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The Build America Center is proud to introduce our latest publication, the ‘Risk Allocation and Sharing in Transportation P3s: State of Practice Report, Version 1 | October 2023.’ This comprehensive report delves into the landscape of public-private partnerships (P3s) in the transportation sector over the past two decades, shedding light on the evolving practices of risk allocation and sharing.
In the 2022-2023 fiscal period, the BAC meticulously examined 26 P3 transportation project contracts, assessing how 30 general, construction, and operation risks were allocated. Notably, the report highlights the predominant transfer of risks related to construction, finance, operation, project company ownership, and handback to the private sector. The public sector retained only two risks, confirming the risk transfer tenet of P3s.
Interviews with 14 experienced practitioners further enriched the findings, emphasizing the challenges posed by risks related to geology/site conditions and third-party involvements. The report recommends mitigation strategies such as allowances, deductibles, timely decision-making, and transparent communication about risks.
This report serves as a valuable resource for public agencies, private participants, and industry stakeholders, offering insights into current practices and issues with risk allocation in transportation P3s.
We appreciate your continued interest in the Build America Center and its commitment to advancing knowledge and best practices in the field of public infrastructure development.