Download Ali-Lauzon-Non-Traditional-P3-Applications

STRETCHING THE LIMITS OF P3, NONTRADITIONAL APPLICATIONS
ARTBA’s 28th Annual P3s in Transportation
Conference
Alexandra J. Lauzon
July 15, 2016
Key Policy Questions
The key policy questions facing state agencies and localities are
similar across different infrastructure needs and sectors.
• How do we respond to growing needs of infrastructure – renewal,
repair, development, construction?
• What is the optimal level of public sector spending on
infrastructure?
• What is the relative importance of private sector investment in
infrastructure?
• Are taxes and tax-exempt bonds as prime financing mechanisms
adequate?
• Are new roles required for different levels of government?
2
The P3 Delivery Method is a Tool
State agencies and localities can consider the P3 delivery
method as a tool when tackling key policy questions.
• Supplement traditional funding and project delivery methods
• Deliver projects quicker, especially when public entities have limits
on traditional funding sources (tax revenue or bond programs)
• Include lifecycle costs in the P3 scope (operations and maintenance)
• Share and transfer risk with a private partner
• Attract private financing to supplement public funding
• Bring private sector innovation and financial discipline to the project
3
Successful P3 Projects
are Alike
Highly Motivated Government
Sponsor
Champion the project and process
Appropriate Project
Agreement
Sustain political support through broad
stakeholder outreach and education
Clearly defined public and
Clearly Defined,
High Priority Project
Reflecting broad
private roles and
responsibilities
consensus on need and
objectives
Broadly available through a
process that balances
transparency and efficiency
Successful
P3
Advance preparation
Project Predictability
Certainty of completion
driven by broad public
and political awareness
and support
Clearly Defined,
Fair Process
including key public and
private stakeholders
Economically Viable
Clear decision-making
Policymakers’ commit predictable
roles and timetables,
communicated to key
stakeholders
revenues
Public understands
value received
in return for user fees or
availability payments
Transparent scoring and
selection of winning team4
VAP3’s Role in
Virginia’s P3 Projects
• Identify and screen potential P3 projects and concepts within the
P3 Pipeline
• Act as a resource to agencies and localities interested in a potential
P3 project - champion, catalyst, and guide
• Facilitate the development of P3 projects - pragmatic and
collaborative project managers
• Develop consistent and fair P3 procurement and project
development processes – guidelines facilitate closure
• Evaluate the P3 project technical and financial feasibility - focus on
best value and public benefits
• Educate and communicate the role of P3’s in program and project
development - steady flows of information
5
VAP3’s P3 Project
Delivery Framework
Project Identification
Project Screening
High-Level
Screening
Detail-Level
Screening
Project Development
Project Procurement
Comprehensive Agreement Executed
RPE Implements/
VAP3 Supports
6
Solar Energy
Development Project
• VAP3 is working in collaboration with the Virginia Department of
Mines, Minerals, and Energy (DMME)
• The project purpose is to:
– advance the Governor’s renewable energy goals
– identifying opportunities to optimize the use of state-owned assets
– diversify Virginia’s energy mix by developing solar energy systems
• Current focus is on distributed sites (< 2 MW) where the solar power
is consumed by state facilities on site
• The Project is progressing in multiple phases:
1. “Early adopters” - three solar systems for different state agencies bundled together
2. “Second Generation” - larger number of systems combined into bundle packages
7
Solar Energy
Development Project
•
P3 delivery method
– Private partner designs, builds, finances, operates and maintains the solar
energy systems
•
Federal incentives include
– Investment Tax Credit for 30% of the total capital cost of solar energy systems
– Modified Accelerated Cost-Recovery System accelerating system depreciation
over a five-year period
– Private partner could take advantage of incentives in its financing structure
•
DMME Clean Energy Development and Services Program
– Repurposed of U.S. Department of Energy American Recovery and
Reinvestment Act State Energy Program funding
– May be used as public subsidy to offset the cost of the project and ensure the
agencies pay no more than what they currently pay for electricity
8
Commerce Road Corridor
Redevelopment Project
• Joint effort to restore economic
vitality to the corridor – Port of
Virginia, City of Richmond and
VAP3
• Capitalize on the Port of Virginia’s
40-year lease with the City of
Richmond
• Leverage the benefits of the
Richmond Marine Terminal
• Identify potential redevelopment
strategies that effectively
leverage public resources to
attract private investment
9
Commerce Road Corridor
Redevelopment Project
• Utilize the P3 Project Delivery Framework to evaluate the project
opportunity and develop a roadmap for project development
• Facilitate communication and collaboration with the key stakeholders
• Coordinate with potential public and private partners to better
understand the project potential
• Detail-Level Screening executed by the Port of Virginia on July 8, 2016
• Currently, the project is transitioning into development and moving
forward with the two key recommendations in the Detail-Level
Screening Report:
1.
Formally assembling the Project Team and governance structure; and then
2.
Taking the steps necessary to advance through the development process
10
Air Rights Project
• VAP3 is working in collaboration with VDOT and Arlington County
• The project purpose is to explore ways to maximize value of existing
public assets by making selected Air Rights over I-66 available for
development in and around transportation facilities
• Values generated in the form of revenues or benefits could be in
the range of $15 to $25 million per site.
VDOT Cell Tower Project
• Rapid changes underway in telecom, growth in demand for data,
and non-traditional players are driving changes in cell tower
industry
• The project purpose is to:
– Capitalize on the opportunity presented by the rapid changes in
the telecom industry
– Grow the VDOT cell tower program to boost revenue from noncore assets
– Harness private sector market understanding for locating,
operating and maintaining cell towers
• VDOT, with VAP3 assistance, is currently developing an RFI:
– The intent is to initiate engagement with private sector to clarify
opportunities ahead and suggest changes needed to attract
investment, share risks, and increase revenue
12
Current Pipeline of P3 Projects
Candidate P3 Projects:
Conceptual P3 Projects:
• Hampton Roads Crossing
Improvements
• Route 460 / 58 Connector
• Interstate Lighting
• Advertising / Sponsorship
Opportunities
• New DMV Customer Service
Facilities
• Toll Credit Program
• Regional Airport runway
maintenance
• Existing Park Facilities
enhancements
• New Park & Ride Facilities
• Rest Area Truck
Enhancements
• Biofuel energy development
• Availability Payment concept
• Crowdfunding concept
• Design-Build Finance
concept
• Broadband within Right of
Way
THANK YOU
Virginia Office of Public-Private Partnerships
Alexandra J. Lauzon, Deputy Project Manager
[email protected]
www.p3virginia.org
facebook.com/p3virginia
twitter.com/p3virginia
linkedin.com/virginia-office-of-public-private-partnerships
14