Ann-Therese Schmid Discusses How P3s Can Help Address Financial Challenges of Cities
Ann-Therese Schmid was quoted extensively in the P3 Bulletin article “How P3s Can Help Cities in Financial Distress.” The piece explores whether — with municipal officials facing problems such as budget shortfalls, high interest rates and significant debt obligations — P3s can provide a route to lessen cities’ financial challenges.
One of the main points discussed is the value that P3s can add to distressed cities. Commenting on the topic, Ann-Therese said using P3s to develop infrastructure around emerging technologies is a prime example of this. She said, “This is happening [in] nascent markets like electric vehicle (EV) infrastructure…Many cities want EV infrastructure. And if they’re open to letting in the private sector it’s a pretty quick way to get to a revenue stream. Of course, it always depends on the financial plan and how things pencil out, but there are opportunities out there. And because it’s EVs, there might also be grants available for green projects to help offset costs.”
She also notes that as “P3s continue to evolve, we need to alter our perception of what a successful P3 can be. A lot of times when we think of P3s we think of megaprojects worth billions of dollars. There’s a shift to an extent that there’s a space for smaller P3s in the market. The commercial terms may be less complex and the capital costs less, but it is still a P3 contract.” She added, “Everything depends on the same elements – the assets, the revenue stream and the determination of risk. Foreign markets have P3s of all sizes. But here [in the U.S.] the perception is that a P3 isn’t worth doing unless it’s a billion dollars or more.”
Further on in the article, while discussing best practices for implementing a P3 project, Ann-Therese says outreach to educate stakeholders on the value of P3s is important. “Good community outreach and communication matter, a lot. The public has to learn what P3s are so that they’ll accept them. And municipal officials should be as transparent as possible with the benefits and costs.”
She closes by addressing what is perhaps the most critical aspect in bringing a P3 project to fruition: politics. “Politics can blow up a project in a minute,” Ann-Therese said. “And that can negate all of the work that many people have done to move things forward. Laying the political groundwork is key, and that should be an ongoing part of the education piece.”
