LCO No. 3437 1 of 8 General Assembly Raised Bill No. 920 January Session, 2021 LCO No. 3437 Referred to Committee on TRANSPORTATION Introduced by: (TRA) AN ACT CONCERNING PU BLIC PRIVATE PARTNER SHIPS. Be it enacted by the Senate and House of Representatives in General Assembly convened: Section 1. Section 4-255 of the general statutes is repealed and the 1 following is substituted in lieu thereof (Effective October 1, 2021): 2 (a) As used in this section and sections 4-256 to 4-263, inclusive, as 3 amended by this act, unless the context indicates a different meaning: 4 (1) "State agency" or "agency" means any office, department, board, 5 council, commission, institution or other agency in the executive branch 6 of state government; [or a quasi-public agency as defined in section 1-7 120;] 8 (2) "Private entity" means any individual, corporation, general 9 partnership, limited partnership, limited liability partnership, joint 10 venture, nonprofit organization or other business entity; 11 (3) "Public-private partnership" means the relationship established 12 between a state agency and a private entity by contracting for the 13 performance of any combination of specified functions or 14 Raised Bill No. 920 LCO No. 3437 2 of 8 responsibilities to design, develop, finance, construct, operate or 15 maintain [one or more state facilities where the agency has estimated 16 that the revenue generated by such facility or facilities, in combination 17 with other previously identified funding sources, including any 18 appropriated funds, will be sufficient to fund the cost to develop, 19 maintain and operate such facility or facilities, provided state support 20 of a partnership agreement shall not exceed twenty-five per cent of the 21 cost of the] a project; 22 (4) "Partnership agreement" means an agreement executed between a 23 state agency and a private entity to establish a public-private 24 partnership; 25 (5) "Project" means a project that an agency has submitted to the 26 Governor for approval as a public-private partnership; 27 (6) "Contractor" means a private entity that has entered into a public-28 private partnership agreement with a state agency; and 29 [(7) "Facility" means any public works or transportation project used 30 as public infrastructure that generates revenue as a function of its 31 operation; and] 32 [(8)] (7) "Proposer" means a private entity submitting a competitive 33 bid in response to solicitation or a proposal in response to a request for 34 proposals for an approved project for consideration. 35 (b) Notwithstanding the provisions of section 4b-51, once the project 36 is approved by the Governor in accordance with section 4-256, as 37 amended by this act, any state agency may establish one or more public-38 private partnerships and execute a partnership agreement for a project 39 in accordance with this section and sections 4-256 to 4-263, inclusive, as 40 amended by this act. A partnership agreement may not be established 41 for the operation or maintenance of a [facility] project unless such 42 agreement also provides for the financing and development of such 43 [facility] project. 44 Raised Bill No. 920 LCO No. 3437 3 of 8 [(c) The design, development, operation or maintenance of the 45 following new or existing project types are eligible for consideration as 46 a public-private partnership if approved as a project in accordance with 47 section 4-256: 48 (1) Early childcare, educational, health or housing facilities; 49 (2) Transportation systems, including ports, transit-oriented 50 development and related infrastructure; and 51 (3) Any other kind of facility that may from time to time be 52 designated as such by an act of the General Assembly.] 53 Sec. 2. Section 4-256 of the general statutes is repealed and the 54 following is substituted in lieu thereof (Effective October 1, 2021): 55 (a) [On and after October 27, 2011, and prior to January 1, 2020, the 56 Governor shall approve not more than five projects to be implemented 57 as public-private partnership projects. The Governor shall not approve 58 any such project unless the Governor finds that the project will result in 59 job creation and economic growth.] Any agency seeking to establish a 60 public-private partnership shall, after consultation with the 61 [Commissioners of Economic and Communi ty Development,] 62 Commissioner of Administrative Services, [and Transportation,] the 63 State Treasurer and the Secretary of the Office of Policy and 64 Management, submit one or more projects to the Governor for approval. 65 The Governor shall not approve any such project unless the Governor 66 finds that the project will result in job creation and economic growth. 67 (b) In determining whether a project is suitable for a public-private 68 partnership, [agreement,] the agency shall conduct an analysis of the 69 feasibility, desirability and the convenience to the public of the project 70 and whether the project furthers the public policy goals of [section 4-71 255,] this section and sections 4-257 to 4-263, inclusive, as amended by 72 this act, taking into consideration the following, when applicable: 73 (1) The essential characteristics of the proposed [facility] project; 74 Raised Bill No. 920 LCO No. 3437 4 of 8 (2) The [projected] anticipated demand for use of the [facility] project 75 and its economic and social impact on the community and the state; 76 (3) The technical function and feasibility of the project and its 77 conformity with the state plan of conservation and development 78 adopted under chapter 297; 79 (4) The benefit to clients of the agency and the public as a whole; 80 (5) An analysis of the value provided for the cost of the project, that 81 at a minimum includes a cost-benefit analysis, an assessment of 82 opportunity costs and any nonfinancial benefits of the project; 83 (6) Any operational or technological risk associated with the 84 proposed project; 85 (7) The cost of the investment to be made and the economic and 86 financial feasibility of the project; 87 (8) An analysis of public versus private financing on a present value 88 basis, and the eligibility of the project for other public funds from local 89 or federal government sources; 90 (9) The impact to the state's finances of undertaking the project by the 91 agency; and 92 (10) The advantages and disadvantages of using a public-private 93 partnership rather than having the state agency perform the function. 