Source: https://www.wiggin.com/publications/connecticut-legislation-authorizes-state-public-private-partnership-agreements/
Timestamp: 2019-04-18 22:57:56+00:00

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The Act makes Connecticut one of several states to take legislative action to promote P3s as a way of addressing the country's need to upgrade and modernize infrastructure. A P3 arrangement permits public and private entities to allocate and share the risks and rewards in the delivery of the service and/or facility. Proponents of P3s cite increased efficiency and innovation, access to additional capital, reduced cost and the ability to shift risks, such as cost overruns to the private entities. Critics of P3s point to weak accountability on the part of the private entities, the potential for job elimination and the distribution of otherwise public revenues to private entities. The Act endeavors to address concerns on both sides, delineating a process for approval of the private entities and each project, as well as mandating specific contract terms and remedies in the event of a material default by the private entity contractor.
The Governor has ultimate approval of the P3s authorized by this Act, and his approval may not be given unless he determines that the project will result in job creation and economic growth. He is to approve no more than five projects by January 1, 2015. As required by the Act, the Governor submitted an initial report to the legislature on January 15, 2013 on the status of P3s authorized by the Act.
Step One: Agency Analysis. The agency must analyze all P3 proposals pursuant to the requirements set forth in Conn. Gen. Stat. §§ 4-256 through 258.
Step Two: Consultation. The agency consults with the construction services, DECD and Department of Transportation commissioners, the State Treasurer, and the Office of Policy and Management ("OPM") Secretary.
Step Three: Submission. The agency submits the P3 proposal to the governor and to the Finance, Revenue and Bonding Appropriations committees of the General Assembly, subject to public hearing requirements.
Step Four: Governor Review. The governor must find that the project will "result in job creation and economic growth" in order to approve the P3 project. Conn. Gen. Stat. § 4-256(a).
Upon approval of any project, the Governor must notify the agency and include the project in the annual P3 status report to the legislature, a report required under the statute.
Governor Malloy recently released the first status report required under the Act, identifying several possible P3 project candidates. These projects were identified as meriting further analysis by OPM and a consulting team engaged to provide legal, financial and technical advice with respect to P3 opportunities. The proposed projects were evaluated against the standards set forth in the Act, with a focus on the likelihood of success of the project as measured by potential investor interest, private sector industry expertise, and market depth (e.g. critical mass of qualified bidders). OPM and the consultant team rated the viability of the proposed projects: high probability projects represent some of Connecticut's most viable P3 initiatives; moderate probability projects while potentially viable present some legal or investor hurdles. This list is not exhaustive, however, and Connecticut may consider the feasibility of other eligible P3 projects. Going forward, the OPM, the joint venture and appropriate state agencies will coordinate the agency-level review of the most viable project candidates.
Renovation, reconstruction and operations of a State-Financed and Owned Affordable Housing Portfolio (moderate probability).
The analytic framework presented in the report will guide future evaluations of P3 projects proposed by state agencies prior to final mandated review by the legislature and the Governor.
 Public Act No. 11-1, now codified at Conn. Gen. Stat. § 4-255.
 The Act provides that a "facility" is "any public works or transportation project that generates revenue as a function of its operation." Conn. Gen. Stat. § 4-255(a)(7). The definition of "public-private partnership" includes the requirement that the revenue generated, in combination with other funding sources, must be sufficient to fund the cost of the project with state support capped at 25% of the project cost. Conn. Gen. Stat. § 4-255(a)(3).
 Conn. Gen. Stat. § 4-255(c)(1) – (3).
 Conn. Gen. Stat. § 4-256(b)(1) – (10).
 Conn. Gen. Stat. § 4-257.
 Conn. Gen. Stat. § 4-258.
 Conn. Gen. Stat. § 4-262.
 Aside from the requirements set forth above, the project must also comply with the cost-benefit and business case requirements for privatization contracts set forth in Conn. Gen. Stat. §§ 4-261(c) and 4e-16(a).
 Status Report: Preliminary Evaluation of Potential Public Private Partnership Opportunities Pursuant to Public Act No. 11-1, October Special Session, State of Connecticut Office of Governor Dannel P. Malloy (2013).

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