Modeling the interaction of parties of a public-private partnership for the design/development of regional freight transportation infrastructure

An approach to the interaction between a regional administration and private investors based on estimating the volume of private investment needed to design/develop a regional freight transportation infrastructure is proposed. The estimates of the required investment volume and those of the amount of the revenue expected to be generated by the infrastructure functioning are key ones in negotiations of the regional administration with the private investors on forming a potential public-private partnership to finance the development/modernization of the infrastructure. A decision-support tool for estimating the required volume of private investment to this end is proposed. The tool includes a) a mathematical model underlying three problems formulated on its basis depending on the information available to the decision makers–two mixed programming problems and a minimax problem, which is proven to be reducible to a mixed programming one with all integer variables being Boolean, b) a standard software package for solving mixed programming problems, and c) a software package for processing data. The use of the tool in structuring negotiations between a regional administration and private investors is discussed.