Financial Structuring of Public-Private Partnership (P3) Concessions [fact sheet]
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2022-07-18
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Abstract:Under a Public-Private Partnership (P3) for construction of highway projects, a private partner participates in a long-term contract with a public agency involving some combination of design, construction, financing, operations, and maintenance, including collection of toll revenues. A long-term contract involving financing is a form of highway P3 called a "concession." A concessionaire invests its own funds (known as "equity") and borrows additional funds to pay for construction of a highway project. The concessionaire then maintains and operates the project for a specified period and expects to be repaid for its investment in the project over the period of the concession.
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