Source: http://bpp.worldbank.org/en/data/exploreeconomies/united-states/2017
Timestamp: 2019-04-19 06:58:41+00:00

Document:
The United States is a federation of states, with the U.S. federal government and the government of each state regulating PPPs in a specific manner. This analysis will be focused on the state of Virginia (also known as the Commonwealth of Virginia), which established a framework for PPPs in some sectors. Considering the study's scope - a transportation project -, this study will be based on the transportation sector. In 1988, Virginia enacted the Virginia Highway Corporation Act (Va. Code Ann. § 56-535 et seq). This was followed by the Public-Private Transportation Act of 1995 ("PPTA"), now codified (Va. Code Ann. § 33.2-1800 through Va. Code Ann. § 33.2-1824). The 2014 Virginia PPTA Implementation Manual and Guidelines (Manual and Guidelines) provides an updated project delivery framework which identifies, evaluates, develops and delivers Virginia's public-private partnership (P3) transportation projects (currently being updated) are the 1) September 2016 P3 Value for Money Guidelines, developed to provide guidance to the VDOT Office of Public-Private Partnerships (VDOT's P3 Office) and Responsible Public Entities (RPEs) with the preparation of a value for money comparison of potential project delivery options; 2) the September 2015 P3 Risk Management Guidelines which provides a Risk Management Framework, and serves as a guide for managing various risks throughout the entire lifecycle from the initial screening to handback at the end of the contract term; 3) the August 2015 P3 Public Engagement Guidelines which enhance transparency, and identifies and explains opportunities for public engagement of citizens and key stakeholders throughout the various phases of the P3 process. Together these documents are governing guidelines for solicitation, evaluation, award, and delivery of P3 projects procured under the Public-Private Transportation Act of 1995, as amended, (PPTA) in the Commonwealth.
The United States is a federation of states, with the U.S. federal government and the government of each state regulating PPPs in a specific manner. This analysis will be focused on the state of Virginia (also known as the Commonwealth of Virginia), which established a framework for PPPs in some sectors. Considering the study's scope - a transportation project -, this study will be based on the transportation sector. In 1988, Virginia enacted the Virginia Highway Corporation Act (Va. Code Ann. § 56-535 et seq). This was followed by the Public-Private Transportation Act of 1995 ("PPTA"), now codified (Va. Code Ann. § 33.2-1800 through Va. Code Ann. § 33.2-1824).
3) the August 2015 P3 Public Engagement Guidelines which enhance transparency, and identifies and explains opportunities for public engagement of citizens and key stakeholders throughout the various phases of the P3 process.
Together these documents are governing guidelines for solicitation, evaluation, award, and delivery of P3 projects procured under the Public-Private Transportation Act of 1995, as amended, (PPTA) in the Commonwealth.
Virginia SB 1322 - Amends the PPTA. Renames the "Advisory Committee" the Transportation Public-Private Partnership "Steering Committee" and provides that the Deputy Secretary of Transportation shall serve as the chairman of the Steering Committee. Under the PPTA as amended, a responsible public entity ("RPE") may grant approval for the development and/or operation of a transportation facility by a private entity if that private entity can develop and/or operate the transportation facility for less cost than the Department of Transportation ("VDOT") or the Department of Rail and Public Transportation ("DRPT"). The law requires the chief executive officer of the RPE to certify in writing to the Governor and the General Assembly of Virginia that there has been no material change to the finding that a PPP is in the best interest of the public since the finding was issued and that the public contribution requested by the private entity does not exceed the maximum allowable. The law clarifies that the finding of public interest by the Steering Committee shall be made after receipt of responses to the request for qualifications and prior to the issuance of the first draft request for proposals. The law requires the RPE, when such entity is VDOT or DRPT, to ensure competition through the procurement process and develop a public sector analysis of the cost for the responsible entity to develop and/or operate the transportation facility. VDOT or DRPT and the Steering Committee must review the public sector analysis prior to the initiation of any procurement. The law adds to the information required to be included in the finding of public interest a description of the benefits expected to be realized by the RPE and a public sector analysis demonstrating that the private sector can deliver the project for less cost than the RPE. This law is identical to HB 2244. This law became effective on July 1, 2017 and is codified at Va. Code Ann. §§ 33.2-1801 et seq. See http://lis.virginia.gov/cgi-bin/legp604.exe?171+sum+SB1322.
