The U.S. Department of the Treasury recently published an Economic Framework for Comparing Public-Private Partnerships and Conventional Procurement.
The department concluded that there is no single factor that should determine whether a P3 is likely to yield a stronger benefit than one delivered through conventional means. The paper also outlines important steps for a government to take before procuring a P3 project to ensure optimal benefit to the taxpayer.
One key factor cited in the report was the capacity of a project to bundle several projects into one large contract. The capacity to bundle is by far the most important factor in a P3 creating cost savings, the report concluded.
Other important considerations were:
- Private-sector expertise: A strong indicator of whether the project will provide a net-benefit over the full life cycle of a P3 is the technical expertise available.
- Clearly defined terms that are quantifiable: How precisely does the contract lay out the service level required?
- High capital costs and long lived assets: Assets procured using a P3 need to be large enough to generate cost savings that offset the transaction costs of privately raised capital.
Related Stories
| Mar 27, 2013
New BACnet standard offers significant improvements to alarm handling
Changes to the newly published BACnet standard from ASHRAE will encourage smart building automation controls systems including alarms.
| Mar 27, 2013
CEIR releases tool that measures energy, environmental benefits of roof systems
The Center for Environmental Innovation in Roofing (CEIR) released its new RoofPoint Energy and Carbon Calculator that is designed to help roofing professionals measure the energy and environmental benefits of modern roof system technologies.
| Mar 27, 2013
Sustainable wood controversy leads to LEED ‘backlash bill’ in Florida House
A Florida House bill that says state agencies should decide on a project-by-project basis which green certification standards are used on state construction passed a subcommittee vote 12-1.
| Mar 19, 2013
Colorado Zero Energy District project shows how businesses can reach zero-energy standard
An ambitious experiment in Fort Collins, Colo., is supporting development of the nation’s first major urban zero-energy district.
| Mar 19, 2013
New LEED for Neighborhood Development and Historic Preservation guide released
A new guidance manual, LEED for Neighborhood Development and Historic Preservation, outlines strategies geared towards helping building teams incorporate historic resources into their developments.
| Mar 19, 2013
Senate bill would reform EPA’s lead renovation, repair, and painting rules
A bill to reform the EPA’s Lead Renovation, Repair, and Painting Rule (LRRP) was recently introduced in the U.S. Senate.
| Mar 19, 2013
Boston mayor’s energy efficiency disclosure rule under fire
A proposed ordinance in Boston mandating energy audits is coming under criticism from the Greater Boston Real Estate Board and others as being too costly and intrusive.
| Mar 18, 2013
USGBC to GAO: 'Schools need over $271 billion in maintenance fixes'
The Center for Green Schools at the U.S. Green Building Council (USGBC) has released its first “State of our Schools” report, highlighting the critical need to modernize school facilities to meet current health, safety and educational standards.
| Mar 14, 2013
Survey: Market demand now key driver for green construction
Construction firms across the world expect 60% of their projects to be environmentally friendly by 2015, according to the SmartMarket Report of McGraw-Hill Construction.
| Mar 14, 2013
Possible tax code changes prompt action from various industries, including construction
With Congress potentially tackling tax reform, businesses, trade groups and others are jockeying to get their voices heard.
