PPP Financial Model Risk Allocation
Analyze how risk allocation between public and private entities affects project viability and cost distribution in mega-project financing
A city needs a $2B transit-rail corridor. You're the finance director deciding the funding model. Each choice locks in revenue streams, cost responsibility, and risk exposure over 30 years. Choose your primary financing approach 100% Public Financing (municipal bonds + tax revenue) Full $2B on public balance sheet; property tax increase 0.8% User fees capped by political pressure; average collection 60% of potential Public absorbs: construction delays, ridership shortfall, inflation, interest rate spikes Cost overruns typical; $400M contingency needed (20% buffer) How do you handle operations shortfall? 100% Private Financing (developer builds, charges tolls, keeps revenue) $0 upfront; but public…
Sign up free — one personalized lesson every day, matched to your role and goals.
Already have an account? Sign in