Public-Private Partnerships (P3) Legislation a Hot Topic at the Florida Logistics & Trade Conference
Public-private partnerships (P3s) received significant attention at the 2014 Florida Logistics and Trade Conference. The overall consensus of the conference’s P3 Panel, which was moderated by Albert Dotson, is that the state of Florida has cultivated a positive climate for P3s to thrive. Florida is prime for new infrastructure development and has established itself as a place where deals actually get made.
The responsibility for funding roads, bridges and transit is shared by the federal government, states and localities. Currently, all of these levels of government have been experiencing challenges in funding transportation infrastructure, revenues have fallen short of expenditures and budget constraints are leaving little funds to go around. This makes P3s all the more attractive and necessary. President Barack Obama proposed to lift the ban on interstate highway tolls in his $302 billion surface transportation draft bill known as the Grow America Act, which would create an alternative source of funding for public-private partnerships to help states implement infrastructure projects and create jobs. The Senate’s version of the bill eliminated the tolling provision, but interest in lifting the toll prohibition and in stimulating the use of P3s has not waned.
The House and Senate demonstrated their support of P3s this week by passing the Water Resources Reform and Development Act, which establishes a Water Infrastructure P3 Program and authorizes and promotes P3s for water resources development and infrastructure projects.
The Evolution of P3s in Florida
At a macro-economic level, the demand from capital markets investors for P3 infrastructure assets continue to be extraordinarily strong, and many states across the country continue to explore P3 as a viable financing mechanism. Virginia, another state leader in P3s, in addition to passing P3 legislation in the 90s, established an Office of Transportation Public-Private Partnerships in 2011 to assist in creating an environment that encourages private investment and invites innovative solutions from the private sector. Florida has positioned itself similarly to Virginia by passing legislation to enable its government entities to get on the P3 path, establish P3 guidelines and signal to the private sector that Florida is “open for business.”
Florida’s P3 legislation will continue to evolve as lawmakers await the findings of the task force that was created to review public-private partnerships and present recommendations and guidelines on July 1st. The refinement of Florida’s P3 law will serve to further encourage the private sector that the state and its municipalities are serious about creating partnerships, and will allow the state’s P3 law to incorporate all of the best practices and safeguards that are needed to make the law successful at providing the foundation for new and innovative projects and developments in Florida. This past term, the legislature considered a public records exemption for unsolicited proposals from private companies in order to protect sensitive and proprietary information and encourage unsolicited proposals. Virginia’s P3 statute already contains such a provision.
Florida is still fashioning its P3 laws and will have the benefit of learning from states like Virginia, enabling it to eventually have one of the best and most effective P3 laws in the country. Nationally, the regulatory environment at all levels of government is rife with support for enacting legislation that will not only promote and expand the use of P3s, but also do so effectively and responsibly.