by Fredric W. Kessler, Partner, Nossaman LLP
P3 purists—especially the financiers in our industry—like to think that it’s not a P3 if there isn’t private equity and debt. They would have analysts believe that private equity and debt are the essential ingredients for achieving the life cycle price efficiency and risk transfers that are the hallmarks of P3 project delivery.
TxDOT departed from this orthodoxy with several design-build-maintain contracts, most of which structured a series of five-year optional maintenance periods into the contracts. The Arizona Department of Transportation has taken the TxDOT approach to a new level, setting precedent with its DBM contract for the South Mountain Freeway Project inked February 26 with a Fluor-led consortium, Connect 202 Partners.