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Maryland lawmakers consider public-private partnerships

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Local,Maryland,Andy Brownfield

ANNAPOLIS -- A Maryland Senate panel moved forward with a measure to allow public-private partnerships, which give private companies power over roads, schools and public transit in exchange for less upfront taxpayer investment.

The measure specifies when and how private companies could partner with the state on big construction projects without going through the usual procurement process.

The bill has overwhelmingly passed the House. It's a priority of Gov. Martin O'Malley, who has had Lt. Gov. Anthony Brown spearhead the measure through the House and Senate.

Unlike typical projects for which the state contracts with a private company to build the project using taxpayer money, in a public-private partnership the private business undertakes much of the cost itself and is repaid through fees on users of the finished product, such as highway tolls. That can mean higher costs for drivers, as private companies typically charge higher tolls than states.

However, the projects would still involve millions of dollars in taxpayer money, and opponents worry that circumventing the typical procurement process would result in a shadowy process without as much oversight over how Marylanders' tax dollars are spent.

Maryland Secretary of State John McDonough assured members of the Senate Budget and Taxation Committee that the bill had been changed to allow more oversight from lawmakers and require stricter reporting.

"It does provide for an audit, it provides for additional review time," McDonough said.

"It's essentially the House bill with some improvements on oversight."

Virginia approved public-private partnerships in 1995. A study by consultant KPMG commissioned by the state showed that Virginia initiated more public-private road partnerships than any other state in 2012 -- and many countries, including Australia, Belgium and Canada.

Virginia approved about $3 billion in public-private road projects in 2012.

A recent example is the Capital Beltway Express toll lanes, meant to alleviate congestion, which opened in November. The project consisted of 14 miles of toll lanes -- two lanes in each direction -- where drivers are charged higher rates at peak hours to avoid jams. Officials estimate the average trip costs drivers between $5 and $6.

Maryland has a public-private partnership at the Port of Baltimore and one to operate travel plazas along Interstate 95.

Maryland officials estimate between 6 percent and 10 percent of the state's infrastructure needs -- including the proposed light-rail Purple and Red lines in the Washington suburbs and Baltimore, respectively -- could by financed through public-private partnerships.

abrownfield@washingtonexaminer.com

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