Public–Private Partnerships for Financing Federal Capital

Abstract

This article examines whether public-private partnerships are useful for financing federal capital, defined as land improvements and buildings. The point of view is that of a federal agency. Because relatively few public-private partnerships have financed federal capital, this article analyzes the issue through a conceptual approach. It finds that pursuing a public-private partnership to finance federal capital may not necessarily be less costly than the routine federal budgeting approach, but it can allow an agency to meet its capital needs quicker and at no significant additional (equivalent) cost. Faster acquisition would likely lead to a net social benefit to the American people equal to the value of the agency’s additional public services produced with that capital. Consequently, the article concludes that public-private partnerships can be a useful approach for federal agencies to acquire federal capital.