HB 1929 - Amends the PPTA. Requires all comprehensive agreements originally entered into on or after July 1, 2017, resulting in privately funded roads open for public transportation, to include a provision requiring funding for adequate staffing, defined in the law, for general law-enforcement services by the Virginia State Police. This law became effective on July 1, 2017 and is codified at Va. Code Ann. § 33.2-1808. See http://lis.virginia.gov/cgi-bin/legp604.exe?171+sum+HB1929.
Also, the PPTA Manual is being revised effective October 2017.
Pursuant to article § 33.2-1800 of the Va. Code Ann., "Responsible public entity" means a public entity, including local governments and regional authorities, that has the power to develop and/or operate the qualifying transportation facility. Consequently, PPPs can be procured by RPE's that are state government, local government, or an established authority.
For transportation projects, the Transportation Public-Private Partnership Advisory Committee must review and certify that a proposed PPP transportation project serves a "public interest" before procurement can be initiated. See, Va. Code § 33.2-1803.2.
The VAP3 accepts and solicits PPP’s, but does not have the authority to accept or reject the proposals. That power lies with a mixture of other agencies/commissions and with the legislature. The VAP3 was established for administrative convenience.
For transportation P3's, Federal Highway Administration and the PPTA's Transportation Public-Private Partnership Steering Committee (the Committee); for PPPs undertaken by local governments, funding must be approved by the governing body of the locality.
If federal funds will be used, Federal Highway Administration's approval is necessary in order to enable RFP issuance and constitutes project authorization so long as the National Environmental Policy Act (NEPA) process has been satisfactorily completed. See 23 C.F.R. § 635.112(i)(1).
Furthermore, § 33.2-1803.2. A. of the code provides for the Transportation Public-Private Partnership Advisory Committee. Procurement pursuant to § 33.2-1803 shall be initiated by the Department of Transportation or the Department of Rail and Public Transportation only after the Transportation Public-Private Partnership Advisory Committee (the Committee) has determined that the development and/or operation of the transportation facility or facilities as a qualifying transportation facility serves the public interest pursuant to § 33.2-1803.1. The determination shall be evidenced by an affirmative vote of a majority of the members of the Committee.
The Virginia Department of Transportation (VDOT) assembles a four year transportation planning document called the Statewide Transportation Improvement Program (STIP), which is created from regional transportation improvement programs. The STIP includes both federally and state funded projects scheduled for some phase of implementation within the four-year period. It also serves as the reference document required by the Federal Highway Administration (FHWA) and the Federal Transit Administration (FTA) for use in approving federal funds for transportation projects in Virginia. Any PPP project seeking to use federal funds, thus, must be in the STIP.
2. The transportation facility or facilities and the proposed interconnections with existing transportation facilities, and the private entity's plans for development and/or operation of the qualifying transportation facility or facilities, are, in the opinion of the responsible public entity, reasonable and will address the needs identified in the appropriate state, regional, or local transportation plan by improving safety, reducing congestion, increasing capacity, enhancing economic efficiency, or any combination thereof.
- Does the project address the needs outlined in the local, regional and state transportation plans, such as congestion relief, safety, new capacity and preservation of existing assets?
- Does the project support improving safety, reducing congestion, increasing capacity, providing accessibility, improving pedestrian, biking facilities and/or enhancing economic efficiency?
- Are there anticipated transportation benefits to the community, the region and/or the Commonwealth?
- Is the project expected to help achieve performance, safety, mobility or transportation demand management goals?
- Is the project expected to improve connections among existing and planned transportation modes?
- Are there potential project benefits to the Affected Localities' transportation system?
- Are there anticipated enhancements to adjacent transportation facilities or other modes?
Details: The assessment is prepared before launching the procurement of a PPP.
In accordance with § 33.2-1803(F) of the code, for any project with an estimated construction cost of over $50 million, the responsible public entity also shall require the private entity to pay the costs for an independent audit of [...] all public costs and potential liabilities to which taxpayers could be exposed (including improvements to other transportation facilities that may be needed as a result of the proposal, failure by the private entity to reimburse the responsible public entity for services provided, and potential risk and liability in the event the private entity defaults on the comprehensive agreement or on bonds issued for the project). This independent audit shall be conducted by an independent consultant selected by the responsible public entity, and all such information from such review shall be fully disclosed.
3. Qualitative assessment of the cost and revenue projections relative to other, similar projects and assessment of the potential for increased costs and liabilities to the VAP3 or the RPE.
The level of audit shall be specific to the scope and type of agreement, whether Interim or Comprehensive Agreement.
