SACRAMENTO — Gov. Arnold Schwarzenegger on Tuesday signaled a controversial push to engage private companies in the building and management of state and local public works projects, proposing a strategy widely employed in Canada, Europe and elsewhere.
In such partnerships, which could take a variety of forms, private companies could finance, build and manage roads, schools, waste-water treatment plants, ports, levees, hospitals and other projects. The companies would rent the facilities to the government or collect fees from users.
Though public-private partnerships have been undertaken in some other states and occasionally in California, such as in the construction of San Diego's South Bay Expressway, state law does not explicitly authorize or set rules for such deals.
Until now, Schwarzenegger's piecemeal efforts to involve the private sector in state government generally have been opposed by lawmakers and labor unions. But the governor is considering an ambitious proposal that would institutionalize private-sector deals, and would need legislative approval for it.
Schwarzenegger, who has repeatedly criticized the state's failure to maintain its public works, said he would offer more details in his State of the State speech in January. He said California needs $500 billion in public projects over the next two decades to catch up to, and keep up with, rapid population growth.
"There's not enough money there in the public sector, in the tax base," Schwarzenegger said Tuesday morning at a forum on information technology sponsored by USC. "We could never afford that.
"When you're governor, I think that you have to really be able to look at people in the eyes and say, 'I can guarantee you that in 30, 40 years from now, when you turn on your faucet, there will be water coming out,' " Schwarzenegger said.
The governor's plan also could involve leasing existing state assets, along the lines of his proposal to privatize the lottery to pay for a healthcare overhaul. But aides said sell-offs of state property were not on the governor's immediate agenda.
Advocates say that working with the private sector can benefit the public by shifting the financial risk, and the outlay of money, to businesses. They also argue that although governments let roads, bridges and buildings erode when budgets are tight, private companies will keep them in good repair because they stand to lose too much if they don't.
