixed period of time.
• Construction Manager at Risk: hired construction manager (CM) begins work on the project during the design phase to provide constructability, pricing, and sequencing analysis of the design. The CM becomes the design-build contractor when a guaranteed maximum price is agreed upon by the project sponsor and CM. (32 CFR 636.103)
• Design-Bid-Build: the traditional project delivery method where design and construction are sequential steps in the project development process. (32 CFR 636.103)
• Design-Build: an agreement that provides for design and construction of improvements by a contractor or private developer. The term encompasses design-build-maintain, design-build-operate, design-build-finance and other contracts that include services in addition to design and construction. Franchise and concession agreements are included in the term if they provide for the franchisee or concessionaire to develop the project which is the subject of the agreement. (23 CFR. 636.103)
• Developer Financing: a type of financing where a private party finances the construction or expansion of a public facility in exchange for the right to build residential housing, commercial stores, and/or industrial facilities on the site. This type of financing often takes the form of capacity credits, impact fees, or exactions. "Public-Private Partnerships: Terms Related to Building and Facility Partnerships." GAO/GDD-99-71, April 1999, http://www.gao.gov/special/pubs/Gg99071.pdf
• Electronic Toll Collection: the use of electronic devices such as transponders, cameras, and photo-recognition technology to identify, classify, and toll vehicles entering and/or leaving a toll highway, bridge, or tunnel without the need for direct human involvement in the process or the handling of cash.
• Innovative Contracting: innovative contracting practices meant to improve the efficiency and quality of roadway construction, maintenance, or operation. Examples of innovative contracting include: A+B contracting, lane rental, the use of warranties, design-build, design-build-operate, design-build-finance-operate-maintain.
• Innovative Finance: innovative methods of financing construction, maintenance, or operation of transportation facilities. The term innovative finance covers a broad variety of non-traditional financing, including the use of private funds or the use of public funds in a new way, e.g., GARVEE bonds or special tax districts.
• Life-Cycle Costs: the costs of a project over its entire life: from project inception to the end of a transportation facility's design life.
• Public-Private Partnership: a contractual agreement formed between public and private sector partners, which allows more private sector participation than is traditional. The agreements usually involve 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 (e.g., A+B contracting), to development agreements that can be very complicated and technical (e.g., design-build-finance-operate-maintain). In the context of this report, the term public-private-partnership is used for any scenario under which the private sector would be more of a partner than they are under the traditional method of procurement. Further, the broad definition used for public-private partnerships includes many elements that are applied fairly regularly on appropriate projects. "Public-Private Partnerships: Terms Related to Building and Facility Partnerships." GAO/GDD-99-71, April 1999, http://www.gao.gov/special/pubs/Gg99071.pdf
• Revenue Bonds: instruments of indebtedness issued by the public sector to finance the construction or maintenance of a transportation facility. Revenue bonds, unlike general obligation bonds, are not backed by the full faith and credit of the government, but are instead dependent on revenues from the roadway they finance. Terms Related to Public-Private Partnerships, The National Council for Public-Private Partnerships: How Partnerships Work, http://ncppp.org/howpart/pppterms.html
• Shadow Tolling: Shadow tolls are per vehicle amounts paid to a facility operator by a third party such as a sponsoring governmental entity. Shadow tolls are not paid by facility users. Shadow toll amounts paid to a facility operator vary by contract and are typically based upon the type of vehicle and distance traveled.
• Toll Credits: toll credits are earned when a State, a toll authority, or a private entity funds a capital highway investment with toll revenues from existing facilities. States may increase the use of available eligible Federal funding on a project, up to the normal State/local matching amount, and debit the sum of the toll credits that have been earned by that same amount.
• Tolling: the process of collecting revenue whereby road users are charged a fee per roadway use. Tolls may be collected on a flat-fee basis, time basis, or distance basis and may vary by type of vehicle.
• Warranty: when used in public-private partnerships for the construction of roads, warranty clauses guarantee that the roadway will meet a certain level of quality or else repairs will be made at the private contractor's expense. There are currently two types of warranties used in highway construction: (1) materials and workmanship warranties and (2) performance warranties. Under the first type, the contractor is responsible only for defects caused by poor materials and workmanship. Under the latter, the contractor is responsible for the product meeting certain agreed upon performance thresholds, regardless of whether materials and workmanship met State standards.