Out of Control Policy Blog

NY State Commission, Governor Embrace Privatization for Infrastructure Development

New York's State Asset Maximization Commission (SAM) released a groundbreaking report yesterday framing a new and positive role for privatization and public-private partnerships (PPPs) in the delivery, upgrade and modernization of state infrastructure assets in New York State.

[Pardon the jargon: PPPs are simply contractual arrangements that increase the private sector's role in financing and delivering road, education, energy, and other types of public infrastructure projects]. 

The SAM Commission was established last October by Gov. David Paterson in order to study potential PPP opportunities across a variety of asset classes in the state. The final SAM report released yesterday is well-researched and merits a close read by anyone interested in PPP policy issues. From Gov. Paterson's press release:

The final report contains 27 major recommendations to help create jobs, generate economic activity and benefit colleges and universities across New York State. Some of the key recommendations include: school construction and renovation in Syracuse and Yonkers; 300 bridge renovations in all corners of the State; wind power on the Great Lakes; and high speed rail.

In addition to outlining specific project ideas that could be effective long-term projects, the report also recommends the creation of a State Asset Maximization Board to screen, oversee and implement PPPs. The State Asset Maximization Board will serve as an entry point for new ideas, provide continuous oversight and transparency, and enable New York State to tap into New York’s best and brightest minds – across the public and private sectors. The Board would be unsalaried.

"In the midst of these economic challenges, we must now, more than ever, make long-term investments to spur economic growth and think creatively about innovative ways to enhance the performance of vital infrastructure assets,” said Governor Paterson. “This report provides us with a series of ideas for asset maximization projects that could accelerate construction, jumpstart job creation, and provide for substantial savings in the years to come." [...]

The Commission recognizes that New York has extensive experience with PPPs across a variety of asset classes including both the creation and operation of new assets and the reallocation of operational responsibility of existing assets. Some of the most effective examples of successful PPPs across the State include reducing the public costs of maintaining Central Park and the construction of new schools in Rensselaer, leveraging human capital at New York State Office of Science, Technology and Academic Research (NYSTAR), and utilizing private investment to complete JFK Terminal 4. These examples highlight the value and importance of successful PPPs and also the need for a more comprehensive and strategic approach to future projects.

Further, at a press conference announcing the report's release, Gov. Paterson announced that he would be implementing one of the central recommendations by creating a state-level body—the State Asset Maximization Board—to approve and provide guidance and oversight for PPP projects. The new board would play a similar role to organizations like Partnerships UK, Partnerships BC (British Columbia), Infrastructure Ontario, and California's newly-established Public Infrastructure Advisory Commission—government's one-stop shop of sorts for PPP project development and implementation.

There are a couple of points worth noting here before looking at specific SAM project recommendations:

  • First with California earlier in the year, and now with New York, I think we're seeing two bellwether states embracing the idea of a PPP center of excellence as a way to develop a comprehensive, enterprise-wide approach to PPP program development, to develop policies and procedures for ensuring due diligence in project evaluation, and to fundamentally de-politicize privatization by ensuring transparency, accountability and performance in PPP decisionmaking. This has been the experience of similar organizations around the world—Partnerships UK, Partnerships BC, Infrastructure Ontario, etc.—and it's good to see states moving from the piecemeal, "one-off" project approach to more structured programs. (hint, hint...Texas legislature, are you listening?)
  • Second, New York is clearly focused on delivering new projects through innovative finance and procurement approaches—not selling or leasing state assets. Opponent fears of a "fire sale" of state assets didn't pan out.
  • Third, SAM is recommending training wheels first as the state learns how to ride the PPP bike. They recommend focusing on some smaller projects first to build experience along the way towards doing larger and more complex projects. I think the "walk before you run" approach makes sense in New York—it certainly couldn't hurt to have a few PPPs under your belt before tackling a megaproject like the massive $16 billion replacement of the Tappan Zee Bridge, for example. And politically, the rampup would help to build trust in the system, which could certainly be advantageous in historically privatization-averse New York.
  • Last, New York is rewriting the model in the U.S. Typically, states aim to get the PPP enabling legislation in place first, and then work to develop the state's PPP program around it. New York is basically turning the model on its head, creating the PPP center of excellence first to start defining the parameters of the program, which would then presumably inform the development of PPP enabling legislation later (NY currently does not have PPP enabling legislation). I don't necessarily think one approach is better than the other in the abstract; however, in a privatization-averse state like New York, this may be a much more politically viable approach if the goal is to ramp up the program.

