Public-Private Partnership (P3) Procurement: a Guide for Public Owners
Total Page:16
File Type:pdf, Size:1020Kb
Public-Private Partnership (P3) Procurement: A Guide for Public Owners March 2019 Public-Private Partnership Procurement Guide Notice This document is disseminated under the sponsorship of the U.S. Department of Transportation in the interest of information exchange. The U.S. Government assumes no liability for the use of information contained in this document. The U.S. Government does not endorse products of manufacturers. Trademarks or manufacturers’ names appear in this report only because they are considered essential to the objective of the document. The contents of this report reflect the views of the authors, who are responsible for the facts and accuracy of the data presented herein. The contents do not necessarily reflect the official policy of the U.S. Department of Transportation. This report does not constitute a standard, specification, or regulation. Quality Assurance Statement The U.S. Department of Transportation (U.S. DOT) provides high quality information to serve Government, industry, and the public in a manner that promotes public understanding. Standards and policies are used to ensure and maximize the quality, objectivity, utility, and integrity of its information. U.S. DOT periodically reviews quality issues and adjusts its programs and processes to ensure continuous quality improvement. Public-Private Partnership Procurement Guide Form DOT F 1700. 7 (8-72) 1. Report No. 2. Government Accession No. 3. Recipient’s Catalog No. FHWA-HIN-18-004 4. Title and Subtitle 5. Report Date March 2019 Public-Private Partnership (P3) Procurement: A Guide for Public Owners 6. Performing Organization Code FHWA 7. Authors 8. Performing Organization Nancy Smith, Patricia de la Peña, Edward Kussy (Nossaman LLP), Sonika Sethi Report No. (Leidos), Porter Wheeler, Jonathan Gifford (George Mason University), Shirley Ybarra 9. Performing Organization Name and Address 10. Work Unit No. (TRAIS) Leidos 11251 Roger Bacon Drive 11. Contract or Grant No. Reston, VA 20190 DTFH61-13-D-00022 12. Sponsoring Agency Name and Address 13. Type of Report and Period Federal Highway Administration Covered Office of Innovative Program Delivery 1200 New Jersey Avenue SE 14. Sponsoring Agency Code Washington, DC 20590 HIN-CIFS 15. Supplementary Notes The FHWA Task Order Contracting Officer’s Representative (TOCOR) for this project was Patrick DeCorla-Souza. 16. Abstract This Public-Private Partnership Procurement Guide (Guidebook) has been developed in coordination with the U.S. Department of Transportation (U.S. DOT) Build America Bureau, the Federal Transit Administration (FTA) and the Federal Highway Administration (FHWA) to provide advanced guidance on procedures, issues, and considerations involved in public- private partnership (P3) procurement of surface transportation projects, in particular for highway and transit investments. This Guidebook is part of the P3 Toolkit that consists of P3 guidance documents and tools to assist in educating Federal, State, and local policy makers, legislative and executive staff, and transportation professionals. 17. Key Words 18. Distribution Statement Public-Private Partnership, Procurement, highway investment, No restrictions. transit investment 19. Security Classif. (of this report) 20. Security Classif. (of this page) 21. No of Pages 22. Price Unclassified Unclassified 150 N/A Form DOT F 1700. 7 (8-72) Reproduction of completed page authorized. Public-Private Partnership Procurement Guide Public-Private Partnership Procurement Guide Table of Contents 1. INTRODUCTION ................................................................................................................................ 1 1.1. Guide Purpose and Background .................................................................................... 1 1.2. What Are Public-Private-Partnership Agreements? ...................................................... 2 1.3. Project Examples ............................................................................................................. 3 1.3.1. VIRGINIA DEPARTMENT OF TRANSPORTATION I-495 CAPITAL BELTWAY HIGH- OCCUPANCY TOLL LANES, VIRGINIA ....................................................................................... 4 1.3.2. MARYLAND PURPLE LINE LIGHT RAIL TRANSIT SYSTEM ........................................................... 4 1.3.3. TEXAS DEPARTMENT OF TRANSPORTATION NORTH TARRANT EXPRESS PROJECT, FORT WORTH, TEXAS ................................................................................................................... 5 1.3.4. COLORADO HIGH PERFORMANCE TRANSPORTATION ENTERPRISE, U.S. 36 ............................... 5 1.3.5. OTHER REFERENCED PROJECTS ............................................................................................ 