NCSL P3 State Legislative Update: 2016-2018

6/18/2019

Introduction

Public-private partnerships (P3s) are a focus for many state lawmakers across the country as states tackle the increasing demand for updated and new infrastructure facilities. A P3 model has been implemented in dozens of states over the past three decades with varying success. Regardless of the project or infrastructure type, experts agree a first step to ensuring successful P3s, both for the public and private sectors, is sound public policy.

This webpage focuses on enacted state P3 legislation between 2016 and 2018 and is intended to be an update to existing NCSL resources that catalog the state enabling statutes for P3s, specifically Public-Private Partnerships for Transportation: Categorization and Analysis of State Statutes and Building-Up: How States Utilize Public-Private Partnerships for Social & Vertical Infrastructure

The policy implications and outcomes of P3s, including benefits and shortfalls, have been widely documented. You can learn more about these topics by visiting these resources: 

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State Legislation

US map showing P3 statutes.

As of February 2019, 38 states, Puerto Rico and D.C. statutorily authorize P3s for the transportation sector. Fifteen of those states extend their authority beyond transportation, and three separate states authorize P3s only for sectors outside of transportation. State enabling statutes range from project-specific authority to a limited authority based on project size, scope, or timeframe to broad comprehensive frameworks for P3 agreements.

To view details on existing P3 enabling statutes, visit NCSL’s Public-Private Partnerships for Transportation: Categorization and Analysis of State Statutes. Many of the bills listed below have amended existing statutes examined in this 2016 report.

Since 2010, public interest in P3s has expanded from the transportation sector into other types of public infrastructure. This trend is reflected in the legislation enacted in the last three years. Most commonly, states now provide statutory authority for P3s for a range of infrastructure types and for multiple public agencies.

NCSL’s Transportation Funding and Financing Legislation Database tracks introduced, considered and enacted legislation from all 50 states each year. Since 2016 the database has tracked more than 140 P3 bills from dozens of states. Like existing P3 statutes, these pieces of legislation range from broad comprehensive enabling statutes creating new P3 authority in a state to minor or substantial tweaks to existing state P3 authority. 

Below are the 20 P3-related bills enacted by 14 states since 2016.

Table 1 - P3 - Related Bills

State

Bill

Topic

Category

       

Arkansas

SB 651 (2017)

Broad enabling legislation

New P3 Enabling

California

SB 562 (2016)

New project-specific P3 authorization

New P3 Enabling

Florida

SB 124 (2016)

Amended existing authorization; expanded qualified project definition and provided a framework for unsolicited proposals

Amends Existing P3 Authority

 

SB 126 (2016)

Amended existing authorization; involved public record requirements for unsolicited proposals

Amends Existing P3 Authority

 

HB 7027 (2016)

Amended existing authorization; expanded oversight requirements for P3s

Amends Existing P3 Authority

Indiana

SB 309 (2016)

Amended existing authorization; expanded P3 projects to include communications system infrastructure

Amends Existing P3 Authority

Kentucky

HB 309 (2016)

Broad enabling legislation

New P3 Enabling

Louisiana

SB 195 (2016)

Amended existing authorization; expanded which state agencies are permitted to enter into P3s

Amends Existing P3 Authority

Nevada

SB 448 (2017)

Amended existing authorizations; impacts P3 authority for certain large counties

Amends Existing P3 Authority

New Hampshire

SB 88 (2016)

Established P3 study committee

Other

SB 549 (2016)

Established P3 Infrastructure Oversight Commission

Other

HB 2018 (2018)

Provided funds to the P3 Infrastructure Oversight Commission

Other

New Jersey

SB 865 (2018)

Broad enabling legislation

New P3 Enabling

Oklahoma

SB 430 (2017)

Broad enabling legislation

New P3 Enabling

HB 1534 (2017)

Broad enabling legislation

New P3 Enabling

Tennessee

SB 2093 (2016)

Broad enabling legislation

New P3 Enabling

Utah

SB 139 (2018)

Amended existing authorization; provided framework for unsolicited proposals

Amends Existing P3 Authority

Vermont

HB 917 (2018)

Established P3 Pilot Program

New P3 Enabling; Other

Virginia

SB 1322 (2017)

Amended existing authorization; established new oversight procedures and confirmation of public benefit

Amends Existing P3 Authority

HB 2244 (2017)

Amended existing authorization; established new oversight procedures and confirmation of public benefit

Amends Existing P3 Authority

New P-3 Authority

Arkansas | Senate Bill 651 (2017)

Created Ark. Stat. Ann. §§22-10-101 et seq.