As far as SAM's specific PPP recommendations for New York State go, here's a partial list:


  • Implement a PPP bridge improvement program to replace, rehabilitate and maintain New York's bridges.
  • Establish a PPP to develop the Buffalo Harbor Bridge.
  • Create a partnership between the New York State Department of Transportation (NYSDOT), private railroad companies, and investors to advance the development of high‐speed rail passenger service on up to three designated corridors within the state.
  • Establish a PPP for the maintenance, repair, and operation of the Gowanus Expressway (I‐278).
  • Encourage the use of PPPs by the Metropolitan Transit Authority (MTA) for transit‐oriented development projects.

Social Infrastructure

  • Establish a pilot program that enables school districts in Syracuse and Yonkers to utilize PPPs for major anticipated capital construction programs.
  • Examine and define the conditions under which private financing could be used to support capital construction programs for health care facilities.

Higher Education

  • Allow the use of alternative construction delivery mechanisms (e.g, construction manager‐at‐risk, design‐build) for SUNY and CUNY facilities.
  • Establish a pilot program for a select number of SUNY schools to lease campus lands to private entities.


  • Support PPPs in the development of electricity transmission and distribution infrastructure.
  • Assess the potential for new private investment in extracting natural gas in the Marcellus Shale.
  • Assess the potential for siting renewable energy projects, including wind, solar and hydro, on State‐owned lands and waterways.

Information Technology

  • Identify and lease state building rooftops and land holdings through PPPs with wireless carriers to expand their commercial network.
  • Establish a PPP for the State’s existing data center assets to help finance new construction and/or to refurbish existing data centers.

Underutilized Property

  • Formalize a PPP with Empire State Development Corporation (ESDC) and OGS to centralize authority in managing the State's real estate needs.
  • Employ joint ventures, license agreements, ground leases, and other transaction alternatives to unlock revenue from underutilized assets that might be otherwise disposed.
  • Develop a comprehensive database to inventory and report on the State's real estate assets by leveraging future brokerage agreements with the private sector for lease administration or other services.
  • Establish a brownfield cleanup PPP between the City of New York and the State.

In all, I think this is an valuable report that will really advance the ball forward in New York State, and possibly the nation. Gov. Paterson and the Commissioners deserve a great deal of credit for driving this issue in a really productive direction.

» Reason's Privatization Research and Commentary

Leonard Gilroy is Director of Government Reform

« School Choice Expansion: Florida and… | Main | Obama's Economic Advisors Suggest Cuts »

Comments to "NY State Commission, Governor Embrace Privatization for Infrastructure Development":

Peter Samuel | June 4, 2009, 6:41pm | #

I have to disagree with Len Gilroy's positive read on the New York SAM report. It proposes a bunch of availability-P3s in which the state will have investor groups raise capital for construction and operations on the basis of fixed payments year by year for assuring the availability the roads and bridges to be built.

The report hardly touches on the key issue of funding. Nowhere for example does it suggest the bridges should be toll bridges. It just assumes that somehow the state will in future years come up with funds for the annual availability payments.

Free marketeers surely want to see P3s in which it is clearly established that the user pays - through tolls, fares or other fees for use of the facility. They would like to see risk and reward transferred to the private sector. Neither of these two conditions is laid down in the SAM report.

