Susan Lent Talks Transportation Infrastructure and P3s with Metropolitan Corporate Counsel
Metropolitan Corporate Counsel interviewed Akin Gump litigation partner Susan Lent for “Transport Infrastructure – A Hot Ticket: Despite political uncertainty, interest in rail and road projects remains high” on demand for transportation infrastructure projects in the United States.
Among the topics discussed by Lent:
- Projects available for federal funding and their requirements: “A broad range of projects could be eligible for federal funds, assuming they are public works. At minimum, the project has to be a public-access road, transit system or airport – which, it turns out, covers a broad range of projects such as roads, bike paths, transit projects, airport improvements and some projects within port complexes. Once you accept federal funds, you must meet various federal requirements. For example, highway and transit projects have to be part of a region’s transportation plan, in which funds must be identified for projects. Beyond that, you have to complete an environmental review and follow certain procurement rules and labor laws for all transportation projects.”
- The benefits of public-private partnerships (P3s): “The biggest perceived benefit of P3s is shifting risk to the private sector and allowing the private sector to achieve cost savings through design and operational innovation, but, again, the private sector expects a reward. Within a P3 design-build structure, the public sector cedes some control – typically through use of performance specifications instead of detailed design specifications – for the sake of getting the project done.”
- The political risks for private investors: “[O]ngoing payments for these projects are subject to availability of future appropriations. Some P3 statutes provide more protection than others, but investors need to look carefully at these issues when assessing opportunities and risks. The analysis should include the risk of spending time and money lobbying for projects against the real possibility that success will be thwarted by the subsequent election of a new political leader.”
To read the full interview, please click here.