News
No Simple Calculation in Comparing Public, Private Investment. . . .One reason why government officials and investors are looking at public-private partnerships is the high cost and long lead time of traditional infrastructure – Boston’s Big Dig being the notorious example. But the public infrastructure process is complex and rule-bound because of built-in checks against theft and corruption, suggested Capuano. “We got where we are because for a hundred years public and private people stole money repeatedly on massive public projects and, little by little, we threw laws in the way… to make it a little harder to steal money,” he explained, but “we end up with this crazy system” under which “we Balkanize every single step of the way.” It’s also necessary to assess whether revenues coming from the public paying tolls or fees are being used to improve public transportation — or merely to plug short-term budget holes. Roll Call (blog)
New York Financiers Weigh In on Public-Private Partnerships. When members of the House Transportation Committee trekked to this morning to Manhattan for a roundtable discussion on private financing for public projects — also known as public-private partnerships, or P3s — with financiers from J.P Morgan and other firms, they got a message of both opportunity and caution. Roll Call (blog)
What if we made transportation systems regulated public utilities?. . . David Levinson, a professor who specializes in transportation issues at the University of Minnesota, says that there’s no need for us to live with such shabby transportation or for government to continue shell out bigger and bigger subsidies. In a story recently published on the Atlantic Monthly’s CityLab website, Levinson makes the case for returning to private ownership — kind of. He would like to see our transportation systems, even the highways, operate as highly regulated public utilities. MinnPost.com
RI: Social impact bonds legislation advances in Senate despite strong union opposition. Supporters hope the bonds can provide a way of financing social programs for the homeless and incarcerated that the state otherwise could not afford. Opponents worry that it is a risky, untested funding model that could be used as a back-door approach to privatizing social programs. “We just see this could be a back-door way to privatize the delivery of social services programs … and to most likely reward wealthy investors while you’re at it,” said Jim Cenerini, a lobbyist for Council 94, American Federation of State, County and Municipal Employees. The legislation advanced last week defines a “social impact bond” as “a contract between the public and private sectors in which a commitment is made to pay for improved financial and social outcomes that result in public sector savings.” The Providence Journal
NJ: Bill regulating privatization efforts heads to Christie’s desk. A bill that Democrats say would guard against “irresponsible” plans to outsource government services is heading to Governor Christie’s desk. The bill, which passed the Assembly 48-30 today, would forbid privatization unless real cost savings could be shown. In addition, the work environment, including wages would have to stay the same or be better than the public sector and there would also be public disclosure requirements. NorthJersey.com