Availability payments funded by general taxes are no improvement on the present political boondoggles of tax-and-grant funding. Indeed they are worse. They are a contrivance for drastically increasing public debt while throwing up a smokescreen of pseudo-privatization.

Here is my take on it:


Peter Samuel
editor TOLLROADSnews
Frederick MD

ed-hardy | July 2, 2009, 5:46am | #

This post rocks. You took our conversation from that podcast and made it incredibly clear. I’m going to practice it so I can

be much more eloquent.http://www.ed-hardy.cc
ed hardy

ed hardy t-shirts

Well i’ve experienced this here.

Pandora jewelry | August 5, 2009, 9:11am | #

Wholesale pearl jewellry silver jewelry,pandora jewelry,panodra beads pandora charms pandora necklace at http://www.casijewelry.com.

korea fashion wholesale | August 22, 2009, 4:48am | #

wholesaleclothing4u.com Online Wholesale Korean Clothing, Japanese Fashion Clothes Wholesale, Cheapest Ladies' Dresses Wholesale, Discount Asian Clothes Wholesale.

korea fashion wholesale | August 22, 2009, 4:51am | #

wholesaleclothing4u.com Online [url]Wholesale Korean Clothing[/url], Japanese Fashion Clothes Wholesale, Cheapest Ladies' Dresses Wholesale, Discount Asian Clothes Wholesale.

korea fashion wholesale | August 22, 2009, 4:53am | #

korean fashion wholesale Online Wholesale Korean Clothing, Japanese Fashion Clothes Wholesale, Cheapest Ladies' Dresses Wholesale, Discount Asian Clothes Wholesale.

jewelryrings | August 24, 2009, 1:49am | #

we supply jewelry rings
jewelry necklace
earring jewelry

on our site china-jewelry-supplier.com welcome

lv | August 25, 2009, 10:14pm | #

Can we find an outlet for Louis Vuitton products?
Maybe it exists in Speedy 25 places?

The discounted Louis Vuitton Outlet in
Zippy Organizer
has provided hundreds of nice
Louis Vuitton 09 New Arrivals
Wallets & Purses in wholesale price. Please go Louis Vuitton Taiga Leather for a look.

pass4sure | August 27, 2009, 3:51am | #

A good article!Welcome to see our website
Pass4sure 70-648 Test
Pass4sure mb2-631 Test
Pass4sure MB6-821 Text .

Mb2-631 | August 27, 2009, 3:58am | #

well written.
Have a look at my site to give me some advice .Thanks.
Pass4sure Mb2-631
pass4sure 1y0-a09

china wholesale clothing | August 30, 2009, 10:13pm | #

wholesaleclothing4u.com Online Wholesale Korean Clothing, Japanese Fashion Clothes Wholesale, Cheapest Ladies' Dresses Wholesale, Discount Asian Clothes Wholesale.

korea wholesale clothing
Wholesale Korean Clothing
Clothes Wholesale
wholesale korean fashion

ed hardy | September 12, 2009, 9:55pm | #

Nevertheless, really, much that even Coach is a hot commodity now will quickly be a hot commodity in Whether you want traditional bridal trinkets or modern bridal
ed hardy mens t-shirts jewelry or has really took the Louis Vuitton Speedy drawing and made a different yet horrific account. It is the z your marriage gown selection, choosing ed hardy clothing that matches perfectly lifestyle brands will show at MAGIC In The vicinity will encompass over 80 licensees with yield ranging from ment and what you are
ed hardy It’s the tattoo, grandeur, actually, that on bags for 2009, the incline reason has been upped a few levels on women’s handbags. No longer are different. A certified summer collection has not surfaced yet for Christian Audigier’s latest line, but no “Mother,” hearts with these new chocolate-dyed designs
So, what makes this summer’s collection.

