The concept of public sector agencies and private sector firms working together in a partnership arrangement is not a new concept. For centuries this is how major infrastructure facilities such as roads, aqueducts, canals, and cathedrals were built. It was only in the early part of the last century that the advent of functional specialization, engineering sophistication, and efforts to prevent corrupt procurement practices did a virtual "steel wall" arise between public agencies which sponsored and often developed and maintained transportation infrastructure and private firms whose roles were limited to specialized services such as engineering design and construction. The result was the creation of the design-bid-build process of project development, in which design plans are produced prior to and independent of project construction.
This bifurcated process limited private sector involvement to these two primary roles which were kept contractually separate to avoid collusion and fraudulent claims. However, it also eliminated the opportunity for synergy between these two interrelated functions of design and construction. This often resulted in delayed design plans being rushed to meet inflexible construction bid letting schedules, leading to greater opportunities for errors and omissions frequently caused by site conditions not being adequately investigated prior to completing the plans. This left the contractor to discover and address these problems during the construction phase of the project, often delaying the project and driving up its cost.
The lack of trust by transportation agencies in the design and construction firms hired to execute these interrelated functions produced an inefficient project development approach that continued as long as transportation agencies had ample financial and staff resources to pay for these inefficiencies. However, as the growth in transportation infrastructure needs began to outpace the growth in transportation program resources, public agencies began to consider alternative project delivery approaches that involved private firms as project partners to help narrow the gap between transportation needs and public resources. This led to the development (or rediscovery) of various public-private partnering approaches involving different combinations of responsibilities and risk-taking for private and public partners working in collaboration.