Pursuant to § 33.2-1803(C) (5) of the code, the responsible public entity may determine that the development and/or operation of the transportation facility or facilities as a qualifying transportation facility serves such public purpose if the risks, liabilities, and responsibilities transferred, assigned, or assumed by the private entity provide sufficient benefits to the public to not proceed with the development and/or operation of the transportation facility through other means of procurement available to the responsible public entity.
c. Other items determined appropriate by the responsible public entity in the guidelines for this chapter.
3. The determination of whether the project has a high, medium, or low level of project delivery risk and a description of how such determination was made. If the qualifying transportation facility is determined to contain high risk, a description of how the public's interest will be protected through the transfer, assignment, or assumption of risks or responsibilities by the private entity in the event that issues arise with the development and/or operation of the qualifying transportation facility.
Finally, according to section 4.3 of the PPTA Implementation Manual, During the project development phase, the VAP3 will convene and participate in an interim risk workshop to update the project risks identified in the Detail-Level Screening and identify any additional risks.
The CV3P P3 Risk Management Guidelines (3.1.2) identifies steps for the Screening phase, which are the following : Step 1 - Create Risk Register ; Steps 2 - 4 Conduct Risk Analysis, Identify Risk Response and Identify Potential Risk Allocation ; and for the Development phase, as follows : Step 1 - Conduct Risk Analysis; Step 2 - Refresh Risk Register; Step 3 - Identify Risk Response; Step 4 - Identify Potential Risk Allocation.
According to section 4.2 of the PPTA Implementation manual, as part of the project development phase, the VAP3 will conduct an Initial VfM Analysis to determine whether a project provides more benefits to its users and to the Commonwealth when delivered through the P3 delivery process than when delivered through a traditional method.
The PPTA Value for money guidance of the Office of transportation public private partnerships provides a specific methodology to assess the value for money of a PPP project.
Relevant legal/regulatory provision (if any) Appendix E of the PPTA implementation manual requires to assess the financial feasibility of the project.
- Are there public funds required and, if so, are the Commonwealth's financial responsibilities clearly stated?
- Is the preliminary financial plan feasible in that the sources of funding and financing can reasonably be expected to be obtained?
- What is the level of private financial equity/debt within the preliminary financial plan?
Pursuant to Appendix E of the PPTA Implementation Manual, among the Detail-Level Screening Criteria is the market Demand for PPTA Delivery. However, this measure is only applicable to Solicited Projects; Unsolicited Proposals do not need to address this issue, as Private Entities are demonstrating market demand through the submission of their Proposal.
Within the Key Tasks during the Project Development Phase is Analyzing compliance with environmental and transportation planning requirements (4.1 of the PPTA Implementation Manual).
PPTA Implementation Manual (1.6): For all projects requiring federal action, the relevant RPE initiates and completes an environmental document in accordance with the National Environmental Policy Act (NEPA), prior to inviting proposals for projects. At this point, the purpose and need for the project have been well-established, alternative design concepts and scopes have been analyzed, and operational features are identified. The concepts and analyses are submitted to the public and various other stakeholders for review and comment, and, ultimately, a preferred alternative is selected and a determination such as a Categorical Exclusion (CE), Finding of No Significant Impact (FONSI), or Record of Decision (ROD) is issued by the appropriate lead federal agency.
FONSI means Finding of No Significant Impact as defined in 40 CFR 1508.13. A FONSI is issued by the lead federal agency when environmental analysis and interagency review during the environmental assessment process determines a project has no significant impacts on the environment.
NEPA process: means the statutory process to assess the environmental impacts of alternative options carried out in accordance with the requirements of the National Environmental Policy Act.
Details: Environmental assessment is a part of the prefeasibility analysis of the project.
Various assessments, such as: high and detail level screenings, policy reviews, risk registers and risk analyses, and value for money analysis would be posted, as well as the environmental impact assessment.
Contents of RFP documents are stated by Appendix G of the PPTA implementation manual and include the RPE's preferred allocation of project risks and commercial terms via a draft Comprehensive Agreement.
This includes: P3 Task Order template – P3 High-Level Screening Report template – P3 Detail-Level Screening Report template – P3 Policy Review Report template.
No specific provisions. In practice, the committee is comprised of technical experts, financial experts, and a procurement manager.
Pursuant to section 5.2.1 of the Implementation Manual and Guidelines for the PPTA, the RFQ documents will be posted on the Department of General Services central procurement website and the VDOT P3 website (www.p3virginia.org).
Pursuant to section 5.2.1 of the Implementation Manual and Guidelines for the PPTA, the RFQ documents will be posted on the Department of General Services central procurement website and the VDOT P3 Office website. These documents shall provide for a minimum 60-day competition period.
