Like TURF
Follow TURFNY Comptroller: Proceed with caution on public-private partnerships
No such caution can be found in Texas. It's a public private partnership lovefest down here from the Governor on down...the public interest and affordable travel be scorned.
Comptroller: Proceed with caution on public-private partnerships
By Cara Matthews
June 5, 2013
lohud.com
Strong oversight provisions need to be in place if New York broadens the authority of the state to enter into public-private partnerships or privately finance public projects, state Comptroller Thomas DiNapoli said in a report today that looks at public-private partnerships in other parts of the country.
In December 2011, the state has authorized five state agencies and public authorities to use a simple form of public-private partnership called design-build contracting. The Thruway Authority is using design-build contracting for the new Tappan Zee Bridge, meaning design and construction services are awarded to the same contractor. The approach is expected to streamline the project, shift some financial risk to private contractors and save the Thruway Authority money.
The comptroller urged policy makers to obtain a full understanding of the potential benefits and costs of public-private partnerships before taking further action. A number of states have permitted such projects, but none has granted unilateral authority to any state agency to pursue these kinds of agreements. Private debt and other payments associated with public-private partnerships can be costly, and long-term agreements can impact the public for decades, he cautioned. States with poorly drafted public-private partnership agreements have found them to be expensive and hard to correct, the report said.
“New York’s aging infrastructure needs to be rebuilt and repaired but the state’s ability to pay for this important work is limited,” DiNapoli said in a statement. “If New York allows private companies to finance public infrastructure projects, they should protect taxpayers and include safeguards to avert costly mistakes down the road. This may seem like an easy-money solution to a complex and growing problem, but poorly structured agreements have significantly cost taxpayers in other states.”
Other recommendations are: Create a specialized entity to oversee public-private partnerships; develop staff expertise to evaluate and manage agreements to ensure taxpayer interests are protected; require independent evaluations of relevant cost-benefit analyses; require complete financing plans subject to independent review and approval before contracts for the project are finalized; require competitive bidding; and require an independent review and approval of projects by the comptroller.
This is DiNapoli’s second report on public-private partnerships. His first was in January 2011.