Out of Control Policy Blog

Arizona Enacts Cutting-Edge PPP Enabling Law

As both an advocate of private sector road financing and an Arizona taxpayer, I'm pleased to report that Arizona Gov. Jan Brewer has signed into law House Bill 2396, which overhauls and modernizes the state's enabling legislation to facilitate privately-financed transportation infrastructure through public-private partnerships (PPPs).

This is a very positive development for Arizona which, despite the current recession and hard-hit metro housing market, is poised for significant long-term growth and lacks the funding for the infrastructure necessary to support it. As I wrote in the Arizona Republic last March:

Public-private partnerships offer Arizona good options at a time when tax dollars are stretched thin and traffic is worsening. These partnerships won't entirely close the funding gap, and they won't be appropriate for every project. But they are a powerful tool that is particularly well-suited for big-ticket projects like interstate expansions; truck-only toll lanes to improve safety; boosting the economy by speeding the movement of goods; and adding road capacity in the Phoenix-Tucson corridor. [...]

The potential in Arizona is tremendous. Private companies can finance roads upfront and get them built quickly. For the health of the economy, it is vital that Phoenix's infrastructure investment keep pace with population growth.

Those worsening morning commutes across the Valley are evidence that the government is struggling to do so. The status quo will deliver aging roads and traffic jams. It's time to fundamentally rethink how we fund our roads and highways.

The enactment of HB 2396 is a sign that the "rethinking" is well underway in Arizona. Kudos to the legislature, Brewer and the Arizona Department of Transportation for taking proactive steps to address the state's looming growth challenges and joining California, New York, Puerto Rico and other states that have recently embraced PPPs and innovative transportation finance to close major infrastructure gaps.

For more on HB 2396, see here, here and here.

ยป Reason's Transportation Research and Commentary

Leonard Gilroy is Director of Government Reform


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