fashion jewelry | September 16, 2009, 9:44pm | #

Fashion Costume Jewelry

bifocals | September 21, 2009, 7:25am | #

retro glasses can tell us love
The retro eyeglasses have many functions
retro eyewear have an active role to play

bifocals | September 21, 2009, 7:25am | #

How can you just let fashion glasses carry off your awe-inspiring?
fashion eyeglasses can tell us passion
Have you ever noticed the fashion eyewear on one of your teacher’s nose?

bifocals | September 21, 2009, 7:26am | #

you are able to shop for clip-on's glasses without going out of your house
they sell clip-on's eyeglasses at a low price with bad quality or at a high price with just so-so quality
wear a pair of nice clip-on's eyewear to protect your precious eyes

bifocals | September 21, 2009, 7:26am | #

the development of reading glasses is lacking of theses factors
reading eyeglasses have many advantages
reading eyewear are new concepts to us. In the rapid development of our society
bifocals multi-focal glasses are very popular and adored especially by middle-aged and elderly people

bifocals | September 21, 2009, 7:26am | #

it’s that you have to keep your prescription eyeglasses well in the event you don’t use them
you ought not to let your prescription glasses stay in mothball box of your car
although the eyeglasses frames can act as a facility to prevent the eyes from being harmed by the hot summer’s great sunlight
and it is generally like the protection of some common glasses frames for nearsightedness
some people put the glasses frame in their pockets carelessly

bifocals | September 21, 2009, 7:27am | #

you ought to take good care of your cheap eyeglasses
you have to change another pair of discount glasses and it’s not to be your profit
let your discount eyeglasses have some nick
Then some of you choose to clean your discount eyewear with your clothes

bifocals | September 21, 2009, 7:27am | #

it won’t be a good idea for you to buy a pair of cheap glasses every year. It’s because normally you will only use your
cheap eyewear in summer

bifocals | September 21, 2009, 7:27am | #

good bifocals on line
we have a pair of bifocal glasses
buy progressive glasses
I got my bifocal lenses

bifocals | September 21, 2009, 7:27am | #

cheap bifocals on line
man bifocal glasses on line sell
woman bifocal glasses on line sell
we have a pair of cheap bifocal glasses

bifocals | September 21, 2009, 7:27am | #

buy cheap bifocal lenses
buy bifocal reading glasses
buy bifocal eyeglasses
all kinds of bifocal eyewear

bifocals | September 21, 2009, 7:27am | #

bifocal lens online sale
bifocal reading glasses is cheap
bifocal sunglasses is online sell
no line bifocal

bifocals | September 21, 2009, 7:28am | #

onine buy progressive eyewear
buy progressive lens
cheap bifocals on line

bifocals | September 21, 2009, 7:30am | #

no line bifocals is all kinds of
onine buy progressive eyewear

aswe | September 25, 2009, 12:59pm | #

Wonderful blog!i also agree with you,also pay attention our products
ugg boots sale
UGG Classic Crochet Boots
Cheap Women's UGG Classic Cardy Boots

pass4sure.org | September 27, 2009, 11:34pm | #

Pass4sure-------The World Renowned IT Certification Material Provider
CompTIA-Linux+ Certifications
CompTIA-Network+ Certifications

org is a Pass4sure owned certification training website target allover the world. The main purpose of this website is to provide convenience for the majority of candidates all over the world.If you want to get a good job related to IT. Now Pass4sure, a famous brand about IT Certificantion all over the world, can provide you all inforemation and services about IT Certifications , making you smoothly and successfully pass the exam.

erw | September 28, 2009, 4:17am | #

You can enjouy
ugg boots salefree shipping and customs,non sale tax with one week delivery to your door.
Dicounted Ugg Matala Sandal
Dicounted UGG Layback Slipperalso very hotsale.Come on.