Section 5.1 of the PPTA Implementation Manual indicates: The P3 procurement process consists of (1) issuing a RFQ and (2) issuing a Request for Proposals (RFP).
Pursuant to section 5.2.1 of the Implementation Manual and Guidelines for the PPTA, the RFQ documents will be posted on the Department of General Services central procurement website and the VDOT P3 Office website. These documents shall (1) provide for a minimum 60-day competition period and (2) include information regarding the scope, nature and timing of development and/or operation of the proposed project. The public will have the opportunity to provide comments on a continuous basis by making use of the VDOT P3 Office website.
Pursuant to section 5.2.1 of the PPTA implementation manual, the RFQ documents will specify the evaluation criteria and the methodology used to evaluate such criteria so that Proposers will know how their submissions will be evaluated.
The RFQ documents will specify the evaluation criteria and the methodology used to evaluate such criteria so that Proposers will know how their submissions will be evaluated.
If yes, please specify: Practice is to disclose information requested as a clarification to all bidders.
Appendix F of the Implementation Manual: The VAP3 may arrange for a pre-Proposal conference or webinar, as deemed appropriate, to present and clarify information about the project and procurement process and respond to any questions that prospective Respondents may have about the RFQ.
Some information is disclosed as VAP3 seeks transparency. However, confidential information received from bidders is not disclosed.
According to Appendix G of the PPTA Implementation Manual, the content requirements of the Financial Proposal will vary with the type of PPTA delivery structure and the transportation mode and nature of a particular P3 project. If the RFP and project scope requires the Proposer to finance any part of the project, the RFP will require that the Financial Proposal include a financial plan and financial model. Depending upon the nature of the project, the project delivery method and current market conditions, the requirements for the contents and level of detail of the financial plan could be substantially different. The Financial Proposal may require that the Proposer update the financial qualification information provided with the SOQ. The RFP documents will include the financial plan requirements. The VAP3 will seek, where possible and financially feasible, Proposals that minimize the use of public funds as well as the creation of state-supported debt. If a Proposal including public or private debt is submitted, then the RFP will require that the Proposal identify the amount of public funds required and a plan for complying with any requirements associated with using public funds.
Pursuant to section 5.6 of the PPTA Implementation manual, the RPE Administrator will take into account the recommendation of the VAP3, the evaluation criteria and the VfM analysis when selecting a Preferred Proposer.
Pursuant to section 5.3 of the PPTA Implementation manual, if after the competitive response period, an RPE receives a single responsive submittal to its RFP, the RPE will conduct a full value assessment of the proposal received to determine if the responsive submittal brings value to the Commonwealth. The value assessment will include, at a minimum, an assessment of risk allocations and the Final VfM Analysis described in Section 5.5. Once the value assessment has been completed, the RPE will make a presentation to the RPE's Oversight Board to present the value assessment and seek a resolution from the Oversight Board to accept the responsive proposal or terminate the procurement. The RPE's presentation to the Oversight Board will be at a regularly scheduled meeting open to the public.
According to section 5.6 of the PPTA implementation manual, the VAP3, in coordination with the RPE, will notify all other Proposers in writing regarding the RPE Administrator's decision to award the project to the Preferred Proposer.
Practice is to limit negotiations as final procurements documents are subject to review and comment during the procurement process.
Pursuant to section 5.11 of the 2014 PPTA implementation manual, once the contract is finalized and a decision to award has been made, the RPE will post major business points of the CA, including any projected public funds used on the project and the signed contract on the VDOT P3 Office and/or project website.
23 U.S. Code § 106 - Project approval and oversight g.1 (A)In general.-The US Secretary of Transportation shall establish an oversight program to monitor the effective and efficient use of funds authorized to carry out this title.
(B)Minimum requirement.- At a minimum, the program shall be responsive to all areas relating to financial integrity and project delivery.
(B) the role of the agency leadership and management team in the delivery of the project.
Relevant legal/regulatory provisions (if any): The PPP Risk Management Guidelines and the PPP Risk Register address the process of a risk mitigation mechanism.
The contract management team is an established practice and not a requirement of the regulatory framework. Hence, there are no requirements for the qualification of their members.
(i)In general.- A public authority with jurisdiction over a toll facility shall conduct or have an independent auditor conduct an annual audit of toll facility records to verify adequate maintenance and compliance with subparagraph (A), and report the results of the audits to the Secretary.
