Public-Private Partnerships for Transportation Categorization and Analysis of State Statutes | January 2016


2016 P3 Statute Categorization and Analysis

Interactive P3 Statute Maps

As part of its ongoing work to help state legislatures analyze the options available relative to transportation funding, NCSL has concisely categorized and compiled the provisions of state law addressing public-private partnerships (P3s) for transportation.

In 2010, a working group of state legislators and industry experts convened by NCSL published comprehensive guidance on P3s for transportation, Public-Private Partnerships for Transportation: A Toolkit for Legislatures. This toolkit helps those states that wish to embark on P3s or amend existing law with several principles to consider when drafting legislation.

This 2016 document builds on the toolkit, by categorizing and analyzing all transportation public-private partnership laws adopted by the 33 states, the District of Columbia and Puerto Rico that have enacted such legislation.

PDF | Download the 70-page report | Public-Private Partnerships for Transportation Categorization and Analysis of State Statutes


Transportation infrastructure funding and finance are top priorities for state and local governments. Due to a variety of circumstances, states have found themselves carrying a larger transportation funding burden than ever before. Years of uncertainty about federal action, stagnant gas tax revenues, rising maintenance and repair costs and aging infrastructure have contributed to the current dilemma that many states are facing. 

freewayIncreasingly, states have turned to innovative approaches to help solve their transportation funding shortfalls. One such innovative technique is the use of public-private partnerships (P3s). The Office of Innovative Program Delivery (OIPD), a division of the Federal Highway Administration (FHWA), defines public-private partnerships as “contractual agreements formed between a public agency and a private sector entity that allow for greater private sector participation in the delivery and financing of transportation projects.”[1]

It is important to note that P3s do not act as a funding source; rather, they can provide additional financing opportunities and create efficiencies leading to cost savings. Nor are P3s a cure-all for transportation funding needs. 

As with NCSL’s Public-Private Partnerships for Transportation: A Toolkit for Legislatures (NCSL’s P3 Toolkit) this report is a straightforward and factual examination of P3s and the legislation states have passed. The report serves as a comprehensive categorization and analysis of the transportation P3 enabling statutes from across the country. 

State Public-Private Partnership Legislation: Why Is It Needed?

As states assume increasing responsibility for transportation funding and finance, all possible solutions are being assessed. Due to the inherent complexity of P3 agreements and the typically large, multi-jurisdictional scale of the transportation projects involved, the legislature’s role is vital. Enabling statutes dictate the ability of existing or newly created state agencies to engage with private industry through P3s. The states examined in this report have written statutes to meet their specific needs and take into account the unique conditions of its economy, infrastructure and public policy context.

State P3 legislation creates the framework within which public agencies can accomplish the role of government while leveraging the expertise and resources of private industry. Sound public policy will help protect the public interests, establish the conditions within which agreements can be made and allow for both public and private goals to be satisfied.

US map showing trends in Public-Private Partnerships

State P3 Enabling Statutes

The first “modern” public-private partnership enabling legislation for transportation projects was passed by California in 1989, and Florida and Missouri followed the next year. Since 2010, three states (Connecticut, Ohio and Pennsylvania) and the District of Columbia have passed P3 enabling legislation, and Maryland passed comprehensive legislation that moved P3 authorization from regulation and case law to statute. As of January 2016, 33 states, the District of Columbia and Puerto Rico have enacted legislation enabling P3s for transportation projects.

P3 legislation can vary from state to state. While many aspects of sound policy are important for every jurisdiction, lawmakers tailor their legislation to fit the specific needs and desires of their state. Table 1 on Page 14 presents general facts about each state’s P3 legislation. It tells when P3s were first enabled in a state and what type of law was passed. Also provided is which governmental entity or entities are permitted to engage in P3 agreements and for what type of projects.

Recent Proposed P3 Legislation 

States now, more than ever, are facing the need to develop new and innovative solutions for infrastructure funding. With the tepid increases in federal transportation funds, the states continue to assume an ever-increasing share of transportation funding. P3s are being considered as one alternative by state policymakers and transportation leaders to lessen this burden.