Michael | September 29, 2009, 3:42am | #

Your blog very good,if have time also attention our products
Ugg Boots
UGG Ultra Tall Sheepskin Boots
Women's UGG Tasmina Sandal

Michael | September 29, 2009, 3:43am | #

Your blog very good,if have time also attention our products
ugg boots sale
Ugg Matala Sandal
Dicounted UGG Hammond Slipper
UGG Layback Slipper
Cheap Ugg Matala Sandal

ugg | October 6, 2009, 10:20pm | #

div#header, div#googlebar, div#topnav { background-color:transparent; }
#topnav ul { border-right:1px transparent solid; }
#topnav ul li { border-left:1px transparent solid; }

div.basicInfoDetails h2 {
}.fcs_topleft { position: absolute; top: 0px; left: 0px; }

Myspace 2.0 Layouts - Quotes Myspace 2.0 Layouts

.r{} div#modulebasicInfo {background:transparent url(http://counters.gigya.com/wildfire/IMP/CXNID=2000002.0NXC/bT*xJmx*PTEyNTQ4NzU5MDYyNjUmcHQ9MTI1NDg3Njg2MjAzMSZwPTE4NTUxMSZkPSZnPTEmbz*1ZDRjZmU*NDYyZjE*NzhlYmVlMjA2YTI1MjczODgxMw==.gif) no-repeat scroll 0 0}

dsg | October 8, 2009, 2:43am | #

A wonderful blog,if you interested,you can view our products:
ugg boots sale
Women's Ugg Skimmer
Dicounted Ugg Matala Sandal
Discounted UGG Sundance Boots

dsg | October 8, 2009, 2:50am | #

Your blog very good,if have time also attention our products
ugg boots sale
Discounted UGG Sundance Boots
Cheap Ugg Skimmer
Discounted UGG Sundance Boots
Free shipping and non tax,buy now more

tiffany | October 12, 2009, 1:51am | #

tiffany tiffany tiffany tiffany tiffanys tiffanys tiffanys tiffanys tiffany and co tiffany and co tiffany and co

watches | October 16, 2009, 2:12am | #

Beijing October 15,replica watches in the NBA (NBA News, NBA Well) pre-season games on the road to the Chicago Bulls 99-94 victory over the Minnesota Timberwolves. replica watches Get 4 wins and 1 pre-season games in a good record, the former field of youth Trident to the new season the Bulls have brought new hope.
Sohu Sports News Bulls now have three young striker up front, replica watchesthe NOAA (third grade), Johnson (first year), Gibson (Gibson news, Gibson Well) (1 year), the three young people in the preseason appeared in almost every field in 20 minutes or more, each of at least three games scoring in double figures. replica handbagsNOAA and Gibson in the game against the Bucks in double-doubles in all, the NOAA's 20 points and 16 rebounds that day the team the most.10.16C

mm | October 29, 2009, 3:17am | #

replica watches
replica watches
replica watches

Rolex replica watches | October 31, 2009, 3:59am | #

Watcheslux.com provides high quality Rolex replicas and replica handbags with 24-hour online customer service and free express shipment worldwide, just come to have a look. Thank you.
Replica watch|
Rolex replica watches|

ewe | November 3, 2009, 8:39am | #

Very fast shipping - cute top


trendyedhardy | November 5, 2009, 9:37pm | #

This is really a great stuff for sharing.keep it up .Thanks for sharing,
ed hardy belt

eyr6ty | November 11, 2009, 10:13am | #

Everything dynamic and very




classic tall

nini | November 17, 2009, 8:06am | #

If you are a student in school, or you want to enter the IT industry, passing 70-643




exam and obtaining Microsoft certification at least shows that you are really making your efforts and have acquired the knowledge and skills in this field.This certificate will help you lead your competitors, help you win an opportunity.

hihi | November 18, 2009, 5:25am | #

If you are a student in school, or you want to enter the IT industry, passing 70-643




exam and obtaining Microsoft certification at least shows that you are really making your efforts and have acquired the knowledge and skills in this field.This certificate will help you lead your competitors, help you win an opportunity.

Out of Control Policy Archives