NEW P3 LEGISLATIONNEW P3 LEGISLATIONFEFPA CONFERENCE FEFPA CONFERENCE

July 2013July 2013

Lee A. Weintraub, Esq.Lee A. Weintraub, Esq.Becker & Poliakoff, P.A.Becker & Poliakoff, P.A.

3111 Stirling Road3111 Stirling RoadFt. Lauderdale, FL 33311Ft. Lauderdale, FL 33311

954-985-4147954-985-4147lweintraub@becker-poliakoff.comlweintraub@becker-poliakoff.com

Section 287.05712 applies to any facility or project Section 287.05712 applies to any facility or project serving a public purposeserving a public purpose

““Qualifying Project” includes educational facilities or other Qualifying Project” includes educational facilities or other buildings used or to be used by public educational institutionbuildings used or to be used by public educational institution

It applies to counties, municipalities, school boards, any It applies to counties, municipalities, school boards, any other political subdivision of the state, and any public other political subdivision of the state, and any public body, corporate and politicbody, corporate and politic

Legislative findingsLegislative findings:: Need for development & maintenance of educational facilities, Need for development & maintenance of educational facilities,

not wholly satisfied by existing procurement methodsnot wholly satisfied by existing procurement methods

Inadequate resources to develop new educational facilities, Inadequate resources to develop new educational facilities, which P3 can resolvewhich P3 can resolve

Establishes the Partnership for Public Facilities and Infrastructure Establishes the Partnership for Public Facilities and Infrastructure Act Guidelines Task ForceAct Guidelines Task Force

Task force will recommend guidelines for the legislature to consider to Task force will recommend guidelines for the legislature to consider to create a uniform process for establishing P3’screate a uniform process for establishing P3’s

Including factors public entities should consider when processing Including factors public entities should consider when processing requests requests

Task force will begin meeting by August 31, 2013 to establish Task force will begin meeting by August 31, 2013 to establish procedures for the conduct of its businessprocedures for the conduct of its business

No more than two task force meetings may be held for the purpose No more than two task force meetings may be held for the purpose of taking public testimonyof taking public testimony

Task force must submit final recommendations to governor and Task force must submit final recommendations to governor and legislature by July 1, 2014legislature by July 1, 2014

Formal establishment or adoption of Formal establishment or adoption of guidelines by public entity is not required guidelines by public entity is not required for entity to request or receive P3 for entity to request or receive P3 proposalsproposals

Public entity may adopt its own guidelines Public entity may adopt its own guidelines provided they are consistent with this statuteprovided they are consistent with this statute

Procurement ProceduresProcurement Procedures

Public entity may receive unsolicited proposals Public entity may receive unsolicited proposals or may solicit proposals through traditional or may solicit proposals through traditional procurement methodsprocurement methods

Public entity may establish a reasonable Public entity may establish a reasonable application fee for unsolicited proposalsapplication fee for unsolicited proposals Fee must be sufficient to pay costs of evaluating the Fee must be sufficient to pay costs of evaluating the

proposalproposal Public entity may hire private consultants to assist in Public entity may hire private consultants to assist in

the evaluation, paid for by private entity the evaluation, paid for by private entity

Procurement ProceduresProcurement Procedures

If the public entity intends to enter into a If the public entity intends to enter into a comprehensive agreement, it must publish comprehensive agreement, it must publish notice in the Florida Administrative notice in the Florida Administrative Register and newspaper of general Register and newspaper of general circulation at least once a week for two circulation at least once a week for two weeksweeks

Procurement ProceduresProcurement ProceduresNotice must provide that the public entity has received a Notice must provide that the public entity has received a proposal and will accept other proposals for the same proposal and will accept other proposals for the same projectproject

Time frame for accepting other proposals shall be Time frame for accepting other proposals shall be determined by public entity on project by project basisdetermined by public entity on project by project basis Based upon complexity of the project and the public benefit to be Based upon complexity of the project and the public benefit to be

gained by allowing a longer or shorter period of time for gained by allowing a longer or shorter period of time for competing proposalscompeting proposals

Time frame must be at least 21 days, but no more than 120 Time frame must be at least 21 days, but no more than 120 days, after initial date of publicationdays, after initial date of publication

Copy of the notice must be mailed to each local Copy of the notice must be mailed to each local government in affected areagovernment in affected area

Procurement ProceduresProcurement Procedures

Public entity is authorized to approve project Public entity is authorized to approve project if:if:

