Governments should help finance infrastructure — not construct and run it

Should governments build and operate infrastructure, or should they simply help finance it? Writing in Smart Cities Dive, Bob Hellman argues for a sharp division of labor. The government's proper role is to help fund and oversee infrastructure, while private operators should handle construction and long-term operation.

He builds the case on a run of public megaproject failures. New York's Gateway Hudson River Tunnel, he notes, has already blown past its roughly $13.5 billion plan to exceed $16 billion. Honolulu's Skyline rail has been dogged by cost and schedule problems. California's high-speed rail line, pitched at $33 billion in 2008, is now projected to cost as much as $128 billion, a figure Hellman attributes to a 2025 U.S. Senate report.

The American Infrastructure Partners CEO contrasts these projects with models he sees as accountability-aligned, including the Golden Gate Bridge and the federal TIFIA loan program, where private discipline and public support work in tandem. His conclusion is that when governments try to both build and run infrastructure, they invite the chronic overruns and delays these projects illustrate. Keeping the public sector focused on financing and oversight, while private partners deliver and operate, produces better results for taxpayers.