Devising an effective PPP strategy

Railroads are capital - and capacity - constrained, and should welcome new sources of investment capital as long as they do not come with too many strings. Perhaps the biggest benefit of public funding is that it converts the fixed costs of long-lived investments into variable costs for railroads. Public funding need not be in the form of grants. In the case of several recent public projects, such as the Alameda Corridor, part or all of the cost will eventually be paid by the railroads, but only when they use the facility. The current approach to PPPs (public private partmerships) has been ad hoc, with the agreements and details worked out separately for each project.