Until recently, the majority of PPP projects in the United States did not involve long-term equity investment by the private sponsors. These teams, typically led by large US construction and engineering firms would risk substantial sums in developing proposals and bringing them to financial close, but they sought the return on their "sweat equity" primarily through developer fees paid at close of financing and through profit built into the associated design-build contracts. Long-term equity investments were also discouraged by tax laws that made such projects ineligible for lower-cost tax-exempt debt financing.
The last year has seen a resurgence in projects to be developed using the "concession" model, with project sponsor's equity at risk to the long-term performance of the project. This change is in part a result of the provision in SAFETEA-LU authorizing $15 billion in tax-exempt private activity bonds, and in part from entry into the US market of international players with experience in billions of dollars of projects financed under the private the concession model throughout the rest of the world. As noted above, the concession approach is currently being utilized in procurements for numerous new projects in Texas, Oregon and Florida.