Examining Public-Private Partnerships for Texas Universities
This content delves into the theory and implementation of Public-Private Partnerships (P3) in the context of Texas universities. It covers the benefits, processes, and lifecycle analysis of P3 projects, providing insights into how these collaborations can enhance infrastructure development. Key topics include procurement models, risk management, innovation promotion, cost reduction, and efficient project delivery.
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Presentation Transcript
Evaluating Public Evaluating Public- -Private Partnerships Private Partnerships For Texas Universities For Texas Universities University of Texas System Real Estate Conference January 22, 2020 Jeff Nydegger Winstead PC jnydegger@winstead.com 512.370.2836
Understanding Public Understanding Public- -Private Partnerships Private Partnerships DESIGN CONSTRUCTION A public-private partnership is a procurement model that uses an integrated approach to deliver infrastructure, incorporating design, construction, financing, operations and maintenance functions into the contract. FINANCING MAINTENANCE - The Association for the Improvement of American Infrastructure (AIAI) (https://aiai-infra.Info/resource-center) OPERATION 2
The Theory of P3 The Theory of P3 DESIGN CONSTRUCTION A P3 is an alternative procurement model designed to effectively manage risk, promote innovation, reduce costs, and accelerate delivery. FINANCING MAINTENANCE OPERATION 3
The Theory of P3 The Theory of P3 4
The Theory of P3 The Theory of P3 LIFE-CYCLE COST ANALYSIS DBFOM Traditional O&M 100 90 80 70 60 Value 50 40 30 20 10 0 0 5 10 15 20 25 30 35 40 Time (Years) 5
The P3 Roadmap The P3 Roadmap Identify Objectives Engage Advisors Develop Concept Refine and Clarify Solicitation (RFQ/P) Finalize Scope Feasibility Binding Agreement Exclusive Negotiations Evaluate Responses Shortlist & Selection 6
The P3 Roadmap The P3 Roadmap Identify Objectives Identify Objectives Preparing the Solicitation Preparing the Solicitation Selection & Negotiation Selection & Negotiation 7
Identify Objectives Identify Objectives Private funding Private funding Expedited delivery Expedited delivery Risk allocation & cost certainty Risk allocation & cost certainty Efficiency & life Efficiency & life- -cycle management Mixed use; revenue generation Mixed use; revenue generation cycle management 8
Preparing the Solicitation Preparing the Solicitation Preliminary feasibility analysis Preliminary feasibility analysis Engage with private sector Engage with private sector Refined scope Refined scope Realistic timelines Realistic timelines Objective evaluation criteria Allow for creativity and innovation Allow for creativity and innovation 9
Evaluation, Selection & Negotiation Evaluation, Selection & Negotiation Transparency and communication Transparency and communication Best value selection Best value selection Recognize your partner s role Recognize your partner s role Be mindful of key milestones Be mindful of key milestones Don t lose sight of objectives Don t lose sight of objectives 10
The P3 Landscape in Texas The P3 Landscape in Texas State Procurement Laws applicable to Universities Chapter 2269 Chapter 2269 Design Chapter 2254 Chapter 2254 Professional & Consulting Services Professional & Consulting Services Chapter 2267, 2268 Chapter 2267, 2268 Pub. & Priv. Facilities & Infrastructure Act Pub. & Priv. Facilities & Infrastructure Act Design- -Build, CMR Build, CMR 11
The P3 Landscape in Texas The P3 Landscape in Texas Public & Private Facilities & Infrastructure Act (2267, 2268) No unsolicited proposals No unsolicited proposals Requires public hearings Requires public hearings Must adopt guidelines Must adopt guidelines Cumbersome comprehensive agreement requirements Cumbersome comprehensive agreement requirements 12
The P3 Landscape in Texas The P3 Landscape in Texas Constitutional Limitations: Art. 3, Sec. 52(a) No political subdivision of the State may lend its credit or grant public money or give any thing of value to any individual, association, or corporation whatsoever. The action must be within the agency s powers, not merely to benefit the public in The action must be within the agency s powers, not merely to benefit the public in general. Tex. general. Tex. Att y Att y Gen. Op. No. KP Gen. Op. No. KP- -0035 (2015). 0035 (2015). An An action may incidentally benefit a private interest and also serve a constitutional action may incidentally benefit a private interest and also serve a constitutional public purpose. Edgewood public purpose. Edgewood Indep Indep. Sch. Dist. v. . Sch. Dist. v. Meno Meno, 917 S.W.2d 717, 750 (Tex. 1995). , 917 S.W.2d 717, 750 (Tex. 1995). Whether an action serves a public purpose is for the governing body Whether an action serves a public purpose is for the governing body to to judicial review for abuse of discretion (very low standard). to judicial review for abuse of discretion (very low standard). to decide, subject decide, subject 13
The P3 Landscape in Texas The P3 Landscape in Texas Ground lease model considerations Procurement requirements Procurement requirements Ad valorem Ad valorem taxation taxation public ownership & public benefit public ownership & public benefit Sales and use tax Sales and use tax primary use & benefit primary use & benefit Public works contracts Public works contracts 14
Discussion Discussion University of Texas System Real Estate Conference January 22, 2020 Jeff Nydegger Winstead PC jnydegger@winstead.com 512.370.2836
