HR Green ASD for Local Governments Handbook - Executive Summary - Manual (Page 11)

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CHAPTER 6: PUBLIC-PRIVATE PARTNERSHIPS
Gerald Gabris
Definition: Public private partnerships (P3s) in local government are the most complex and unique forms of
alternative service delivery. A 3P venture is a long-term, strategic contractual agreement between a local
government and a private sector entity, where the skills and assets of each sector are shared in delivering a
service or facility for the use of the general public, and where each party shares in the risks and rewards.
Why consider Public-Private Partnerships?
Entering into this type of P3 arrangement by a local government should not be taken lightly. A common
problem is that some local governments end up assuming almost all of the risk associated with the
partnership, and when they go south, end up absorbing all of the losses.
What we learned from a survey of recent research:
• P3s are unique in that the planning for and rewards of such contracts are normally long term, often
taking several years to unfold and mature.
• The local government needs to engender a realistic, flexible attitude toward a P3, and realize that it
will involve a long term commitment that will unlikely produce immediate, short term results.
What we learned from the focus group discussions:
• Developing a sense of readiness to engage in a P3 is associated with transformational leadership by a
local executive. Transformational leaders tend to be visionaries who believe it is possible to
accomplish complex goals if an organization generates to will to so. This type of strong commitment
to a larger vision is useful in convincing the broader local organization that a partnership is plausible.
• A unified governing board that generally shares in this vision is an important ingredient of readiness.
So is a stable, strong in-house expertise in economic development. There are so many possible paths
a P3 might take; the local government needs in-house expertise to separate the forest from the trees.
• Importantly, both the administrative staff and elected officials need skill and competence in
explaining how a public partnership advances a specific public good.
• Success depends heavily on the stability and low turnover of the staff and elected officials who
initially designed the P3 agreement. They possess ownership of the partnership and have a stake in
seeing that it is successful.
• The partnership needs to remain part of the long term vision of the community, and continue to be
grounded in a collaborative relationship between the partners that is flexible and evolving. The
flexibility is needed to address environmental changes and conditions that neither partner initially
anticipated, but nonetheless, is now crucial.
• The governing board needs to have developed sufficient skill in managing any within board conflicts
regarding the partnership, and understand the risks and rewards of the long term relationship.
• Successful P3's are based on positive results. Fundamentally, the public good utilized for justifying
the P3 initially must be sufficiently achieved to claim success. Success builds success.
Readiness checklist for P3:
 What style of leadership is exercised by the chief executive?
 Is the governing board unified in a shared vision with the chief executive that a P3 is an important
ingredient for community economic development?
 Is there a stable, strong in-house expertise in economic development?
 Has the governing board developed sufficient skill in managing any within board conflicts regarding
the partnership, and understand the long term risks and rewards of the relationship?