The private sector has long participated as a close partner with the public sector in designing and constructing surface transportation facilities, generally under individual contracts between public-sector sponsors and private firms with specific relevant capabilities. Individual private investors have also long been financial partners in transportation projects by purchasing tax- exempt bonds that support projects delivered by the public sector.
Today, the private sector is taking on far greater risk and responsibility through an emerging class of comprehensive contractual arrangements to not only deliver projects but also to operate, maintain, and finance them, thereby providing greater financial certainty and more efficient performance for the public sector. Because these financial arrangements are relatively new in the United States and can be quite complex, they have raised a number of policy issues and concerns.
This section briefly summarizes the forms that private-sector financial participation may take, identifies key advantages and disadvantages, and addresses related public policy concerns. The discussion of areas for potential refinement, particularly in terms of potential federal action, serves as the context for the Commission's specific recommendations in Chapter 8.