April 1999 Pu

Pa

Te

B

Pa

GAO/GGD-99-71

In recent years, governmen

limit costs without reducin

various initiatives have bee

the government in managin

initiatives that in many case

local level as well as efforts 

fiscal demands, federal age

managing buildings in a mo

exploring the formation of 

government and the private 

These partnership initiative

wide variety of terms, many 

subtly different meanings. 

facilitate a better understan

related terms as they are us

sectors. This document wa

Representative Steve Horn, 

Government Management, I

Committee on Government 

Franks, Chairman, Subcom

Public Buildings, Hazardou

Transportation, House Com

Infrastructure.

Our objective was to descri

practices, and techniques c

government and private sec

The private-sector party can 

from designing the public-p

financing, construction, op

and/or ownership.

As we developed this gloss

glossaries already in print, 

published by experts and p

common terms in the gloss

developed working definitio

Page 
current federal usage. The 

Environmental Finance Pro

Tools, Environmental Prote

Privatization Primer, Nation

Partnerships, 1996; (3) Dict

Edition, Barons Educationa

Terms Related to Privatizat

GGD-97-121, July 1997); (5) 

Federal Budget Process, Ex

Jan. 1993); and (6) Glossary 

National Mortgage Associat

consulted the following sou

Appraisal, Dearborn Financ

Office of Management and 

glossary is an expanded ver

published in our report ent

Key Elements of Federal B

(GAO/GGD-99-23, Feb. 3, 19

from the following compan

provided important input: (

Potts, & Trowbridge, (2) La

Inc; and (4) Signet Partners

Don Bumgardner and Alan 

this glossary. Please contac

any questions.

J. Christopher Mihm

Associate Director, Federal 

 and Workforce Issues

Page 2 
Types of

Public-Private

Partnerships

Build-OwnOperate (BOO)

Und

con

fac

to t

fac

and 

sec

title

tax

if a

req

Build/Operate/

Transfer (BOT) or

Build/Transfer/

Operate (BTO)

Und

par

spe

age

spe

or f

age

to t

spe

the 

som

fac

fran

the 

rea

thro

At t

pub

res

the 

hol

Page 
fran

BTO 

exc

ow

con

at t

Buy-Build Operate

(BBO)

A B

sale 

exp

gov

priv

the 

the 

Contract Services

Operations and

Maintenance

A p

gov

con

pro

ser

and 

par

ma

sys

Operations,

Maintenance, and

Management

A p

gov

con

ope

fac

Und

par

fac

may 

or s

car

con

Page 
effi

of t

the 

opp

inv

ava

inv

retu

this 

was

Design-BuildOperate (DBO)

In a 

awa

and 

imp

rem

the 

des

des

DB

to t

app

Sta

sec

con

eng

con

con

tak

A s

a si

des

pro

ove

pha

pro

nor

or a

a se

Page 
agr

into 

con

inv

priv

pro

gen

Developer

Financing

Und

par

fina

of a 

righ

com

fac

dev

ope

of t

the 

rec

Wh

bui

cha

cap

pay

the 

arra

cre

Dev

or i

spe

Enhanced Use

Leasing (EUL)

An 

pro

Aff

of d

leas

bui

Page 
the 

pro

pub

retu

(mo

VA

U.S

Lease/Develop/

Operate (LDO) or

Build/Develop/

Operate (BDO)

Und

the 

exi

inv

mo

and 

wit

diff

fac

dev

arra

Lease/Purchase A le

inst

this 

and 

leas

age

pay

pub

fac

of t

ow

cos

in t

Und

may 

age

the 

arra

Page 
Gen

bui

a n

oth

Sale/Leaseback A s

arra

fac

sub

new 

ent

arra

An 

sale

a p

hol

lim

cer

arra

the 

to o

Tax-Exempt Lease Und

a p

or f

priv

The 

title 

the 

beg

por

pay 

is t

law

use

cap

to t

mu

Page 
Turnkey Und

age

inv

com

spe

crit

and 

com

pric

of m

Gen

priv

con

des

trad

reg

ena

the 

for 

acc

con

In a 

ow

eith

exa

pro

atte

the 

fina

for 

fac

Page 
Other Terms

Related to

Public-Private

Partnerships

Air Rights Air 

con

des

ofte

ano

Anchor Tenant An 

tha

a co

ten

ma

typ

typ

Asset Sale An 

ow

priv

Exe

pric

prio

has 

ma

afte

sold 

mo

gov

asp

rate

Capital Lease A c

refl

Page 
as a

Gen

the 

eco

leas

Ope

Cash Flow Cas

disb

or a

stat

of c

cas

nex

Concession

Benefits

Con

rec

fixe

fran

Cooperative

Agreements

A c

31 U

exe

rela

gov

gov

(1) 

rela

valu

oth

pur

aut

(2) 

bet

stat

rec

con

Page 
Equity Equ

ma

am

Fee Simple A fe

unq

wit

inc

disp

Franchising Und

ser

con

priv

bus

geo

ope

and 

nat

reg

use

dire

Ground Lease A g

and 

a lo

lan

Lease A le

the 

stip

the 

for 

am

Page 
Leasehold Estate A le

pro

a le

Leveraged Leasing In l

ow

tax 

by 

the 

from 

fac

Operating Lease An 

nor

the 

less 

the 

ser

ope

cap

acq

ben

Partnership A p

exi

con

prin

Public-Private

Partnership

Und

som

pub

arra

and 

arra

gov

priv

ope

Page 
fac

tha

Und

may 

fac

gen

des

Typ

inc

Suc

arra

ser

priv

sub

inv

pub

rev

wit

priv

Public Purpose

Debt

Pub

fina

valu

can 

sec

bon

qua

Request for

Proposals (RFP)

An 

gov

con

per

pro

pro

pro

pro

Page 
Request for

Qualifications

(RFQ)

An 

use

and 

par

ma

dev

app

req

it p

qua

con

rec

pot

det

req

Revenue Bonds Rev

of i

sec

equ

gen

bac

the 

rev

fac

Bec

gov

ear

Inte

Revolving Funds Rev

aut

col

fina

bus

yea

rev

com

and 

Page 
use

rev

pro

by t

to r

to f

pro

Rev

acc

ma

but 

age

fina

pur

eno

Con

Risk Unbundling Ris

fac

pub

dev

pro

priv

priv

tho

nat

con

gov

Sublease A s

a le

diff

ma

agr

obl

Page 
OR

Cop

by 

U.S

P.O

Wa

or b

Roo

700 

Sts

U.S

Wa

Ord

(20

(20

On 

We

acc

(410434) Page