Published November 6, 2024 on EFCnetwork.org
Greenprint CEO April Mendez discusses best practices for designing a Community-Based Private-Pubic Partnership (CBP3).
A Community-Based Public-Private Partnership (CBP3) can be a powerful model for tackling urban infrastructure challenges, particularly in managing stormwater and improving community resilience. For these partnerships to succeed, several core elements must align to create a balanced and mutually beneficial relationship between public entities, private partners and the community. Without these core elements, utilities may find their projects not meeting intended criteria or may even put their community relationships at risk.
But wait, what is a CBP3?
A CBP3 is a partnership between local governments (public), private sector partners and community stakeholders to implement sustainable water infrastructure projects with measurable benefits that are valued by the community. This can look like: a public utility partnering with an engineering firm to deliver green stormwater infrastructure or lead service line replacements across their service area, or a state agency partnering with a program management firm to administer a statewide greening schoolyards program.
Avoiding pitfalls
Two common missteps that can happen early in the program design process are:
- Overemphasis on a fixed price per unit of impact
CBP3s often define priced metrics for success that guide the private partner’s work, such as dollar per gallon of stormwater management capacity or dollar per foot of lead service lines replaced. This is an effective way to align on what matters most and the budget to deliver it. However, this can also lead to reduced impact and transparency as the private partner is incentivized to maximize the units delivered at the lowest cost to them, benefiting from a higher profit margin rather than delivering more outcomes with the excess resources. The private partner may seek to cut costs on community engagement, thereby compromising community trust or to squeeze subconsultants, limiting benefits to the local workforce. The public partner is not guaranteed access to actual cost information, reducing their ability to understand and manage to the true cost of delivery.
Instead, we encourage the use of price caps rather than fixed per-unit pricing to achieve the same goals of controlling expenses without the public partner losing insight into cost and labor breakdowns for deliverables. An overall program price cap set at the same level as an aggregate fixed price ($ per unit x # units) allows for flexibility in costs from project to project while offering transparency to project costs to the public partner.
- Giving program control to the private partner
Without overall control of its infrastructure projects, the utility can lose its ability to direct and prioritize what is most important to them, which can jeopardize the success of the program as well as community relationships. While it is attractive to see a CBP3 as a total solution to internal capacity constraints for the public partner, giving up too much control can lead to unintended outcomes that are difficult to control with success metrics alone. The relationship between the public and private partner is where these preferences are ultimately clarified and negotiated in day-to-day decision making and we recommend structuring the program around that central relationship.
Key elements for CBP3 success
These principles are essential in designing a successful CBP3:
1. Program structure meets public partner’s needs
A successful CBP3 starts with a program structure that aligns with the public partner’s unique needs and goals. Flexibility and adaptability are crucial in designing a partnership that supports these objectives, ensuring the program can address evolving challenges effectively.
2. Strong communication + teamwork
Like a healthy marriage, a CBP3 thrives on strong collaboration. Constant communication, joint decision-making and a unified approach to problem-solving builds trust and creates a solid working relationship. This cooperative foundation is key to ensuring long-term program success.
3. Private partner builds public trust + support
For any CBP3 to succeed, the private partner must connect with the community in meaningful and authentic ways. By engaging community members and addressing their needs, the private partner helps foster trust and support, laying the groundwork for projects that are not only sustainable but also embraced by the people they serve.
4. Public partner retains program control
While the public partner maintains overall control, a successful CBP3 allows for private sector innovation to shine through. Leveraging the private partner’s expertise while retaining oversight ensures that both public interests are protected and innovative solutions can flourish.
5. Flexible + adaptable contracting
Flexibility within the contract is vital to allow for adaptive management. By being open to new opportunities and adjusting the program as it evolves, the partnership can continue to meet its goals even as circumstances change, ensuring lasting success.
6. Clear + achievable metrics
Clear and simple metrics are key to maintaining a focused, goal-driven CBP3. Programs that set straightforward, achievable targets remain efficient and aligned with their objectives, avoiding unnecessary complications or misalignment.
7. Thoughtful + fair risk-sharing
Thoughtfully balancing risk between partners is critical to building confidence within the partnership. By sharing responsibility fairly, both parties can manage uncertainties without overwhelming each other, creating a more stable and effective collaboration.
8. Full transparency to all stakeholders
Transparency is fundamental to trust and accountability. Regular updates and open communication ensure that all stakeholders — public and private — are kept informed of the program’s progress, ongoing projects and new opportunities, reinforcing confidence in the partnership’s integrity.
Conclusion
A thoughtfully crafted CBP3 serves as a powerful framework for achieving long-lasting success in public-private collaborations. By tailoring the program structure to meet public partner needs, fostering a partnership rooted in trust and communication, and engaging the community meaningfully, CBP3s create strong foundations for impactful projects. Flexibility, fairness and transparency further ensure that the partnership can adapt to new challenges and opportunities, delivering real, measurable benefits.
To learn more, read our case study on a successful CBP3 model in action, or download our CBP3 best practices one-pager (PDF).