This legislation created a broad, comprehensive P3 enabling statute. The new act allows for a public entity (i.e. an agency or instrumentality of the state, including without limitation a department, an agency, an institution of higher education, a board, or a commission) to enter into a P3 contract with a private entity for the development, design, building and/or financing of a qualified infrastructure project. Key provisions of the enabling statutes include:

  • Qualified project definition includes a wide range of both transportation and non-transportation infrastructure, including toll roads and mass transit facilities. However, the chapter does not apply to projects of the Arkansas State Highway and Transportation Department (§22-10-103[10] & 105)
  • Allows for solicited proposals only (§22-10-203 & 103[11])
  • Review and approval process; Arkansas Economic Development Commission and public hearing requirements (§22-10-501) and reporting to executive and legislative bodies (§22-10-505)
  • Comprehensive agreement guidelines (§22-10-301 & 303 & 502)
  • P3 process rulemaking and guidance granted to the Arkansas Economic Development Commission (§22-10-502)
    • Review and approval guidelines (§22-19-503)
    • Requires value-for-money analysis (§22-10-503[7])
    • Financing and revenue guidelines (§22-19-502[D])

Kentucky House Bill 309 (2016)

Amended Ky. Rev. Stat. §175B.005 to §175B.045, §175B.095, §45A.030, §45A.075, and §65.025; and created §175B.037 §45A.077, and §65.028.

This legislation created broad, comprehensive statutory authority for the state and localities to enter into P3 contracts for a range of infrastructure projects. A public entity may enter into a P3 contract for construction and financing. Key provisions of the enabling statutes include:

  • Permitted project types and enabled public entities (§45A.030)
  • Permits solicited and unsolicited proposals (§45A.007[11])
  • Requires legislative authorization for certain projects (§45A.007[8])
  • Financial plan requirements (§175B.030, §175B.035 and §175B.037)
  • Evaluation criteria (§65.028)
  • Enables tolled P3 deals with some exceptions (§175B.040) 

New Jersey  | Senate Bill 865 (2018)

Created N.J. Rec. Stat. §52:34-26, §52:18A-260, §18A:64-85, §18A:18A-60 and §40A:11-52.

This legislation permitted state government entities to enter into P3 agreements for the construction, reconstruction, repair, alteration, improvement, extension, operation and maintenance of a building or highway. Key provisions of the enabling statutes include:

  • Authority for state agencies to enter into P3s (§52:34-26)

    • Project threshold of $100 million (§52:34-26[a]), total concurrent projects limited to eight (§52:34-26[b][4])

    • Revenue producing projects permitted; lease agreements permitted but capped at 30 years for public buildings and 50 years for highways (§52:34-26[b][2])

    • Project bundling prohibited (§52:34-26[b][3])

    • Finding of public value required and public hearings required (§52:34-26[f])

    • Allows for solicited and unsolicited proposals (§52:34-26[j][4])

    • State Treasurer approval required and guidelines for establishing feasibility (§52:34-26[f][3-4])

    • Concessionaire standards and New Jersey Prevailing Wage act enforcement (§52:34-26[d])

    • Establishment of Public-Private Partnership Review Fund, a public entity shall remit one percent of the portion of the revenue established under the agreement (§52:18A-260)

Further local governments, school districts, and state colleges are permitted to use P3s for certain projects.

  • Authority for public schools to enter into P3s (§18A:18A-60)
  • Authority for state colleges to enter into P3s (§18A:64-85)
  • Authority for counties and municipalities to enter into P3s (§§40A:11-52)

Vermont  | House Bill 917 (2018)
Created Vt. Stat. Ann. tit. 19, §§2611 et seq.

This legislation created a pilot program allowing the Agency of Transportation to enter into P3 contracts for the financing, development, operation, management, ownership, leasing or maintenance of transportation infrastructure within the agency’s jurisdiction or eligible for federal-aid funding managed through the agency. Key provisions of the enabling statutes include:

  • Allows solicited and unsolicited proposals (§2611[a][1] & §2613)
  • Pilot project will sunset on July 1, 2023 (§2613)
  • Requires legislative review of the pilot program for determination of how to extend, terminate or amend the program (§2611[b])
  • Requires legislative approval of some individual projects if they have not been approved in the most recently adopted Transportation Program or total estimated state funding over the lifetime of the project will be $2 million or more. (§2613[b] & §2614) 
  • Requires report to legislatures (§2615)

Amends Existing P-3 Authority

The following examples of enacted legislation are from states with existing enabling legislation for P3s. To view details on existing P3 enabling statutes, visit NCSL’s Public-Private Partnerships for Transportation: Categorization and Analysis of State Statutes, and to view a discussion on the expansion of existing authority beyond the transportation sector, visit NCSL’s P3 Infrastructure Delivery: Principles for State Legislatures.

