Glossary
Design-Build-Finance-Operate-Maintain (DBFOM)
A project delivery mechanism government entities often use to structure the construction of public infrastructure projects such as roads, bridges and airports. In this structure, the government entity enters into an agreement with a private sector party under which it allocates to that party all of the project's duties. This includes designing, constructing, financing, operating and maintaining the project. In exchange for assuming these obligations, the private sector party is entitled to receive, for a specified period, fees from the end users of the project or payments from the government in the form of
availability payments or
shadow tolls. At the end of the period, operating control is transferred back to the government entity. This structure is preferred by many governmental entities because:
- It allocates most of the risks of the project to the private sector.
- They are able to construct a project for which they may not have the financial, technical or operational capacity.
For more information on DBFOM and other structures that may used to construct projects in the US, see Practice Notes:
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