In Canada, an innovative way to rebuild roads, hospitals
British Columbia's 'private-public partnerships' have been touted as a model for the US to revamp its infrastructure.
British Columbia's political leader Gordon Campbell recently stepped aboard Vancouver's new light transit system and into the world's spotlight as one of the leading proponents of a burgeoning movement to twin the public and private sectors in building everything from bridges to roads and hospitals.Skip to next paragraph
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The Canada Line, a $2 billion light transit system running between Vancouver's downtown waterfront and the city's airport, is the latest in a string of public-private partnerships, or P3s, built in B.C. and being touted as a model for rebuilding America's infrastructure.
Typically, in a private-public partnership, government invests in the project, along with a private sector consortium which develops, builds, maintains, and operates the asset for a contracted period. The consortium often involves multiple international contractors, a maintenance company, and bank lenders.
While not everyone believes in the successful marriage of these seemingly unlikely business partners, California Gov. Arnold Schwarzenegger, for one, is a fan of B.C's P3 model.
Governor Schwarzenegger toured the Canada Line project site two years ago alongside Premier Campbell and has since been promoting B.C.'s experience as a template for financing and building public sector projects in California. He reiterated his praise for B.C.'s infrastructure partnerships following a meeting with President Obama last month to discuss future infrastructure projects – beyond the $787 billion federal stimulus package – that also included New York Mayor Michael Bloomberg and Pennsylvania Gov. Ed Rendell.
"We have 38 million people in the state, and we don't have great infrastructure," says David Crane, special adviser Gov. Schwarzenegger on economic and job matters. "We should have the greatest rail system, the cleanest water treatment plants in the country and we don't. Californians have grown accustomed to accepting this, but they deserve better."
State-of-the-art infrastructure is vital to California's economic sustainability, and public-private partnerships are the most viable method of delivering many public services because they lower costs and shorten timelines, Mr. Crane says.
British Columbia: a leader in 'P3s'
While public-private partnerships are still a relatively new concept in the United States, British Columbia has been using the P3 model for several years.