How the federal government can use P3s to strengthen the backbone of America

The US faces a vast infrastructure funding gap of $3.7trn between 2024 and 2033. Here are six ways to think anew and bridge that gap, writes Jon Phillips, our chief executive.

As engineers across the country know all too well, taxpayer dollars alone will never be sufficient to build a stronger America, fit for the 21st Century. 

So the time has come for the federal government to think anew. It needs to adopt a national strategy that encourages the use of P3s as a core delivery tool. 

Americans are crying out for smoother, less congested highways. They want affordable and resilient supplies of energy to power an AI-driven future. Both water supply and treatment need to be clean for all, and able to withstand the droughts and storms of climate change.  

This can be achieved. A new approach to financing and managing infrastructure - with the federal government partnering with private investors - can unlock huge reserves of ‘dry powder’ needed to fuel the future. While taxpayer dollars are sorely stretched, private investors are armed with hundreds of billions of dollars - raised from American pension funds, banks, insurers and many other sources around the world - that can be put to work.  

Public sector oversight of private capital and expertise - brought together under a P3 model - can speed up project delivery, drive operating efficiencies, encourage technical innovation, guarantee long-term maintenance, and reduce pressure on federal and municipal dollars.  

It is a partnership arrangement that is already at work in states across America, as the P3 Report Card produced by GIIA and P3 Bulletin clearly reveals. Highways, airports, social housing, all delivered sooner, without yet more public borrowing. 

So what can the federal government do to unlock this better future, and drive policy changes that enable more states and cities to adopt the P3 approach?  

GIIA - which is the global voice of infrastructure investors - has developed six recommendations for knocking down barriers and encouraging fresh thinking. They are drawn from our broader ‘Building a New Foundation for US Infrastructure’ White Paper. By adopting these ideas, Congress and the administration can increase the role of P3s in building a stronger America. 

1) Expand Federal Incentives for State and Local P3 Adoption 

Congress and federal agencies should expand and align existing programs that support P3 use, including technical assistance, transaction development, and institutional capacity building.  

The Build America Bureau should be strengthened to help states establish P3-enabling legislation, create dedicated P3 offices, and access standardized procurement tools and model agreements. 

2)  Build a Federal Pipeline of P3 Projects 

The federal government should pursue a visible, coordinated pipeline of P3 projects to demonstrate effective risk allocation and long-term asset management.  

Congress should authorize long-term concessions and partnerships for eligible federal assets, modeled on proven initiatives such as military housing, and support cross-agency coordination of P3 strategy and project development. 

3)  Establish a Federal Asset Recycling Framework 

Congress should create an asset recycling program allowing proceeds from long-term concessions of existing public assets to be reinvested in new infrastructure.  

Participation should be conditioned on a single, standardized value-for-money assessment and continued public interest, through mechanisms such as revenue sharing or retained equity. 

4) Standardize Infrastructure Performance Reporting 

Federal agencies should require consistent performance reporting for federally supported infrastructure projects. Standardized metrics will improve transparency, reduce administrative burdens, and support better investment and delivery decisions across both P3 and traditionally procured projects.  

For example, federal leadership could focus on establishing a standardized value-for-money analysis to assess whether a P3 makes sense for a specified project. 

5)  Modernize Tax and Financing Tools to Support P3s 

Congress should modernize tax and financing policies by expanding access to Private Activity Bonds (PABs), and by introducing infrastructure-focused tax credit bond programs.  

These reforms would lower financing costs, broaden the investor base, and remove artificial constraints on P3 project delivery. 

6) Revise Federal Budget Scoring Standards to Treat Infrastructure Operating Concessions as a Distinct Concept 

The Office of Management and Budget (OMB) should update federal budget scoring rules to treat infrastructure operating concessions as a distinct contractual construct rather than as operating or capital leases.  

By limiting upfront scoring to only the risk retained by the government, agencies can access private delivery models without triggering unnecessary budgetary constraints. 

In addition to our White Paper, GIIA has produced further detailed policy papers, including one on ‘Budgetary Reforms to Unlock Infrastructure Partnerships’. In this, we call on the OMB, the Congressional Budget Office (CBO), and relevant federal agencies to modernize federal budget scoring rules that currently discourage the use of P3s. 

In our P3 Report Card, around half of all US states are graded C or D, due to their limited or untapped adoption of the P3 model. Yet the leaders, graded A, already demonstrate what can be done.  

By further unlocking P3s, allowing public infrastructure owners to partner with private finance and management experts, lawmakers can usher in a new “Golden Age of American infrastructure”. 

This article also appears in P3 Bulletin, in partnership with which we jointly produced the P3 Report Card.