By Bill R. Shelton, CEcD
Downtown revitalization strategies are highly dependent on upfront public investment to attract private investment and put in place market mechanisms that are responsive to changing needs of businesses and investors. Specifically, successful downtown revitalization is a function of joint ventures between the public and private sectors who partner in planning, financing and implementing revitalization strategies.
Public sector investment in infrastructure works with private investment in buildings, hotels, transportation and shopping developments. Often public sector investment is required to acquire, clear and develop sites and subsidize or offer tax incentives to attract private sector investment.
The majority of downtown revitalization strategies fail to produce the desired results. Why is this? Because the revitalization strategies are generally static and didn’t take into account the implementation of the plan. Successful implementation requires the ability of the community to structure Public-Private Partnerships (PPP or P3s). Yet a 2009 report of the National Conference of State Legislators found that 61 percent of state and local officials had no experience dealing with P3s and did not fully understand them.
Public and Private Partnerships
To jump start your downtown revitalization strategy, begin by adding an aggressive implementation strategy to structure viable PPPs. Following are four organizational recommendations from a Brookings report titled “Drivers of Successful Public-Private Partnerships:”
1. Understand the private sector needs. Strong partnerships are based on finding the right alignment of interests, which is why it is essential to understand what makes a project appealing to private sector investors.
2. Pick politically smart projects. A successful PPP requires a pragmatic understanding of what is feasible in a constantly evolving political environment.
3. Find the right revenue stream. PPPs are not free money; they require localities to find durable and resilient revenue streams that will pay for the investment over the long-term.
4. Actively engage with stakeholders. PPPs are inherently complex deals that require significant public engagement to ensure that the deal is in the best interest of the community and executed at the highest standards at all time.
PPPs require decades of attention with thoughtful monitoring, flexibility in the face of a changing world and a willingness to learn from mistakes. With viable PPPs, your downtown revitalization strategy may be energized and no longer be held back.