Toll road financial performance in the face of revenue risk - a comparative analysis of two cases
- Many Public-Private Partnership (P3) project have succeeded in bringing private capital to expedite US infrastructure development, but some of them have faced financial distress and have ultimately filed for Bankruptcy. This thesis describes exploratory research to uncover possible reasons behind struggling toll road P3 projects and their impact on taxpayers by looking into two projects that went through bankruptcy: Southern Connector, and the State Route 125. This thesis develops case studies for each project from sources including court documents, news articles and past studies. By comparing and contrasting the two cases, several conclusions are drawn. First, that P3s can be a tool to shield taxpayers from demand risk if appropriately structured; second, efficient transfer of risk is critical to project's success, especially in aligning incentives to ensure that traffic demand forecasts for toll roads are unbiased; lastly, the 63-20 model is less feasible for P3 projects with high risk profile such as toll roads. While the model transfers demand risk to the concessionaire through the use of project finance, it is less effective in aligning incentives to remove bias in traffic forecasts.
|Type of resource
|electronic resource; remote; computer; online resource
|1 online resource.
|Gu, Dao Ning
|Degree committee member
|Levitt, Raymond E
|Levitt, Raymond E
|Stanford University, Civil & Environmental Engineering Department.
|Statement of responsibility
|Dao Ning Gu.
|Submitted to the Department of Civil and Environmental Engineering.
|Thesis Engineering Stanford University 2018.
- © 2018 by Dao Ning Gu
- This work is licensed under a Creative Commons Attribution Non Commercial 3.0 Unported license (CC BY-NC).
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