A P3 plan had been proposed as a possible solution to allow the Yonkers District (New York) to rebuild and/or replace its aging school buildings.

The District's project would be the first social infrastructure P3 for a public school district in the United States. The project would included the implementation of the $1.7 billion Educational Facilities Plan and would encompasse all 40 schools in the District.

Last Wednesday, Yonkers Mayor Mike Spano made public a report that analyzed the feasibility study of the potential P3 project. The Commission of Inquiry into the Finances of the City of Yonker presented the independent report to the Mayor.

Spano said in a statement:

"The report will enable the City and the Yonkers School Board to engage in serious and thorough discussions on what's best for our taxpayers and students. I look forward to the School Board's response to the Report."

The main conclusion of the report is that the P3 report is flawed and that the P3 model may not provide savings for the taxpayer. The report states:

The heart of that recommendation is a finding that the P3 option will generate savings to taxpayers of $63.1 million (9.4%) over its' 35 year life span.

The Commission focused its work in determining how the $63.1 million in savings were calculated. As appears below, we find that both the methodology, the facts and the assumptions used to reach this conclusion are unreliable and replete with errors. These include arbitrary assertions unsupported by fact, and unsupported assumptions that are favorable to the P3 model.

We find that there are serious flaws in the Report that conservatively inflate the savings of the P3 proposal by over $200 million. It follows from this conclusion that there is no rational basis for the assertion that the P3 model will generate $63.1 million in savings. Rather, it is likely that the CFC model will be less expensive.

The Commission Of Inquiry Into The Finances Of The City Of Yonkers was created by Mayor Mike Spano in March of 2012. It was initially asked to determine the size of City operating budget gaps, and to make recommendations for reform and improvement.

In April 2012, Yonkers Public Schools selected the team of Macquarie Capital, Freshfields Bruckhaus Deringer LLP, and URS Corporation as financial, legal, and technical advisors for its landmark Public-Private Partnership (P3) project.

Source: Commission Of Inquiry Into The Finances Of The City Of Yonkers