About P3s

What is a Public-Private Partnership?

A public-private partnership (P3) can be defined as an infrastructure project in which a private contractor:

• provides some or all of the financing for the project;
• designs and builds the project, often providing operations and maintenance for the project, and often backed by an “extended warranty”; and
• receives payments from the government over an extended period of time, subject to deductions for failing to meet contractually defined performance standards.

Why was a P3 selected for this project?

For each project, the Government of Alberta looks at the best way to deliver the best product to meet Albertans’ needs.  In the case of the Phase III New Schools P3 Project, the government’s analysis determined that the best way to efficiently and cost-effectively deliver a large number of much needed new schools in some of Alberta’s fastest growing communities was through a P3 approach.

What are the advantages of using a P3 to provide the 12 new schools?

There are a number of benefits to using a P3 approach for building these 12 schools including:

Economies of Scale

• one contractor is responsible for building all schools
• a fixed construction price is guaranteed
• school delivery (completion) date is guaranteed
• risks are transferred to contractor after tender (examples include inflation in construction costs, and weather-related delays)

Value to taxpayers
Through this P3 approach, the 12 new schools will provide Alberta taxpayers a savings of $43 million compared to the cost of doing the same work through traditional delivery methods.  

Schools completed faster
12 new schools will open in communities with high-priority school infrastructure needs up to two years sooner than if traditional construction methods were used.

30 year maintenance warranty
A key benefit of the P3 is the 30-year maintenance warranty, which ensures students and communities will have a school that is guaranteed to be in good condition 30 years after it opens.