24-hour match: 2x your gift’s impact today! Double my donation
Transportation Nation

Paying for transportation with public-private partnerships

Marketplace Staff Jan 12, 2011
Transportation Nation

Paying for transportation with public-private partnerships

Marketplace Staff Jan 12, 2011


STEVE CHIOTAKIS: Congress suspended work this week, after the shooting tragedy in Arizona. But when members reconvene, one of the first things they’ll have to deal with is how the country will go forward paying for big transportation and infrastructure projects. Budget cuts are on the agenda. And some groups say the private sector can play a bigger role.

From the Transportation Nation reporting project at WNYC, Andrea Bernstein reports.

Andrea Bernstein: In Wilkes Barre, Penn., not too long ago, I had a conversation with resident Debbie Horuschock about whether she thought the government should be spending money on things like roads, bridges, and railroads.

Debbie Horuschock: They should all be fixed.

Bernstein: You think that would be a good thing to spend money on?

Horuschock: No. But they should be fixed.

Construction company executives aren’t laughing, though. Mike McNally is the president and CEO of Skanska USA. Here’s how he describes what it’s like to build a huge piece of infrastructure:

Mike McNally: You know, start stop, start stop.

That’s what happened in New Jersey when a Democratic governor started a $9 billion commuter rail tunnel under the Hudson River. A year and a half later, his Republican successor killed the project, saying he was afraid of cost overruns.

McNally says it’s time to do things differently. Instead of having the government pay, draw up a contract with a private construction firm — let it design, build, and run the project. In exchange, that company gets to collect any revenue the project produces.

McNally: It’s the most fair way to do it when you think about it, because the person that’s say using that say bridge or tunnel or whatever is actually paying for the use, not somebody in Nevada.

McNally says many Asian, European and South Americans countries, like Chile, won’t build any big projects without these partnerships.

There are critics. The U.S. Public Interest Research Group’s Phineas Baxandall says they’re not really happy marriages.

Phineas Baxandall: They’re often more like shotgun weddings where the desperate state or city is forced to accept some kind of upfront local cash in order to give a long term concession.

But still. Public-private partnerships are winning converts. The U.S. Transportation Department is getting behind them, and so is the new Republican chair of Congress’s Transportation Committee.

In New York, I’m Andrea Bernstein for Marketplace.

HOST: For more information on the Transportation Nation project, click here.

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.

Don’t miss this match!

Donate today and your gift will be matched dollar-for-dollar by the American Public Media Board.