Thursday, February 14, 2008

GAO Report: U.S. Department of Transportation promotes 'Public Private Partnerships,' but gives little consideration to public-interest concerns

Public-private deals could benefit highways: GAO

February 14, 2008

R.G. Edmonson
Journal of Commerce
Copyright 2008

WASINGTON D.C. --While public-private partnerships can lead to improvements in highway infrastructure, the Government Accountability Office warns that there is no "free money" in the deals.

In a report issued Friday, the GAO recommended that the federal government and the private sector develop objective criteria to identify what the public interest would be in a public-private venture.

The report said that while there are cost benefits to public-private partnerships (3Ps), they could be overshadowed, for example, if a private toll road operator uses its market power to charge excessive tolls. Where 3Ps have been successful, the government has established performance and other standards at the outset.

Washington has had little experience so far with 3Ps, but the Department of Transportation has been actively promoting them.

So far little consideration has been given to public-interest concerns, the report said. The DOT disagreed with several findings in the report.

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