Highest-ranked Puerto Rican federal transportation official touts benefits of PPPs
Saying the private sector is as responsible as the government for ensuring that transportation infrastructure is in good shape, Orlando Gotay, the highest-ranked Puerto Rican in the U.S. Department of Transportation, urged “more action and participation” from them, as well as regular citizens, in the decision-making process to address Puerto Rico’s present and future needs.
Gotay, who was sworn in as the federal agency’s Deputy Maritime Administrator in June 2010, provided insight on the importance of having a functioning transportation system for Puerto Rico’s economic development.
“We need you to remind the general public that our transportation system is facing a crossroads. All of us collectively must decide if we move it forward or we let it fall by the wayside,” said Gotay. “If we choose the latter, the future entrepreneurs will find the arteries of commerce impermissibly clogged.”
Prior to being appointed to the federal position, Gotay was counselor to San Juan Mayor Jorge Santini. He was the first general manager of the San Juan Port Commission created in 2007 to increase the city’s maritime presence, foster the growth of a healthy maritime industry, and improve existing conditions at the port.
In his presentation, Gotay spoke about the proposed National Infrastructure Reinvestment Bank, which would be run as a public-private partnership to push for long-term financing for major projects throughout the nation. Not yet a reality, the proposed $60 billion entity is gaining certain support from stateside private organizations and unions, as the ideal mechanism to improve transportation and infrastructure conditions.
“The bank would select projects to build and finance based on a rigorous analysis and would use private capital to increase the benefit of federal dollars, this is something that is different from how things were done in the past when the money was granted just because,” he said. “Through a competitive process, proponents must prove the projects will come through with what they promise to do.”
Gotay’s comments on the need for transportation-related PPPs came a few days after the government awarded a $1.4 billion, 40-year management contract of two main island highways to a consortium made up by investment bank Goldman Sachs and Spanish toll road operator Abertis.
While stressing that the local government did not need permission from the U.S. Department of Transportation to turn over the upkeep of PR-22 and PR-5 to a private group, Gotay noted that this type of agreement “allows maximizing the use of resources.”
“Puerto Rico’s population will continue to grow and that means that the island’s roads and transportation system will need to keep up with that,” he said. “The government has two choices: either it responds to that on its own, which in reality they can’t, or they seek alliances with sectors that are able to.”
The proposed Infrastructure Bank follows that same goal of uniting public and private sector efforts, so “inasmuch as that PPP does the same, it would be aligned with that philosophy, which we see favorably,” Gotay said.
The highway PPP contract will be signed today at La Fortaleza.