The FC2 kicked off it Infrastructure Investment Initiative with the release of Infrastructure Trust white paper at its Spring 2013 Board Meeting. This white paper called attention to current trends – increased population, accumulated infrastructure deficit, leaner public resources (especially ever-increasing federal austerity), and a restricted capital borrowing position due to the city’s self-imposed debt cap – that inhibit the District to realize its full economic potential. The FC2 proposed to create a DC Infrastructure Trust and called for the passage of District Public-Private Partnership enabling legislation.
Panelists Lois Scott, CFO for the City of Chicago, Willy Walker, President, Chairman and CEO of Walker & Dunlop, and Tony Williams, along with Moderator Tom Davis, engaged in a lively discussion about strategies for facilitating private investments in public infrastructure projects, such as the Infrastructure Trust model pioneered by the City of Chicago (see related news for more information). Private investment can help the city meet its growing infrastructure needs while allowing it to remain within the city’s approaching debt cap.
Lois Scott emphasized the range of options that exist for infusing private sector innovation and cost-cutting approaches in traditional public projects. Private participation can also incentivize life-cycle asset management strategies that improve service quality. Chicago is using this model to invest in energy efficiency improvements to its municipal buildings. Willy Walker noted that infrastructure is “crumbling” nationally, because it is not prioritized. He added that there are emerging niche markets that make sense for private investment, such as school bus and ambulance maintenance. Tony Williams noted that infrastructure projects work best when the private sector shares in the risk and supports public needs, such as redeveloping Union Station and DC Water, but that developing contract management capacity within the public sector is critical to success. Tom Davis commented that the public sector is choosing to prioritize resources for operating costs, such as entitlement programs, rather than investing in infrastructure, which is creating a need that the private sector can help fill.
See the Washington Business Journal coverage here.