California | Click here to view details on California’s P3 statutory authority prior this enactment.
Senate Bill 562 (2016)
Created Cal. Gov. Code §§5975 et seq.

This project-specific legislation enables the City of Long Beach to use P3 procurement for the redevelopment of the Long Beach Civic Center. The public facilities permitted to be revitalized under the plan include a new city hall, port headquarters, public library and public park. Non-public infrastructure such as residential, retail, hospitality, institutional and industrial facilities are permitted as well.
The law enables the use of P3 models to design, build and finance a project. The legislation further includes provisions related to the negotiation and evaluation process, termination, public records, environmental standards, public ownership, and debt-financing limitations.

Florida | Click here to view details on Florida’s P3 statutory authority prior these enactments.
Senate Bill 124 (2016)
Amended and renumbered Fla. Stat. Ann. §287.05712 to §255.065 and amended §287.0935

According to the bill’s fiscal impact statement, many of the provisions implemented by this bill were recommendations from the Partnership for Public Facilities and Infrastructure Act Guidelines Task Force. The legislation primarily implemented two changes. First, the definition of qualified projects was expanded to reflect the addition of special districts and school districts as authorized entities allowed to enter into a P3 contract. Second, it created a framework and procedural guidelines for accepting unsolicited proposals for P3 procurement of infrastructure projects. 

Senate Bill 126 (2016) 
Amended and renumbered Fla. Stat. Ann. §287.05712 to §255.065

This bill created a new subsection within the existing P3 enabling statutes to provide temporary exemptions from public record and public meeting requirements for certain unsolicited P3 proposals.
House Bill 7027 (2016)
Amended Fla. Stat. Ann. §334.30 (as related to P3s)

Among various transportation appropriation provisions, this legislation altered the process of developing and approving P3 projects. Specifically, the state DOT is now required to consult with the Division of Bond Finance of the State Board of Administration on P3 projects. Subsequently, the division is permitted to make an independent project recommendation to the governor.

Indiana | Click here to view details on Indiana’s P3 statutory authority prior this enactment. 
Senate Bill 309 (2016)
Amended Ind. Code Ann. §8-15.5-1-2

The legislation, in addition to unrelated tax provisions, established the authority to enter into P3 contracts for communications systems infrastructure following the same authority and provisions currently applicable to the Indiana Finance Authorities’ P3 process.

Louisiana | Click here to view details on Louisiana’s P3 statutory authority prior this enactment.
Senate Bill 195 (2016)
Amended LA. Rev. Stat. Ann. §38:2318.1 and enacted §48:250.4

This legislation authorizes the Department of Transportation and Development (DTOD) to enter into P3 contracts for transportation facilities. Approval by the House and Senate transportation, highways, and public works committees is required prior to soliciting proposals for P3s. Key provisions of the enabling statutes include:

  • 25 percent of P3 projects must be located outside urban areas and such projects will be subject to approval by the House and Senate committee on agriculture, forestry, aquaculture and rural development (§250.4[B.1])
  • Unsolicited proposals are not permitted (§250.4[C])

Prior to passage of this bill, state law permitted the Louisiana Transportation Authority to enter into P3s. This bill expanded that authority to the DTOD.

Nevada | Click here to view details on Nevada’s P3 statutory authority prior this enactment.
Senate Bill 448 (2017)

This bill amends Nev. Rev. Stat. §§338.161 to 168 and creates Nev. Rev. Stat. §§338.158 to 338.1602, expanding on and clarifying Nevada’s current but limited P3 enabling statutes for counties whose population exceeds 700,000. Currently, this bill will only impact Clark County due to this population threshold. Key provisions of the enabling statutes include:

  • Permitted project types and enabled public entities (§338.1587, §338.1583 & §338.1584)
  • Procurement methods and proposal evaluation (§338.1588)
  • Permits unsolicited proposals, guidelines for submissions (§§338.159 to 338.1593)
  • Financing, state/federal credit assistance and project revenue guidelines (§§338.1594 to 338.1599)
  • Use of user fees (§338.1597)

Utah | Click here to view details on Utah’s P3 statutory authority prior this enactment.
Senate Bill 139 (2018)
Amended Utah Code Ann. §§63G-2-305, 63G-6a-1-3, and §63G-6a-712

This legislation created a process for accepting and reviewing unsolicited proposals for P3 projects (§63G-6a-712) and made conforming changes throughout the existing P3 statutes. Specifically, the unsolicited process framework includes requirements for unsolicited proposals, a framework for considering and evaluating such proposals, and parameters for awarding contracts under unsolicited proposals. 

