Midterm Quiz 1

Question 1

The government (public authority) hires a private company or entity to carry out one or more specified task or services

Answer 1

Service contracts

Question 2

Duration of Service Contracts

Answer 2

1-3 years

Question 3

The government pays the private partner a predetermined fee for the service, which may be hased on a one-time fee, unit cost, or other basis

Answer 3

Service Contract

Question 4

Expands the services to be contracted out to include some or all of the management and operation of the public services ( utility, hospital, port authority)

Answer 4

Management contract

Question 5

Duration of management contract

Answer 5

3-5 years

Question 6

Private partner is responsible for the service in its entirely and undertakes obligations relating to quality and service standards

Answer 6

Lease Contract

Question 7

Do not involve any sale of assets to the private sector

Answer 7

Lease Contract

Question 8

Duration of the lease contract

Answer 8

8 - 10 years but can be renewed up to 20 years

Question 9

Specialized concession in which a private firm or consortium finances and develops a new infrastructure project or major component according to performance standards set by the government

Answer 9

Build-Operate-Transfer and Similar Arrangements

Question 10

The private partner provides the capital required to build the new facility. The private operator now owns the asset for a period set by the contract - sufficient to allow the developer time to recover investment costs through user charges

Answer 10

Build-Operate-Transfer

Question 11

Where the transfer to the public owner takes place at the conclusion of construction rather than the end of the contract

Answer 11

Build-Transfer-Operate

Question 12

Where the developer constructs and operates the facility without transferring ownership to the public sector

Answer 12

Build-own-operate

Question 13

Ownership is never in private hands. Instead, a single contract id put for the design, construction, and operation of the infrastructure project

Answer 13

Design-build-operate

Question 14

The responsibilities for designing, building, financing, and operating are bundled together and transferred to private sector partners

Answer 14

Design-build-finance-operate

Question 15

The public sector is responsible for
establishing performance standards and
ensuring that the concessionaire meets
them.

Answer 15

Concession

Question 16

The public sector’s role shifts from being
the service provider to regulating the
price and quality of service.

Answer 16

Concession

Question 17

Duration of concession

Answer 17

25-30 years

Question 18

The concessionnaire is responsible for any capital investments required to build, upgrade, expand the system for financing those investments out of its resources and from the traffis paid by the system users

Answer 18

Concession