Three Ways P3s Can Be Used in Kentucky Today

By Ed Green
P3 Kentucky Editor

For anyone who missed it this week, the Kentucky Transportation Cabinet outlined its plan to repair and rebuild roads and bridges throughout the Commonwealth over the next six years. The plan details investments totaling more than $8.5 billion for 1,400 projects throughout the state. It’s a great start but far short of the state’s needs.

Here’s a notable excerpt from KYTC’s news release:

This expanded list of projects, in addition to the state’s recommended priority list of unfunded projects, speaks to the need for additional state-generated revenue.

“We can’t count on Washington to provide more money to address these transportation challenges,” (Kentucky Transportation Secretary Greg) Thomas said. “As we move into the summer construction season, we have to closely monitor our cash balance due to a significant number of projects in the pipeline, as well as substantial debt payments the Cabinet owes beginning in June. Our top priorities will be limited to projects that improve safety, repair bridges and pavement and support job growth.”

Those who have followed infrastructure discussions closely in recent years know that the Commonwealth’s needs are not limited to transportation. In addition to 3,000 structurally deficient bridges – about one-third of which are addressed by the six-year plan – the state has $6 billion in needed waste-water improvements, $6.2 billion in needed drinking water improvements and significant needs for improved transit, according to a Kentucky Chamber of Commerce Infrastructure report.  Meanwhile, 16 percent of our citizens are without broadband access, a deficit that exacerbates the educational deficit we have in Kentucky as fewer young people have access to online learning tools and information.

Yesterday, several of our P3 Kentucky Roundtable members talked about how P3s can be used help curb the state’s infrastructure crisis. During the annual convention of the Kentucky Society of Professional Engineers in Owensboro, I was joined in a panel discussion by:

These P3 Roundtable members did a great job sharing information not only about the state’s P3 legislation but also the possibilities of P3s in Kentucky. A few collective takeaways were:

  1. Kentucky has numerous opportunities to find ways to regionalize services offered to citizens and find economies of scale that could lower the overall cost to taxpayers. To be successful, agencies, counties and local governments will have to work together with the private sector and each other to develop valuable solutions.
  2. Local water systems are an ideal place to start thinking about partnerships. With the billions of dollars in needed water improvements and a limited ability to raise rates or taxes to fund capital improvements, water systems need to consider new ways to provide services – perhaps by centralizing water treatment and distribution for multiple districts or counties.
  3. Finally, private-sector firms have tremendous opportunities to bring solutions to our infrastructure challenges. Using unsolicited proposals, private investors, developers and engineering/construction professionals can offer ideas to government leaders that they might not have considered themselves. This is a tool Kentucky has that many other states don’t, and we should take advantage of it.

P3 Kentucky was created to educate, inspire and connect leaders with resources, so if you have a question about where to go next, please reach out: (502) 544-2917 or ed@c2strategic.com.

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