This legislation created a process for accepting and reviewing unsolicited proposals for P3 projects (§63G-6a-712) and made conforming changes throughout the existing P3 statutes. Specifically, the unsolicited process framework includes requirements for unsolicited proposals, a framework for considering and evaluating such proposals, and parameters for awarding contracts under unsolicited proposals. 

Virginia | Click here to view details on Virginia’s P3 statutory authority prior these enactments.
Senate Bill 1322 & House Bill 2244 (2017), identical
Created Va. Code §33.2-1803.1:1 and amended §§ 33.2-1801, 33.2-1803, 33.2-1803.1, 33.2-1803.2, and 33.2-1809.

This legislation amends the current enabling P3 statutes by implementing new policies and procedures related to ensuring the public benefit of P3 projects and revising the executive and legislative branch oversight of the P3 approval process. As amended, the current statutes require, throughout the life of a project, that efforts be made to ensure the public benefit continues to exist. Key components of the legislation include:

  • Established the Transportation Public-Private Steering Committee (§33.2-1803.2) and requires it:
    • To determine that the project serves the best interest of the public;
    • Produce, prior to the invitation of a procurement:
      • A comparison of benefits of various types of procurement.
      • A statement of risks, liabilities and responsibilities to be assigned to the concessionaire.
      • A determination of the delivery risk level associated with the project.
      • A description of how the public interest will be maintained through the transfer of risk.
      • A rationale demonstrating the benefits of pursuing a P3 compared to traditional procurement.
    • To reconfirm the finding of public interest prior to entering into a comprehensive agreement (assuring no change during the bidding process).
  • Creation of procedures for an interim agreement (§33.2-1809)

Other

New Hampshire | Senate Bill 88 (2015)
Established a committee to study public-private partnerships for intermodal transportation. Established the committee size and member appointment process and required a report be issued by Jan. 1, 2016.

Senate Bill 549 (2016)
Create N.H. Rev. Stat. Ann. §§228:107 et seq.

This bill established the Public-Private Partnerships Infrastructure Oversight Commission to consider and recommend potential transportation P3 projects and serve as an advisory board during a P3 contract execution. Key provisions of the enabling statutes include:

  • Establishes commission membership guidelines (§228:108)
  • Establishes duties of the commission (§228:109) which include:
    • Establish a general framework for P3 contracts.
    • Allow for solicited and unsolicited proposals and establish a process for evaluating unsolicited proposals.
    • Analyze P3 proposals.
    • Public meeting requirements.
    • Reporting requirements for commission regarding each P3 contract request. 
    • Governor approval required.
  • Commission report to legislature required (§228:111)
  • P3 projects must be approved as part of the 10-year transportation plan (§228:21[III] & §228:114).

House Bill 2018 (2018) 

Designates $100,000 of turnpike funds to be used by the public-private partnership infrastructure oversight commission for consulting services. Specifically, for the consideration and development of P3 proposals to improve the turnpike system (§358:11).

Additional Resources

Acknowledgments

This research and webpage were developed by NCSL with support from the Build America Transportation Investment Center (BATIC) Institute: An AASHTO Center for Excellence. As part of NCSL’s ongoing work to help state legislatures analyze the options available relative to transportation funding and financing, NCSL partners with the BATIC Institute to increase legislator and legislative staff capacity on these topics through in-person training, online interactive resources and written research products.

The BATIC Institute enhances taxpayer value from transportation investment by promoting public sector capacity building in the analysis, understanding, and use of project finance techniques through a program of training, sharing of best practices, and technical assistance to all state Departments of Transportation and their local partner agencies.

This research is intended to serve as an update to the January 2016 NCSL report Public-Private Partnerships for Transportation: Categorization and Analysis of State Statutes, as well as other existing NCSL P3 reports as notated within this webpage.