This Toolkit aims to help developing country governments, interested in using private firms to help expand access to safe water and sanitation services at reasonable cost. Specifically, it aims to help them, and their advisers design arrangements that maximize the benefits for their countries, provinces, or municipalities. It is intended to complement other work being undertaken by the Bank, and others on options for improving public provision of water services. Instead of identifying a single best approach to addressing the issues it discusses, the Toolkit presents options and discusses their main advantages and disadvantages. In so doing, it aims to give advisers and policy makers the information needed to make decisions, while taking account of local circumstances and the policy makers' objectives. Private participation in water and sanitation (or "water services" for short) can take many forms. This Toolkit focuses on arrangements that involve a private firm in the delivery of services to households and businesses, including management contracts, leases, "affermages", concessions, and divestitures. It does not consider arrangements under which private companies provide bulk water or wastewater treatment to a government-owned utility. Nor does it consider arrangements under which private companies provide selected services-such as billing and collection-to a utility that is still publicly managed.