july2017

102 103 AIAI infrastructure asset. Too often, the maintenance of these assets is subject to unidentified or inadequate funding, and delayed, time after time, until the asset falls into disrepair, short- ening its design life and necessitating early replacement and eroding public confidence in government services. One of the key components of a P3 relates to ongoing operations and main- tenance (O&M) activities that sustain assets for their full-service life. During the procurement of the project, the public owner and private partner determine the appropriate service levels and per- formance standards necessary for the full duration of the O&M period, often 30 to 50 years. It’s also worth noting that a P3 is not a one- size-fits-all contract – it’s an incredibly flexible model that is only limited by the public entity’s ability and willingness to explore new infra- structure delivery methods. Most importantly, P3s allow private sector in- vestors to put skin in the game. These investors help finance a project to ensure the project is built on time and on budget. If it’s not, the gov- ernment can withhold payment. That’s called risk transfer, and in a P3, it means taking away risk from the taxpayer and transferring it to the private sector. That’s just good policy. THE STATE OF P3S Two creative examples of the implementation of alternative project delivery come to mind which showcase the value proposition of P3s. First, the Pennsylvania Department of Trans- portation (DOT) used the P3 model as a way to fix over 500 structurally deficient bridges located throughout the state, largely in rural areas. In Michigan, the Michigan DOT used the P3 model to design, construct and finance the replacement, operation and maintenance of 15,000 lighting fixtures and the underlying infra- structure throughout Detroit.This innovative use of the project deliverymechanism allowed Mich- igan DOT to get out of the lighting business, save money, reduce maintenance headaches, and focus on their core business of transportation.Michi- gan DOT estimates that this project will generate approximately $13 million in savings. So what’s holding back the increased adop- tion of P3s at the federal, state and local level? One key issue is the lack of legislation, which limits P3 implementation in more transpor- tation and vertical (e.g., courthouses, prisons) infrastructure projects—and that’s where the non-profit, AIAI – the Association for the Im- provement of American Infrastructure has made a difference. P3 ADVOCACY AIAI was founded by leading infrastructure developers in November 2012. Today, the or- ganization is the leading pro-P3 organization in America. Our sole focus is to advocate for legislation and policy changes that enable P3s to grow nationally with an emphasis on good policy that’s good for the community. At AIAI, our motto is to educate, advocate and engage. AIAI’s membership includes many of the lead- ing companies building America’s infrastructure.