In this paper，we focus on public-private partnership projects whose revenue depends on charges collected from users．We investigate whether the government should extend the private sector’s operation period when the demand unexpectedly declines so that Pareto improvement can be achieved for both the private sector and consumers．Our results show that ( 1) in some scenarios the Pareto-improvement can be achieved by solely dropping price without need for an extension of the operation period; ( 2) when an extension is needed to realize the Pareto-improvement，the added period depends on the operation costs and renegotiation costs of the government and the private sector，respectively．Our study intends to provide theoretical support for the government when making operation period extension decisions．