1. Solving Challenges Others Cannot Statutory Frameworks for Public Private Partnerships HMFA Lone Star Chapter 2009 Winter Institute Dallas, TX Christopher D. Lloyd January 23, 2009

2. Presentation Overview What is a Public Private Partnership? Virginia’s PPEA Benefits of PPP PPP Success Stories

3. What is a Public Private Partnership? What is it? - An alternative procurement tool that allows public entities to more efficiently develop infrastructure and achieve better value for the taxpayer - Vehicle to use design-build contracting practices - Leverage private sector expertise to meet public goals - Opportunity to foster innovative financing What it is NOT? - A panacea that resolves all procurement issues - A way to get something for nothing - Privatization

4. What is a Public-Private Partnership? Does not require a formal statutory framework Does require a willingness to innovate and use “non-traditional” procurement methods Transparency and accountability are vital

5. Virginia’s PPEA Allows for solicited and unsolicited proposals to develop or operate a qualifying project A qualifying project is: –education facility (public school and higher ed) –equipment to enhance public safety and security at public buildings –utility and telecommunications and other communications infrastructure –recreational facilities –Technology infrastructure, services, and applications –any building or facility that meets a public purpose and is developed or operated by or for any public entity –any improvements necessary or desirable to any unimproved locally- or state-owned real estate

6. PPEA Process Public body adopts PPEA guidelines Private entity submits proposal to public body or public body issues a solicitation for proposals Public body makes a written determination whether the project is developed using competitive bid or competitive negotiation Competitive negotiation can proceed if the public body determines that this method is “likely to be advantageous” because of the “probable scope, complexity or urgency of the project” or “risk sharing, added value, an increase in funding or economic benefit from the project that would not otherwise be available”

7. PPEA Process Private entity secures confidentiality agreement for FOIA protection Private entity submits a conceptual proposal for review (qualifications and experience, conceptual schedule and cost, public benefit) Open competition period of not less than 45 days (no minimum for solicited projects) Public body determines whether or how to proceed If public body moves forward, asks for a detailed submission (accelerated process permitted) At this phase, schedule and price become locked in One proposer is elevated to the interim/comprehensive agreement stage

8. PPEA Project Structure “Turn-key” project delivery Contractor assumes project cost and schedule risk Opportunity for other revenue generating activities to reduce government cost Team members provide free advice that helps the government even if project is not developed Often achieves project cost savings through value engineering and faster schedule Innovative financing permitted, but government owns in the end

9. Benefits of PPEA Delivery Private sector participation permits use of tax credits and other financing vehicles that have no value to the public sector PPEA and design-build are nationally recognized procurement tools with accepted contract structures Allows for more local government participation in the procurement decision – not managed by a “one-off” entity Public disclosure requirements may insulate against criticism of closed door negotiations

10. PPEA Trends 100+ projects completed or under review 2/3 unsolicited, 1/3 solicited First submission usually wins in unsolicited, but competition helps reduce price More innovative financing Focus on use of surplus land or facilities

11. PPEA Success Stories New education facilities State and regional correctional facilities Water and wastewater Public safety centers Information technology infrastructure IT services

12. PPEA Success Stories

13. NCPPP National Award - 2005

14. Texas PPP Opportunities Public hospitals and healthcare Water and wastewater Colleges and universities with small foundations Public safety and corrections

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