Business Leaders for Transportation's recommended guidelines for ensuring the proper use of public-private partnerships for transportation infrastructure.
Public-Private Partnerships are a useful tool that, when used properly, can help deliver quality multi-modal transportation infrastructure statewide, while minimizing the state's need to raise additional public revenue or take on hefty new debt. As Illinois considers adding this tool to its box of funding mechanisms, the state must also decide on its appropriate use. The public must be assured that Public-Private Partnerships will be used for our benefit, and be selected through an accessible planning process. The following principles should guide the use of Public-Private Partnerships in Illinois:
Approved by a Regional Planning Process
Public-Private Partnerships only benefit the long-term interests of the state when they are used for projects that have already been approved by a transparent and rigorous regional planning process. Public-Private Partnership projects should reflect priorities set by metropolitan planning organizations, counties and municipalities and be in accord with regional plans for growth and transportation. Project details should be made public well in advance of local or state approval, including the use of the state and/or municipal revenue for and from the Partnership.
Subject to Special Scrutiny
Regional planning agencies should seek out best practices and develop a special review process for projects that could attract Public-Private Partnerships, being especially sensitive to any hidden costs and public expectations of the parameters of such projects. The availability of private capital to help build new toll highways, in particular, should not skew the appropriate balance of mobility options of the region or state; an unregulated program of new toll highways could generate paralyzing financial costs and reverse a fledgling trend toward redevelopment and clustered, mixed use development. The regional planning agency should also work with the contracting agent on making sure that the public’s expectations of parameters are reflected in the contract and regulation process.
Reinvested in Appropriate Areas
The revenue generated by the state or municipal agent through a Public-Private Partnership should be reinvested in transportation facilities and programs that meet the stated goals of regional planning bodies. Regional planning bodies should use Partnerships as an opportunity to generate more funding for long-term solutions to the region’s mobility issues, especially mass transit and rail freight. Furthermore, revenue generate from Partnerships should be primarily used for capital purposes, not operating expenses as this revenue is essentially akin to bond financing.
Read "Making the Case for Public-Private Partnerships in Illinois."