PPPs are based on long-term traffic and economic forecasts. Over-estimations are possible, and private firms could find themselves with insufficient revenue to repay investors. This could lead to the government buying back roads, or higher tolls and poorer management if permissible. The structure of the PPP will determine which party bears the risk of default.24
It should be clear to the public, prior to finalizing the PPP agreement, what would happen in the event of default.