Catalyzing Investment in Urban Sustainability
U.S.-Brazil Joint Initiative on
Urban Sustainability


Public-Private Partnerships for Urban Sustainability

Program Overview

A public-private partnership is an agreement between a public agency (federal, state, or local) and a private-sector entity that uses the specific skills and assets of each sector for the delivery of a service or facility used by the general public. In addition to sharing resources, the parties also share in the risks and reward potential in the delivery of the service or facility. In many public-private partnerships, a private-sector party may be constituted as a Special Purpose Vehicle, which manages and finances a range of responsibilities that could include the design, building, and operation of a new project.

In many of these partnerships, a private party will finance the construction or expansion of a public facility in exchange for the right to develop the site further through the development of residential housing, commercial stores, or industrial facilities at the site or for the ability to capture the revenues from either the continued lease or sale of the property back to the public entity. Typically, these partnerships are formed for infrastructure development, particularly for transportation or water, but similar partnerships can be formed for any number of urban sustainability and community development projects.

How to Apply this Program

There are a number of public-private partnership models that could be used for urban sustainability projects, including but not limited to, impact fee and developer finance, a turnkey partnership, a sale and leaseback partnership, or a lease and purchase partnership. Regardless of the specific type of public-private partnership, there are a number of recognized best practices to ensure successful implementation. First, having a public sector champion who is able to ensure that development and regulatory processes critical to partnership activities are in place and who can facilitate appropriate community engagement is important. Second, there needs to be a detailed business plan and clearly defined revenue streams for both the public and private-sector parties. Finally, robust engagement with communities that will be impacted by the partnership-including the portions of the public receiving the service or facility, the press, appropriate labor unions, and relevant interest groups-is vital to the success of the partnership.

Contact Information
U.S. EPA's Center for Environmental Finance