EXECUTIVE SUMMARY
to urban use) to help finance public investment in designated growth areas in the city. Betterment levies: the state taxes a portion of land-value increases resulting from infrastructure projects. Colombia has used such a betterment levy, the contribución por mejoras, to finance public works. Bogotá has simplified the approach and converted the betterment levy into a general infrastructure tax, packaged into a citywide bundle of public works. Developer exactions and impact fees: developers install on-site and neighbourhood-scale infrastructures at their own expense or pay for infrastructure provided by public authorities. Impact fees cover the external infrastructure cost of the new development (e.g. in the USA). Developer land sales: developers install public infrastructure in exchange for land. It is used to develop new towns and urban areas in partnership with private investors, usually consisting of a mix of affordable housing, largescale public housing and industrial zones (e.g., in Copenhagen and North Africa). Developers are required to build roads and to help pay for major trunk lines that deliver water, wastewater removal and treatment systems, and street lighting. Sale or lease of publicly held land: public land assets are sold and the proceeds used to finance infrastructure investments (e.g. in China). For a major urban highway project, a municipality can transfer the land surrounding the highway to a public-private development corporation, which borrows using the land as collateral to finance highway construction, and then repays the debt and makes a profit by selling or leasing land whose value had increased with its access to the new highway.
Source: Peterson (2009).
PUBLIC MANAGEMENT AND PARTNERSHIPS Basic services are provided by a large variety of operators: local governments; local and national public utilities; small local businesses; international private companies; and joint public-private ventures. In many low- and middle-income countries, small-scale local operators and the informal sector play a complementary role in poor and peripheral urban areas.
Local public management of basic services and infrastructure Public management of basic services is the most common model of basic service delivery in most countries in the world. Decentralization has therefore meant an increasing role for sub-national governments. Public management is evolving fast; in Europe, the strong push for ‘Europeanization’ led to the emergence of hybrid management models across the region, though national traditions still exert an influence. In the USA, dominant