PUBLIC-PRIVATE PARTNERSHIPS (P3)
According to the US Department of Transportation, public-private partnerships are contractual agreements between public agencies and private entities that provide greater private participation in the delivery and financing of transportation projects compared to the traditional design-bid-build public procurement model. A P3 is defined as a public infrastructure using private finance in a long-term partnering agreement. Under the traditional approach, project sponsors execute separate contracts for the design of projects and then for their construction, and then they operate and maintain the infrastructure following construction.
The Belle Chasse Tunnel & Bridge Replacement Project is a Design-Build-Finance-Operate-Maintain P3.
Under the DBFOM procurement approach, the responsibilities for designing, building, financing, maintaining and operating are bundled together and transferred to private sector partners. Also known as “concessions,” DBFOM procurements provide project sponsors with cost and acceleration benefits and the added benefit of maintenance over a longer term. In addition, they transfer financial risk to the private sector partner and provide owners with access to new sources of financing, including private sector equity. The Belle Chasse project combines private funding, INFRA grant funding, state and federal funding to propel the effort forward.