Using Private Funds for Public Roads

Devin McIntyre's picture



One of the most important aspects of transportaion in Michigan is the reliance on I-75. With major contruction underway currently on the interstate, the State of Michigan is turning to private funds to help fund the upfront costs of the project. 

"This financing model allows the developer to raise money for project completion through private partnerships. While all project funds will be private, MDOT will use public funds to reimburse the developers after project completion over a 20 to 30 year period."

Although the partnerships will eventually be reimbursed from the state, there are some investment benefits for private investors. 

"public owner benefits from guaranteed performance standards and long-term pricing that is locked in throughout the agreement," 

There is little information out there with regards to what the 'long-term pricing' entails. How will the State determine a fair pay out? Who is funding the interest that the investors are expecting? 

Here is a link to the full article. 

What are your thoughts on Michiagan using private funds for public projects?