Project is in public’s best interestProject is in public’s best interest Facility is owned by public entity or ownership will be conveyed Facility is owned by public entity or ownership will be conveyed

to public entityto public entity Adequate safeguards in place to ensure additional costs or Adequate safeguards in place to ensure additional costs or

service disruptions are not imposed on public if material default service disruptions are not imposed on public if material default or cancellation of agreementor cancellation of agreement

Adequate safeguards in place to ensure capacity may be added Adequate safeguards in place to ensure capacity may be added if desired if desired

Estimated cost is reasonable in relation to similar facilitiesEstimated cost is reasonable in relation to similar facilities

Project Approval RequirementsProject Approval Requirements

Unsolicited proposal must be accompanied by Unsolicited proposal must be accompanied by following items, unless waived by public entity:following items, unless waived by public entity: Conceptual design of facility and schedule for Conceptual design of facility and schedule for

constructionconstruction Description of method by which private entity Description of method by which private entity

proposes to secure necessary property interestsproposes to secure necessary property interests Description of private entity’s general plans for Description of private entity’s general plans for

financing projectfinancing projectIncludes sources of private entity’s funds and identity of any Includes sources of private entity’s funds and identity of any dedicated revenue source or proposed debt or equity dedicated revenue source or proposed debt or equity investment on behalf of private entityinvestment on behalf of private entity

CONTENTS OF UNSOLICITED CONTENTS OF UNSOLICITED PROPOSAL (CON’T)PROPOSAL (CON’T)

Proposed user fees, lease payments or other Proposed user fees, lease payments or other service payments over term of agreementservice payments over term of agreement

Including methodology for and circumstances that Including methodology for and circumstances that would allow changes to user fees would allow changes to user fees

Project Qualification and ProcessProject Qualification and Process

After competitive bidding period has expired, After competitive bidding period has expired, public entity ranks proposals received in order of public entity ranks proposals received in order of preferencepreference Public entity may consider professional qualifications, Public entity may consider professional qualifications,

general business terms, innovative design general business terms, innovative design techniques, cost reduction terms, and finance planstechniques, cost reduction terms, and finance plans

Private entity must meet minimum standards Private entity must meet minimum standards contained in public entity’s guidelines for qualifying contained in public entity’s guidelines for qualifying professional services & contracts for traditional professional services & contracts for traditional procurement projectsprocurement projects

Project Qualification and ProcessProject Qualification and Process

Public entity may then begin negotiating Public entity may then begin negotiating with highest ranked firmwith highest ranked firm If pubic entity is not satisfied with results of If pubic entity is not satisfied with results of

negotiations, public entity may terminate negotiations, public entity may terminate negotiations and begin negotiating with negotiations and begin negotiating with second ranked firmsecond ranked firm

Public entity may reject all proposals at any Public entity may reject all proposals at any point in processpoint in process

Project Qualification and ProcessProject Qualification and Process

Public entity shall perform independent Public entity shall perform independent analysis of proposed P3 to demonstrate analysis of proposed P3 to demonstrate cost-effectiveness & overall public benefit cost-effectiveness & overall public benefit before initiating procurement process or before initiating procurement process or awarding contractawarding contract

Notice to Affected Local Notice to Affected Local JurisdictionsJurisdictions

Public entity must furnish copy of proposal to each Public entity must furnish copy of proposal to each affected local jurisdictionaffected local jurisdiction

Each affected local jurisdiction has 60 days from receipt Each affected local jurisdiction has 60 days from receipt of notice to submit written comments indicating whether of notice to submit written comments indicating whether proposed facility is incompatible with local jurisdiction’s proposed facility is incompatible with local jurisdiction’s plansplans

If affected local jurisdiction fails to respond within 60 If affected local jurisdiction fails to respond within 60 days, non-response is deemed acknowledgement that days, non-response is deemed acknowledgement that project is compatibleproject is compatible

Interim AgreementInterim Agreement

May be entered into before or in connection with May be entered into before or in connection with negotiation for comprehensive agreementnegotiation for comprehensive agreement

Interim agreement does not obligate public entity to enter Interim agreement does not obligate public entity to enter into comprehensive agreementinto comprehensive agreement

Interim agreement is discretionaryInterim agreement is discretionary

Parties may proceed directly to comprehensive agreementParties may proceed directly to comprehensive agreement

Interim AgreementInterim Agreement

Interim Agreement must be limited to provisions Interim Agreement must be limited to provisions that authorize private entity to commence that authorize private entity to commence activities for which it may be compensated activities for which it may be compensated related to the projectrelated to the project