(ii)Records.- On reasonable notice, the public authority shall make all records of the public authority pertaining to the toll facility available for audit by the Secretary.
Where the FHWA has designated a PPP project a "Major Project" under 23 USC § 106 (a project with a cost of $500 million or more), 23 USC § 106(h) requires submission and approval of a project management plan, a finance plan and annual updates.
23 U.S.C. § 129(a)(3)(B) requires a public authority with jurisdiction over a toll facility to conduct or have an independent auditor conduct an annual audit of toll facility records to verify adequate maintenance and compliance, and report the results of the audits to the FHWA.
Act (VUAA), as applicable, and complemented by case law.
Pursuant to § 33.2-18132 (A) of the Code, upon the occurrence and during the continuation of material default, the responsible public entity may exercise any or all of the following remedies: 2.The responsible public entity may terminate the interim or comprehensive agreement and exercise any other rights and remedies that may be available at law or in equity. Furthermore, § 33.2-1808 (8.) related to Comprehensive agreement indicates that compensation to the private entity that may include a reasonable development fee, a reasonable maximum rate of return on investment, and/or reimbursement of development expenses in the event of termination for convenience by the responsible public entity as agreed upon between the responsible public entity and the private entity.
Pursuant to § 33.2-1817 of the code, the responsible public entity shall terminate the private entity's authority and duties under this chapter on the date set forth in the interim or comprehensive agreement. Upon termination, the authority and duties of the private entity under this chapter shall cease, and the qualifying transportation facility shall be dedicated to the responsible public entity or, if the qualifying transportation facility was initially dedicated by an affected locality or public entity, to such affected locality or public entity for public use.
According to § 33.2-1820 (A) (1.) of the code, for responsible public entities that are state agencies, authorities, departments, institutions, and other units of state government, posting shall be on the Department of General Services' central electronic procurement website. For proposals submitted pursuant to subsection A of § 33.2-1803, the notice posted shall (i) provide for a period of 120 days for the submission of competing proposals; (ii) include specific information regarding the proposed nature, timing, and scope of the qualifying transportation facility; and (iii) outline the opportunities that will be provided for public comment during the review process; Furthermore, the PPTA implementation agreement provides regulations related to unsolicited proposals in section 2.2, indicating that the PPTA permits RPEs to receive and evaluate Unsolicited Proposals from Private Entities to develop and/or operate P3 projects under their jurisdiction. Private Entities may submit Unsolicited Proposals for all transportation modes to the RPE at any time, pursuant to the PPTA, the Code of Virginia (Title 62.1) and this PPTA Manual and Guidelines. All Unsolicited Proposals shall be submitted to the RPE for forwarding to the VAP3. A copy of the Unsolicited Proposal may also be mailed to the VAP3 for the attention of the VAP3 Director at the following address. In accordance with § 62.1-132.19(D) of the code, which states that "neither the Commonwealth nor the Authority (Virginia Port Authority) shall accept any unsolicited proposal under the PPTA (§ 33.2-1800 et seq.) regarding the ownership or operation of any seaport or port facility," Unsolicited Proposals regarding the ownership and/or operation of any seaport or port facility can no longer be accepted by the VPA or VAP3.
Pursuant to section 3.1.2 of the PPTA Implementation Manual and Guidelines, within 90 calendar days of receiving an Unsolicited Proposal from a Private Entity via an RPE, the VDOT P3 Office will perform a Policy Review and brief evaluation of the concept and benefits to ensure the Proposal is in accordance with the Code of Virginia and this PPTA Manual and Guidelines and is consistent with the Commonwealth's transportation policy goals. The findings of the evaluation and the VDOT P3Office's recommendations will be documented in a Policy Review Report which is submitted to the RPE Administrator.
Private Entities may submit Unsolicited Proposals to the RPE at any time pursuant to the PPTA (§ 33.2-1803) and this PPTA Manual and Guidelines. (3.1.2 of the PPTA Implementation Manual). As a consequence, the Virginia Department of Transportation (VDOT) assembles a four year transportation planning document called the Statewide Transportation Improvement Program (STIP), which is created from regional transportation improvement programs. The STIP includes both federally and state funded projects scheduled for some phase of implementation within the four-year period. It also serves as the reference document required by the Federal Highway Administration (FHWA) and the Federal Transit Administration (FTA) for use in approving federal funds for transportation projects in Virginia. Any PPP project seeking to use federal funds, thus, must be in the STIP.
Yes. Establishment of a PPP contract management team. Participation of the team in procurement. Elaboration of a PPP implementation manual. Risk mitigation mechanism.

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