Stanford Webinar: Infrastructure Project Finance

About this Video

• Video Title: Stanford Webinar: Infrastructure Project Finance
• Channel: Stanford Online
• Speakers: Michael Bennon
• Duration: 00:53:25

Introduction

This webinar focuses on infrastructure project finance, specifically examining why the public-private partnership (P3) model, common in other developed countries, is less prevalent in the United States. The presentation uses data and a case study (Long Beach Civic Center) to analyze the reasons for this discrepancy and offers policy recommendations for increased adoption of the P3 model in the US.

Key Takeaways

• Limited P3 Adoption in the US: The P3 model for infrastructure projects is used significantly less in the US compared to countries like Canada and Australia, despite increasing demand.
• High Project Cancellation Rate: A high rate of project cancellation in the US contributes to the lower adoption of the P3 model.
• Shifting Funding Responsibility: A shift in infrastructure funding from the federal to state and local governments in the US has created challenges for the adoption of P3s, as local agencies may lack the capacity to manage these more complex procurement models.
• Institutional Barriers: Existing US public institutions, particularly at the state and local levels, are not optimally structured to handle the lifecycle cost considerations inherent in P3 projects. The formation of specialized P3 agencies in other countries has facilitated wider adoption.
• Policy Recommendations: Federal support for mega-projects, improved loan programs, access to municipal bond markets, and institutional support for state and local governments to adopt P3s are recommended. Funding for innovative programs rather than just focusing on economic benefits is also suggested.
• Long Beach Civic Center Case Study: The Long Beach Civic Center project successfully utilized a P3 model by addressing deferred maintenance concerns, leveraging unused land, and implementing performance-based maintenance requirements.