> The idea of having Boring Company pay for the construction and then reap the profits strikes me as a really great idea.

We could do what all normal business does for infrastructure. Revolutionary idea.

But it is a good idea. Often private mass transportation is illegal. This seems to be a hybrid model, I don't quite understand what this project entails in terms of obligations by both sides.

The downsides might be that they go bankrupt with a half finished tunnel and then the government has to either put in money to finish the project or start a new project.