The Dangerous Trend Taking Over Transit Construction

Public Private Partnerships are quite a trend in transit and infrastructure projects, but with the late and problem prone projects stacking up - are they all they're cracked up to be, or do they put the brakes on transit? Find out in our latest video.

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[rogersexton]

Thanks Reece. Brilliant video. As someone who was a trained lawyer I particularly note two things you said. At about eleven minutes you say, 'Writing solid contracts and winning legal battles seems to be a lot of the game with P-Threes' A little later you say '[We should be] learning best practices in innovation and creating new station designs [rather] than employing a ton of lawyers.'

[otterylexa]

To me, PPPs means private takes the profits, public takes the risk. Politicians always sell it as saving money but it's borrowing money at a bad rate without having borrowed money on the books. If the project was genuinely going to make money, the private sector would build it without the government underwriting the risk.

[fernbedek]

The 'good old days' were when various private sector companies tried to undercut each other building redundant infrastructure, oversaturated the market, went bankrupt, and then got nationalized. XD

[charliebramley]

London's HS1 was private partnership, and now it's really expensive for trains to run on the track

[mygetawayart]

I read the Italian case from the Transit Costs Project. Milan's M4 and M5 are a great example of a PPP-DBFOM done right, with in house expertise, standardized, practical station designs, good public sector oversight, strong political dedication and a local company that's entirely dedicated to the designing, building, operating and maintaining of the lines of the entire system. Costs are low and the lines are built quickly.

Rome's Metro C is instead a good example of the opposite. The project is funded in a Design-Build scheme, based on a preliminary project that failed to assess the risk of delays due to archeological finds that forced radical changes in some stations and massive station infrastructure to accomodate them in others. The procurement process wanted to shift the risk onto the private sector, eventually backfiring onto the public when the risks became realities (and the General Contractor can't do anything about it), the future of the complete line was questioned and the political will behind the project (aswell as the public's confidence in it) came and went. Not to mention, the uncertain future of the line is also due to the fact that it's being built in sections instead of all at once, making it more appealing in the short term but FAR MORE EXPENSIVE in the long term.

Between 2007 and now Milan was able to begin construction and open two brand new metro lines, for a fraction of the cost that it took Rome to build half of a single line (utilizing existing infrastructure for part of it) at an exorbitant cost.

[JohnUnit]

my mother was in both the political and public service part of government, both federally and provincially for about 3 decades, often being in the room for high level policy and implementation.

She's always said she NEVER saw a p3 save money, but did see lots of hints of corruption between the political people and the companies that just happened to get the deals.

See also: "consulting"

[DatMeleeMan]

the sydney airport link actually only has fare for the two stations attached directly to the airport and not green square and mascot. a lot of people actually just get off at mascot and take a bus into the airport to avoid the fee (which i agree is terrible but the agreement with the company will expire in the distant future at least)

[jerrytwolanes]

Sorry I got here late. I was watching the european tram driver championship!!!

[NickBurman]

It's worth pointing out that many 19th century "private" transit schemes were in fact P3s. It's just that nobody at the time referred to them as such. For instance, the first sections of the Paris Metro were built under a contract between the city and the "Compagnie du Chemin de Fer Metropolitain de Paris" (CMP), controlled by French banker Édouard Empain; the agreement was that the city would build and finish the stations and tunnels, while the CMP would lay track, electrical systems, purchase trains and run the service for a set number of years under a concession. The same for New York City, where the city built the subways in Manhattan and parts of Queens and Brooklyn, then leased them to IRT and BMT for operation. It was only with the IND that the city became both owner and operator.

Some Japanese commuter/transit lines, especially those which wander into a different province/city from where it originated, are P3s. Off my head I can think of the Saitama Rapid Railway, jointly funded by municipalities, Saitama Prefecture and Tokyo Metro (which despite being a limited liability company is half owned by the central government and by Tokyo Metropolis).

[TheReactorLore]

P3s are one of prime reasons why Eglinton Crosstown is delayed, and they are very micromanaged. However, this depends on the contractors and the politicians. The Canada Line is an example of a well-designed public-private partnership that doesn't funnel money into the transit agency's executives or run into corporate greed problems. In conclusion, the Private Sector optimization of the Canada Line is objectively better than the corporate greed of the sydney airTrain faires and the construction micromanagements of the Eglinton Crosstown.

[Diego-pcrc]

In sao paulo the new privately operated subway lines have free transfers onto thr network, but the pay is structured in such a way that if you do trasfer the city ends up paying more to the company then they receive from the fare

[TheReactorLore]

12:12 'Stroad' is a much more fitting name for such wide and car dependent arteries than 'suburban street.'

[Lucaat]

I am not against private business or a product or service that is valuable plus turns a profit BUT

I dont think this model is good for:

1. Public Infrastructure
2. Public Transportation
3. Healthcare
4. Housing (or neighborhood planning). (Free market for profit real estate can be great in the right places, but not everywhere, a mix of cooperatives, social keeps rents and prices down).

In these instances, livability and well being does not go hand in hand with the most $$$ and it shouldnt either.

[dznrboy]

Eglinton Cross Town is a prime example of why P3 does not work, 13 years to build a line with no ending in sight, and budget overruns and lawsuits are ridiculous. Metrolinx has made it so that the TTC has no involvement in any decisions or any input whatsoever.

[whophd]

“DBFOM” has had different names over the years across the countries. In Australia in the 2000s it was “BOOT”, Build Own Operate Transfer.

[HandiTransport]

A lot of UK PFI schemes were conceived just to have the debt not on the government accounts to comply with EU rules. The whole thing was badly thought out and the contracts badly written with all the risk applying to the government and the profit went elsewhere.

I'm not totally against using partnerships but the government is usually easy to bamboozle and the final contract doesn't give value for money. That said building anything in the UK usually goes well over budget and is delivered late, sometimes decades late.

[euanduthie]

The UK's P3s should be enough to scare anyone else away from the model. They've ended up delivering badly built projects, at an eye-watering cost, often with contracts locking the country into paying for them for 30 years. On top of that, the push to privatise everything has led to a hollowing-out of the state's capacity to take on this sort of project, and treating everything as a new contract means that you don't build up the expertise that controls costs in the long term.

[LS-Moto]

@RMTransit as the video got uploaded, I just saw that there is a livestream of a european tramdriver championship in Frankfurt going on. Yes, this exists. How cool is that. I think RMTransit should look into that.

[gordonohallmhurain]

Thank you for making this video. We need to have infrastructure built to last and built for use, not for profit. Frankly the private sector has no business profiting off of public goods and infrastructure, imo

[rislingpodiumperformance]

Just ask us in Ottawa how terribly the P3 has gone or that Eglington line. Its been a clusterfuck of delays and cost over runs and complete crap