Just a reminder that what are called "public private partnerships" are contracts, not partnerships
-- "Design-Build Team Makes Decision to Leave Maryland Purple Line Rail Project," Engineering News-Record
The State of Maryland signed a contract with a group of various firms to design, build, operate, maintain and partly finance the forthcoming Purple Line light rail line in Suburban Maryland. In turn, the group created a separate subsidiary to construct the line.
There are various disputes between the State and the consortium over delays and changes that result in greater costs and who is responsible for paying.
Because negotiations up to now haven't resulted in resolution, the construction firm has given notice per the contract to walk away.
Um, despite all the happy talk about "public private partnerships," in normal circumstances, that's not how "partnerships" are supposed to work.
Although this is not new. The reality is that these are contractual agreements, and very hard to change once underway. And as contracts, there is little interest in flexibility and changes and improvements once the construction is underway.
From "The Theory and Practice of Infrastructure Public-Private Partnerships Revisited: The Case of the Transportation Sector":
PPPs are widely promoted based on a narrative of improved collaboration between different stakeholders. By aligning the interests of the multiple parties to encourage closer and more productive working relationships, it is argued that public-private partnerships support innovative project designs and deliver value for money by better controlling project risks. Despite the promises, however, relationships between the various partners in PPPs have often turned from collaborative to confrontational, threatening the success of the project.
This is reality. And as a result, I think it's better to call these kinds of arrangements contracts, not partnerships.
I was trying to hook up with one of the teams that bid on this project. They didn't win. And the experience led them to abandon future efforts on such large scale projects (although the firm remains one of the nation's largest construction firms).
One of the problems with projects like this is that they are so few and far between (the same goes with manufacturing passenger transit vehicles of all types) that it's hard to build economies of scale.)
And early on in the post-bid acceptance process, I learned there was no room for innovative station area planning and development, etc., because "it's not in the contract."
-- "A Purple Line update: the downside of Public Private Partnerships" -- they are contracts, not partnerships," 2017
-- "It's not like transit "outsourcing" I mean "public-private partnerships" are necessarily smooth sailing," 2018
Which is one of the reasons why my brilliant writings around the Purple Line will have no effect.
-- "Revisiting the Purple Line (series) and a more complete program of complementary improvements to the transit network," 2019
-- Setting the stage for the Purple Line light rail line to be an overwhelming success: Part 1 | simultaneously introduce improvements to other elements of the transit network
-- Part 2 | the program (macro changes)
-- Part 3 | influences
-- Part 4 | Making over New Carrollton as a transit-centric urban center and Prince George's County's "New Downtown"
-- PL #5: Creating a Silver Spring "Sustainable Mobility District"
-- Part 6 | Creating a transportation development authority in Montgomery and Prince George's County to effectuate placemaking, retail development, and housing programs in association with the Purple Line
-- Part 7 | Using the Purple Line to rebrand Montgomery and Prince George's Counties as Design Forward
-- PL #5: Creating a Silver Spring "Sustainable Mobility District"
- Part 1: Setting the stage
- Part 2: Program items 1- 9
- Part 3: Program items 10-18
- Part 4: Conclusion
- Map for the Silver Spring Sustainable Mobility District
- (Big Hairy) Projects Action Plan(s) as an element of Comprehensive/Master Plans
- Creating the Silver Spring/Montgomery County Arena and Recreation Center
Labels: civil engineering, contract administration, development and construction, infrastructure, public private partnerships (3P), transit design and engineering
posted by Richard Layman @ 4:06 PM&Permanent Link
3 Comments:
Thanks for this write-up, I'd forgotten about or missed your original post.
So as structured, the P3 gives a strong incentive to have trains run on schedule and keep the infrastructure in good repair but does not have an incentive to better integrate with the larger system.
In theory that shouldn't be a problem though, right? The ridership risk resides with the state, who gets the fare revenue and could negotiate to have the contractor make an upgrade. We've even seen a couple of those, e.g. the Riverdale station switch to being a bridge.
I think Maryland is not that interested at the margins at the moment for spending more for better service, so it's somewhat of a moot point, but if some future Governor came along that wanted to do Crossrail, would the P3 arrangement be an obstacle? The concessionaire does have a monopoly of sorts, so they try to drive up profit margins on any new investments outside of the base contract. On the other hand, in one sense the concessionaire is competing with WMATA and Marc, in that Maryland has multiple places they could choose to spend our transportation trust fund dollars, and getting greedy might mean investment dollars go elsewhere.
I do think it's kind of damning that a justification for these kinds of agreements is that the contract requirements mandate state of good repair, so they are budgeted for and monitored for maintenance.
The sad thing is that typically government agencies stint on maintenance because elected officials feel like it can always be put off. e.g., WMATA.
To be clear, I am not against these kinds of contracts, I just think they should be accurately described.
And government agencies shouldn't have unrealistic expectations about what they mean either.
That the concessionaire isn't going to let cost overruns slide, that they have more and better lawyers, and they are prepared to walk if necessary to get their way.
A couple years ago I spent a day with a former Transport for London official and we were talking about Crossrail (which has killed TfL because of the national government's reneging on its share of funding, so they've cut back on everything else to pay for it).
He mentioned how an engineering improvement to the train cars was developed after the contract was let, but it was impossible to specify a change, because the contract was fixed. That TfL would have to go in and make the change after the train cars are delivered.
(Similarly, the street one block over was slated for repaving. But Pepco also had to dig it up for changes to the electricity delivery system. But DC and Pepco couldn't get on the same timeline, so the city repaved it. Then Pepco dug it up and repaved it. But if the city could have delayed, then Pepco would have done it.)
wrt the other stuff (my series about "complementary network improvements") I tried to get Purple Line Now and ACT interested, offered to do a presentation, but they were never interested.
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