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CBO Finds Private Roads (Slightly) Faster and Cheaper
A handful of studies on public-private partnerships, or P3s, in highway construction suggest that such arrangements have built highways slightly less expensively and slightly more quickly, compared with the traditional public-sector approach, a Congressional Budget Office researcher told a special House Transportation & Infrastructure Committee panel on March 5. CBO cautioned, however, that data on P3s in highway projects are scarce, so its difficult to conclude definitively that other P3 projects would see similar results.Right. Only climate scientists can make rock-solid projections based on a little historical data. The costs of financing a highway project privately is roughly equal to the cost of financing it publicly once you factor in costs associated with the risk of project losses which taxpayers ultimately bear and the financial transfers made by the federal government to states and localities, Kile told the panel. Any remaining difference in costs results from the effects of incentives and conditions established in the contracts that govern P3s, he said. Kile also emphasized that private financing increases the availability of highway construction funds only if the state or local government restricts its spending through legal constraints or budgetary limits. How many of the 57 states have NOT maxed out their highway budgets?  The reason is that revenues from the users of roads and from taxpayers are the ultimate source of money for highways, regardless of the financing mechanism chosen.Pardon me, Mr. CBO guy? The public pays, either way? Are you tellin' me there ain't no sucha thing as a free lunch? The House T&I Committee established the special panel in January to explore the use of and opportunities for P3s across all modes of transportation, economic development, public buildings, water, and maritime infrastructure and equipment. Posted by: Bobby 2014-03-10 |
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