94 (c) An agency shall not include a project solely based upon the 95 amount of potential revenue generated by such project. 96 (d) Any agency submitting a project in accordance with subsection 97 (a) of this section shall at the same time transmit, in accordance with the 98 provisions of section 11-4a, a copy of its submission to the joint standing 99 committees of the General Assembly having cognizance of matters 100 relating to finance, revenue and bonding and appropriations and the 101 budgets of state agencies. Said committees shall hold public hearings on 102 Raised Bill No. 920 LCO No. 3437 5 of 8 any such submission. 103 (e) The Governor shall notify the agency when a project has been 104 approved as a public-private partnership project. 105 (f) On or before January 15, [2013] 2022, and annually thereafter, the 106 Governor shall report, in accordance with the provisions of section 11-107 4a, to the General Assembly concerning the status of the public-private 108 partnerships established under this section. 109 Sec. 3. Section 4-259 of the general statutes is repealed and the 110 following is substituted in lieu thereof (Effective October 1, 2021): 111 (a) Any partnership agreement executed in accordance with the 112 provisions of sections 4-255 to 4-263, inclusive, as amended by this act, 113 shall include, but not be limited to, the following terms and conditions: 114 [(1) The term of the agreement, which shall be for a period not to 115 exceed fifty years from the date of the full execution of the partnership 116 agreement;] 117 [(2)] (1) A complete description of the [facility] project to be 118 developed and the functions to be performed; 119 [(3)] (2) The terms of the financing, development, design, 120 improvement, maintenance, operation and administration of the 121 [facility] project; 122 [(4)] (3) The rights the state, the contractor, or both, have, if any, in 123 revenue from the financing, development, design, improvement, 124 maintenance, operation or administration of the [facility] project; 125 [(5)] (4) The minimum quality standards [applicable to the project] 126 for the development, design, improvement, maintenance, operation or 127 administration of the [facility] project, including performance criteria, 128 incentives and disincentives; 129 [(6)] (5) The compensation of the contractor, including the extent to 130 Raised Bill No. 920 LCO No. 3437 6 of 8 which and the terms upon which a contractor may charge fees to 131 individuals and entities for the use of the [facility] project, but in no 132 event shall such fee extend to the imposition of tolls on the highways of 133 this state unless such tolls are specifically approved by the General 134 Assembly; 135 [(7)] (6) The furnishing of an annual independent audit report to the 136 agency covering all aspects of the partnership agreement; 137 [(8)] (7) Performance and payment bonds or other security deemed 138 suitable by the agency; 139 [(9)] (8) One or more policies of public liability insurance in such 140 amounts determined by the agency to ensure coverage of tort liability 141 for the public and employees of the contractor and to provide for the 142 continued operation of the partnership project; 143 [(10)] (9) A reverter of the project to the state upon the conclusion or 144 termination of the partnership agreement; 145 [(11)] (10) The rights and remedies available to the agency for a 146 material breach of the partnership agreement by the contractor or 147 private entity or if there is a material default; 148 [(12)] (11) Identification of funding sources to be used to fully fund 149 the capital, operation, maintenance or other expenses under the 150 agreement; and 151 [(13)] (12) Any other provision determined to be appropriate by the 152 agency. 153 (b) No partnership agreement shall contain any noncompete 154 provisions limiting the ability of the state to perform its functions. 155 (c) No user fees may be imposed by the contractor except as set forth 156 in a partnership agreement. 157 (d) The partnership agreement shall not be construed as waiving the 158 Raised Bill No. 920 LCO No. 3437 7 of 8 sovereign immunity of the state or as a grant of sovereign immunity to 159 the contractor or any private entity. 160 (e) No contractor shall be liable for the debts or obligations of the state 161 or the agency, unless the partnership agreement provides that such 162 contractor is liable under such agreement. 163 Sec. 4. Section 4-261 of the general statutes is repealed and the 164 following is substituted in lieu thereof (Effective October 1, 2021): 165 (a) Each public-private partnership project shall either be subject to 166 the prevailing wage requirements pursuant to section 31-53 or the rate 167 established by the use of a project labor agreement. The agency shall 168 provide notice of which requirement applies prior to soliciting bids or 169 proposals for such public-private partnership. 170 (b) Each public-private partnership project shall comply with: (1) The 171 state's environmental policy requirements as set forth in sections 22a-1 172 and 22a-1a, (2) the requirements of the set-aside program for small 173 contractors as set forth in section 4a-60g, and (3) any applicable 174 permitting or inspection requirements for projects of a similar type, 175 scope and size as set forth in the general statutes or the local ordinances 176 of the municipality where the project is to be located. 177 [(c) Any agency that is subject to section 4e-16 shall comply with the 178 provisions of section 4e-16, provided, notwithstanding the provisions of 179 subsection (a) of section 4e-16, any agency that enters into a partnership 180 agreement concerning the operations or maintenance of a state facility 181 that meets the definition of a privatization contract, as defined in section 182 4e-1, shall be subject to the requirements of section 4e-16 regardless of 183 whether such services are currently privatized.] 184 This act shall take effect as follows and shall amend the following sections: Section 1 October 1, 2021 4-255 Sec. 2 October 1, 2021 4-256 Sec. 3 October 1, 2021 4-259 Raised Bill No. 920 LCO No. 3437 8 of 8 Sec. 4 October 1, 2021 4-261 Statement of Purpose: To revise the requirements regarding the utilization of public-private partnerships to design, develop, finance, construct, operate or maintain projects. [Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]