5 1.4. Structure of the P3 Procurement Guidebook................................................................ 6 2. OVERVIEW OF PROCUREMENT PROCESSES AND FEDERAL ASSISTANCE ISSUES RELEVANT TO PUBLIC-PRIVATE PARTNERSHIPS ..................................................................................................... 8 2.1. Comparison of P3 and Traditional Project Delivery Procurement Processes ............. 8 2.2. State and Local Laws Affecting Public-Private Partnerships...................................... 10 2.3. P3 Procurement Successful Practices ........................................................................ 12 2.4. Overview of Federal Programs Providing Funding and Financing for Public-Private Partnerships ........................................................................................................................... 15 2.4.1. FUNDING FROM THE FEDERAL HIGHWAY ADMINISTRATION .................................................... 15 2.4.2. TOLLING OF FEDERAL-AID HIGHWAY FACILITIES ................................................................... 16 2.4.3. FEDERAL TRANSIT ADMINISTRATION FUNDING ..................................................................... 16 2.4.4. TRANSPORTATION INFRASTRUCTURE FINANCE AND INNOVATION ACT FINANCING ..................... 16 2.4.5. PRIVATE ACTIVITY BONDS .................................................................................................. 18 2.4.6. RAILROAD REHABILITATION AND IMPROVEMENT FINANCING .................................................. 19 2.5. Federal Environmental and Regulatory Requirements .............................................. 19 3. PRE-PROCUREMENT PHASE ..........................................................................................................20 3.1. Structuring a Procurement Team ................................................................................. 20 3.1.1. LEADERSHIP AND DECISION-MAKER INVOLVEMENT .............................................................. 20 3.1.2. STAFFING CONSIDERATIONS .............................................................................................. 21 3.1.3. MANAGEMENT OF THE TEAM .............................................................................................. 23 3.1.4. SECURING EXTERNAL CONTRACTOR/ADVISOR SUPPORT ....................................................... 25 3.1.5. ESTABLISHING CONFIDENTIALITY AND ORGANIZATIONAL CONFLICT POLICIES ........................... 26 3.2. Setting the Stage for Successful Project Delivery ....................................................... 27 3.2.1. PROJECT SUITABILITY ........................................................................................................ 28 3.2.2. PROJECT SCREENING, VALUE FOR MONEY AND FINANCIAL VIABILITY ASSESSMENT .................. 29 3.2.3. ARTICULATING PROJECT GOALS AND SCOPE ........................................................................ 30 3.2.4. MAXIMIZING FLEXIBILITY FOR INNOVATION ........................................................................... 30 3.2.5. DETERMINING SCOPE AND TERM OF CONCESSION ............................................................... 31 3.2.6. INITIAL RISK ASSESSMENT AND ALLOCATION ....................................................................... 32 iii Public-Private Partnership Procurement Guide 3.2.7. LEGAL COMPLIANCE ANALYSIS ........................................................................................... 32 3.2.8. ESTABLISHING COMMUNICATIONS STRATEGY ...................................................................... 33 3.2.9. MARKET SOUNDING ......................................................................................................... 33 3.3. Strategies for Environmental and Regulatory Approvals ........................................... 34 3.3.1. TRANSPORTATION PLANNING PROCESS............................................................................... 34 3.3.2. NEPA PROCESS ............................................................................................................... 35 3.3.3. TIMELINE FOR NEPA PROCESS .......................................................................................... 37 3.3.4. THE POTENTIAL ROLE OF THE CONCESSIONAIRE IN THE NEPA PROCESS ................................ 38 3.3.5. NEPA DISCUSSION OF TOLLS ............................................................................................ 38 3.3.6. THE CONCESSIONAIRE’S FLEXIBILITY AFTER COMPLETION OF THE NEPA PROCESS ................. 39 3.3.7. PRIVATE INVESTORS AND MITIGATION ................................................................................. 39 3.3.8. ISSUES RELATED TO OBTAINING PERMITS ..........................................................................