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Procurement methods and types of contract
Published in Chris March, Construction Management, 2017
There are several forms of contract for PFIs and PPPs, examples are shown below: Build–operate–transfer (BOT): used for infrastructure projects and PPP, the public body contracts with a private sector body to design and build the infrastructure, operate and maintain this facility for a fixed period. The private company raises the finance for the project and retains all revenues generated until the end of the period when it is transferred back to the public authority.Build–operate–own–transfer (BOOT): similar to BOT except that the private company owns the facility until transferred back to the public authority.Design–build–finance–operate (DBFO): similar to BOOT except there is no ownership transfer from the public authority. Used in particular for toll roads.Build–own–operate (BOO): in this case ownership remains normally with the private company.
Introduction
Published in John E. Schaufelberger, Len Holm, Management of Construction Projects, 2017
John E. Schaufelberger, Len Holm
Contracts awarded in the public–private partnership (PPP) project delivery method are known as build-operate-transfer (BOT) contracts. Under these contracts, a private sponsor, usually a consortium or joint venture, executes a contract with a public agency to finance, design, construct, and operate a project for a specified period of time. At the end of the operating or concession period, ownership of the project is transferred from the private sponsor to the government agency. In this delivery method, a government agency identifies project requirements, establishes the concession period for project operation, solicits proposals, and awards the contract. The project designer and constructor may be joint venture participants or may be subcontractors to the private sponsor. Funding for the project may come from equity participation in the sponsoring consortium, loans, or the sale of bonds. During the concession period, the project sponsor collects revenues from operation of the project to recover its investment and earn a profit. This delivery method is often used for large infrastructure projects such as highways that charge tolls for use and power plants that sell generated electricity.
Contractual matters
Published in Klaus Kirsch, Fabian Kirsch, Ground Improvement by Deep Vibratory Methods, 2016
Where BOT contracts are concerned the employer’s risk for the geotechnical conditions is passed on to the contracting consortium, which has to carry out all necessary investigations for the design and execution of the works and which employs therefore its own engineer.
Project-focussed literature on public-private partnership (PPP) in developing countries: a critical review
Published in Production Planning & Control, 2022
Ahmad Meile Almeile, Maxwell Chipulu, Udechukwu Ojiako, Ramesh Vahidi, Alasdair Marshall
As not all definitions of PPP are agreed upon (Liu et al. 2015a; Zhang et al. 2020), the search code included all the main PPP definitions: Public-Private Partnership (PPP), Private Finance Initiative (PFI), and Build-Operate-Transfer (BOT). In PFI, financing rests mainly with the private sector. PFI was first launched in the United Kingdom (UK) in the 1980s, it has been used in, among others, Australia, the United States and New Zealand (Raisbeck, Duffield, and Xu 2010). BOT is mainly used in infrastructure projects as a delivery/financing system by the private sector (Algarni, Arditi, and Polat 2007). The government allocates the private sector a specific concession period during which it collects revenues by operating and maintaining the infrastructure (Zhu, Xu, and Hu 2016; Le et al. 2021). We employed ‘Construction’ or ‘Infrastructure’ in the search string as a means of ensuring that our search not was not limited to literature focussed on building-related construction. More specifically, the IPA (2021) notes that ‘Infrastructure and Construction projects include improving and maintaining [] energy, environment, transport, telecommunications, sewage and water systems; and constructing new public buildings’ (4).
The role of irrigation associations and privatization policies in irrigation management in Turkey
Published in Water International, 2020
With the strategic orientation of global actors, such as the World Bank, the water sector has experienced a massive wave of privatization covering different regions of the world. In this context, from the 1980s onward, Turkey has experienced extensive privatization in a number of sectors, including water and energy distribution, hydropower infrastructure, telecommunications and health care. The government has been looking for alternative ways to channel professional expertise through numerous forms of public–private partnerships, which were/are expected to contribute to achieving national goals in affordable ways. BOT was one of the first public–private partnership models implemented in various large-scale public facilities in Turkey. The BOT model is seen as an effective way to generate a partnership between public and private sectors and to join their financial resources, know-how and expertise to meet the challenges facing service provision systems normally supplied by governments.
Improving decision-making in maintenance policies and contract specifications for infrastructure projects
Published in Structure and Infrastructure Engineering, 2019
Jorge-Mario Lozano, Mauricio Sánchez-Silva
In road infrastructure projects, the most common delegation is known as built-operate-transfer (BOT), where the private company builds and manages an infrastructure project during a specific time period, after which, it is transferred back to public authorities (Auriol & Picard, 2013). A BOT contract scheme benefits both the government by providing high quality infrastructure, and the private firm by offering the possibility to manage the revenue strategies (Sadka, 2006). In the case of this paper, a branch of the BOT structure is used, where: the government, is in charge of identifying infrastructure needs, constructing a desirable contract for the private entity, and monitor that the infrastructure is at an adequate level for users; the private entity, on the other hand, is involved in financing, constructing, and managing the project in return for a promised stream of payments directly from the public entity.