Including project planning and development, design, Including project planning and development, design, environmental analysis & mitigation, survey, ascertaining environmental analysis & mitigation, survey, ascertaining availability of financingavailability of financing

Establish process & timing for negotiation of comprehensive Establish process & timing for negotiation of comprehensive agreementagreement

Such other provisions the parties deem appropriateSuch other provisions the parties deem appropriate

Comprehensive AgreementComprehensive Agreement

MustMust provide for: provide for:

Payment and performance bonds Payment and performance bonds

Public entity’s review and approval of project designPublic entity’s review and approval of project designDoes not require private entity to complete the design before Does not require private entity to complete the design before executing comprehensive agreementexecuting comprehensive agreement

Public entity’s inspection of construction activitiesPublic entity’s inspection of construction activities

Public liability insurance requirementsPublic liability insurance requirements

Public entity’s monitoring of maintenance practices by Public entity’s monitoring of maintenance practices by private entityprivate entity

Comprehensive AgreementComprehensive Agreement Periodic financial reporting by private entity pertaining Periodic financial reporting by private entity pertaining

to projectto project

Fees, lease payments, or service paymentsFees, lease payments, or service payments

Rights and responsibilities of parties during course of Rights and responsibilities of parties during course of construction and operationsconstruction and operations

Including provisions for termination of agreement & rights Including provisions for termination of agreement & rights and responsibilities upon default by private entityand responsibilities upon default by private entity

– Must provide for circumstances whereby defaulting private Must provide for circumstances whereby defaulting private entity’s responsibilities and interests may be assumed by either entity’s responsibilities and interests may be assumed by either entity participating in funding of project or public entityentity participating in funding of project or public entity

Comprehensive AgreementComprehensive Agreement

MayMay include: include:

Agreement by public entity to make grants or Agreement by public entity to make grants or loans to private entity from amounts received loans to private entity from amounts received from federal, state or local government or from federal, state or local government or agenciesagencies

Notice of default and right to cure provisionsNotice of default and right to cure provisions

Comprehensive AgreementComprehensive Agreement

Private entity will receive revenues from Private entity will receive revenues from fee-generating uses of facility over life of fee-generating uses of facility over life of agreementagreement

Pre-negotiated portion of same must be Pre-negotiated portion of same must be returned to public entityreturned to public entity

FinancingFinancingPrivate entity may enter into private source financing Private entity may enter into private source financing agreement with financing sourcesagreement with financing sources Financing agreement obligations and liens on property must be Financing agreement obligations and liens on property must be

paid in full before transfer of ownership or operation of facility to paid in full before transfer of ownership or operation of facility to public entitypublic entity

Public entity may provide its own capital or operating Public entity may provide its own capital or operating budget to support projectbudget to support project Budget must be from any legally permissible funding source of Budget must be from any legally permissible funding source of

public entitypublic entity

Financing agreement may not require public entity to indemnify Financing agreement may not require public entity to indemnify financing source, subject public entity’s facility to liens, or pledge financing source, subject public entity’s facility to liens, or pledge security interestsecurity interest

Any such provision in financing agreement is void as matter Any such provision in financing agreement is void as matter of lawof law

FinancingFinancing

Public entity shall appropriate contractual Public entity shall appropriate contractual payment obligation, if required by payment obligation, if required by comprehensive agreement, on priority comprehensive agreement, on priority basisbasis Payment obligation must be appropriated Payment obligation must be appropriated

before other non-contractual obligations before other non-contractual obligations payable from same enterprise or government payable from same enterprise or government fundfund

Expiration or Termination of Expiration or Termination of AgreementsAgreements

If private entity materially defaults, compensation If private entity materially defaults, compensation otherwise due to private entity would be payable otherwise due to private entity would be payable to investors & lenders on job as provided in any to investors & lenders on job as provided in any operative agreementoperative agreement

Provided costs of operating and maintaining facility are paid in Provided costs of operating and maintaining facility are paid in the normal coursethe normal course

Public entity’s assumption of development or operation of project Public entity’s assumption of development or operation of project does not obligate it to pay any obligation of private entity from does not obligate it to pay any obligation of private entity from sources other than revenues from the project unless stated sources other than revenues from the project unless stated otherwise in comprehensive agreementotherwise in comprehensive agreement

Sovereign immunity is not waivedSovereign immunity is not waived

Doesn’t waive any requirement of s. Doesn’t waive any requirement of s. 287.055287.055

This act took effect July 1, 2013This act took effect July 1, 2013