Article Date: 07/25/2014

Steps Taken at the Federal Level to Grow Public-Private Partnerships in Construction

By Steve Rizer


A pair of recent developments taking place at the federal level could change the collective contribution that public-private partnerships (P3s) make to the U.S. construction industry for many years to come. One of those developments is the introduction of President Obama’s Build America Investment Initiative, which is designed to expand the market for P3s. In addition, a coalition of several high-profile construction groups has drafted and presented for congressional consideration a proposal whose partial goal is to grow federal P3s while ensuring that small businesses can work on such projects “without fear of non-payment.”


Obama’s new P3 initiative features a Build America Transportation Investment Center, which will serve as a one-stop shop for cities and states seeking to use “innovative” financing and partnerships with the private sector to support transportation infrastructure. The center will be housed at the U.S. Department of Transportation (DOT). Components of the center include a ‘navigator service’ for the public and private sectors, improved access to DOT credit programs, technical assistance, and information to reduce uncertainty and delays.


On another front, a coalition of 13 groups -- including Associated General Contractors of America, American Institute of Architects, American Subcontractors Association, and Construction Management Association of America -- has drafted a “Construction Consensus Procurement Improvement” bill for potential introduction in Congress. A stated goal of the Construction Industry Procurement Coalition’s proposal is to help grow federal P3 opportunities for small businesses by providing payment certainty.


“For almost eight decades, the Miller Act (40 Code of Federal Regulations, Sections 3131-3134) has provided payment protection for subcontractors and suppliers on federal construction projects,” the coalition said. “While P3s become increasingly common to finance and construct public needs, the protections of the Miller Act must be uniformly available to subcontractors and suppliers, most of which are small businesses, working on such public-private projects. As such, this [proposal] would help ensure that small businesses could work on federal P3 projects without fear of non-payment.”


The ConstructionPro Network member version of this article includes additional details about Obama's new initiative and the coalition's proposal.



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