NCSL’s Transportation Funding and Finance Legislation Database[2] which tracks legislation from all 50 states, provides data on the number of P3-related bills considered since 2009:

  • 2015: 47 bills in 25 states and the District of Columbia
  • 2014: 68 bills in 21 states and the District of Columbia
  • 2013: 81 bills in 28 states
  • 2012: 30 bills in 16 states
  • 2011: 40 bills in 20 states
  • 2010: 22 bills in 9 states and the District of Columbia
  • 2009: 37 bills in 20 states and Puerto Rico

Based upon these numbers, it is apparent that P3s are a hot topic in statehouses across the nation. The number of bills considered has increased during the last six years. Dramatic increases in 2013 and 2014 more than doubled the number of bills considered in the two prior years.[3]

P3 Models, Benefits and Concerns

P3 Project Delivery Models

P3 delivery methods commonly fall into the following categories: design-build (DB), operate-maintain (OM), design-build-operate-maintain (DBOM), design-build-finance (DBF) and design-build-finance-operate-maintain (DBFOM). Each method can offer advantages or disadvantages, depending on the specific project and parties involved. Every transportation project is different, and may or may not benefit from innovative delivery methods such as P3s.

A number of distinctions can be drawn between DB contracts and P3s. DB is a project delivery method that can be used as part of a P3. While DB is an innovative method of procurement and a useful tool as part of P3s, a DB contract is not always, in itself, a true P3 due to the lower level of private involvement, less risk-sharing between the public and private sectors, and the lack of private financing involved. This is not to say a DB model cannot include all the aspects of a P3, but many times including an enhanced private role through financing, operations or maintenance can achieve higher value for the money.

DB contracts may be permitted for transportation projects in states, while P3s are not. In states that permit both DB contacts and P3s, it is not uncommon for DB contracts to be authorized under separate articles or chapters. This report examines only P3 enabling statutes, some of which authorize DB and others that do not. Table 2 on Page 23 illustrates which states include DB in their P3 laws. For further information on DB statutes, see NCSL’s P3 Toolkit.

Project Delivery Models

  • The P3 project delivery models listed above span a range of private sector involvement. Traditional procurement methods typically tackle each phase of a project individually and commonly keep operations and maintenance under the state DOT’s purview.
  • P3s allow for the partners to choose, based on desired risk transfer and public sector goals, how much of the project’s lifecycle will be included in the partnership.
  • Each additional phase included in the P3 brings with it potential cost savings, efficiencies and transfer of risk.

P3 Related Benefits and Concerns

  • Key benefits of the P3 project delivery method arise from leveraging the private sector’s expertise and resources. Private sector partners can bring to the table tools and skills to achieve efficiencies, provide financing and enhance quality. As highlighted in NCSL’s P3 Toolkit, P3 benefits include private financing and project acceleration, monetization of existing assets, cost and time savings, lifecycle efficiencies, improved project quality and risk transfer.
  • Any new and innovative technique naturally will create concerns and potential controversies. Difficult questions have arisen around P3s in general, and each individual project often will include its own unique considerations and controversies. NCSL’s P3 Toolkit highlights some of these potential concerns, including loss of public control and flexibility, private profits at the public’s expense, loss of future public revenues, risk of bankruptcy or default, accountability and transparency, environmental issues, labor concerns, use of foreign companies, toll road controversies and specific contract terms.
  • These benefits and concerns need to be addressed at the outset of any P3 agreement. Sound public policy is the primary and most authoritative tool state legislatures have to alleviate any issue. As this report’s categorization and analysis of P3 statutes shows, many state legislatures have included provisions to address potential concerns about P3s and enhance the benefits such models can provide. Depending on the goal of the legislature and all parties involved, these benefits and concerns are handled differently. NCSL compiled this report to provide a high-level examination of all existing approaches states have taken to enable P3s for transportation projects through statute.


[1] The Office of Innovative Project Delivery, P3 Defined (Washington, D.C.: Federal Highway Administration, n.d.),

[2] National Conference of State Legislatures, Transportation Funding and Finance Legislation Database (Denver: NCSL, n.d.),

[3] It should be noted that four states (Montana, Nevada, North Dakota and Texas) hold legislative sessions in odd years only, and a number of states have two-year carry over sessions, which explains the cyclical nature of the number of bills considered.