|Volume 6, Issue 26||October 8, 2014|
Lessons learned from failed projects
Mary Scott Nabers, President/CEO, Strategic Partnerships, Inc.
Public officials worry about what happens if a public-private partnership (P3) is not successful. And, taxpayers want to know what happens if a bankruptcy occurs. While failed public projects are not common, they have occurred. So, what can be learned from unsuccessful projects, especially those that are collaborations between public and private entities?
The first thing to learn is that the financial models must be absolutely sound. The responsibility to plan well falls squarely on both parties. There must be a "safe and stable" return on investment (ROI) model in place - one that is fair to both partners.
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|Federal funds flow to I-285/Ga 400 interchange|
$1.06 billion project will include public-private partnership as part of financing
More than 400,000 motorists seeking relief on the Georgia 400/I-285 interchange got some good news recently. Gov. Nathan Deal (pictured) announced that the Federal Highway Administration (FHWA) has approved the Atlanta Transportation Improvement Plan that includes money for a project aimed at relieving congestion on the interchange.
"These interchange improvements are crucial to improving Georgia's transportation infrastructure,"Deal said. The governor said that now that the funding has been approved, construction can begin on what is expected to be a $1.06 billion project, part of which will benefit from a public-private partnership.
Deal said the state is using all the tools it has available, from motor fuel revenues, bonds and the state's AAA bond rating to help bring the project to fruition.
Included in the project is the construction of new flyover ramps, new collector-distributor lanes and other facilities that are aimed at improving east-west travel on I-285 and north-south travel on Ga 400.
Deal and Georgia Department of Transportation board members in May approved the sale of $130 million in previously authorized bonds for the project. Another $81.5 million in accrued state motor fuel funds will also be used. The remainder of the funding will likely come from a public-private partnership model.
|Maryland voters may 'lock up' transportation fund|
Constitutional amendment at stake in November elections could limit spending
In Maryland, the Transportation Trust Fund is a fund separate from the General Fund. The Transportation Fund is used for operating and capital expenses for highway, transit, aviation, port and motor vehicle services and projects. In November, voters in the state will decide if they want to keep it that way!
A referendum will allow voters to approve a constitutional amendment that will limit spending of the state's transportation fund on anything that is not transportation-related.
The fund includes money from motor fuel taxes, motor vehicle excise taxes, motor vehicle registration and licensing fees, bond proceeds, rental car sales taxes, a portion of the state's corporate income tax and revenues from transit, port and aviation operations. If the amendment passes, those funds cannot be spent for non-transportation purposes unless a fiscal emergency is declared by the governor and both houses of the legislature approve, with a three-fifths vote in each chamber, transfer of any of the money.
During the recent recession, Maryland, like some other states, transferred money from the transportation fund to help balance the budget. The result was that the state's transportation infrastructure suffered from lack of funding. A bill was passed in the 2013 legislature to put an amendment proposition on the ballot to limit using those funds - putting the funds in a "lockbox."
|Upcoming education opportunities|
Plans under way for University of Wisconsin-Madison music school
A 300-seat recital hall and 3,100-square foot rehearsal space are part of Phase I of plans for a new music school for the University of Wisconsin-Madison. Plans for the facility were recently presented to the city's Urban Design Commission. The project is expected to be executed in three phases. It will eventually replace the Humanities building on the campus. The building will feature a wrap-around glass lobby that will provide an eye-appealing exterior, but does not interfere with the acoustics. The recital halls will be two and one-half feet thick with a layer of concrete on the outside, an airspace and another layer of concrete lining the inside. Phase I of the construction also will include a large glass wall built on the corner of the recital hall so that persons on the outside of the building can see what's happening inside. Phase II will include an almost 800-seat concert hall while Phase III will include academic support space such as classrooms, practice rooms and faculty offices. Designs for the remaining phases are expected to be completed next October. Construction, however, could begin as late as November 2017.
County in North Carolina may put $125 million bond on ballot in 2016
A $125 million bond election in Orange County, North Carolina, is looming for 2016. If approved, the bond referendum would provide funds for renovation of schools and other buildings. County officials and officials of the two school districts involved met recently to discuss their needs. It was determined that $500 million in renovations are needed, with $330 million of them in the schools. They are studying now whether to borrow up to $125 million of that to be paid back by the county over 20 years. Officials were told by Todd LoFrese (pictured), assistant superintendent for support services, that a "significant" investment was needed in the Chapel Hill-Carrboro City School district, including safety and security issues as well as problems due to the age of the facilities. Pam Jones, interim deputy superintendent of the Orange County Schools, said that district is facing a similar situation. CHCCS is likely to need another elementary school in 2019, sad LoFrese, based on student population growth. However, officials are hopeful that instead of new facilities, they can save some money by adding capacity to existing schools. "The problems are not going to go away unless we start to focus on our older schools," LoFrese said.
Capital improvements referendum to lead to renovations, upgrades
Voters recently approved a referendum that will result in a variety of upgrades and renovations at the Frenchtown (New Jersey) School District. The funding will be used for new windows, bathroom renovations, roof replacements and conversion of a boiler from oil to natural gas. The referendum's approval will pay for 60 percent of the costs of the projects, with the remaining 40 percent from four regular operating grants provided by the state. School officials say the grant share would be $902,000 and local taxpayers will fund $1.3 million of the project through a 15-year bond. The total cost for all four projects would be $2.2 million.
Workforce, Business Development Center planned for Walla Walla CC campus
The Walla Walla Community College in Clarkston, Washington, will be the site of a new Workforce and Business Development Center funded by the U.S. Economic Development Administration. The Financial Assistance Award of $2.35 million will be used to construct the center. "The Economic Development Administration indicated that the impact of this investment would be the creation of 470 new jobs over a 10 year period. WWCC is fortunate to get funds to build a center that will help students prepare for jobs," sad WWCC President Dr. Steven VanAusdle (pictured). Job growth in the manufacturing industry is expected to continue to increase in the area. The new center will provide room for classrooms and lab space for workforce training in mechatronics, industrial maintenance, welding and fabrication, precision machining, electricity and energy systems and business programs. Space will also be available for community members and business owners to collaborate and grow entrepreneurial endeavors. Elected officials called the investment "great news for Southeastern Washington workers, businesses and the regional economy" and provide the workforce "with training and skills they need to succeed" by investing in workforce development. The process to select an architect has begun.
Regents approve renovations at ASU's Sun Devil Stadium
The Arizona Board of Regents recently approved a $256 million plan to renovate Sun Devil Stadium at Arizona State University. The renovation work is expected to be completed by August 2017 and will include upgraded seating in the lower bowl to allow for more leg room. Also in the plan is a state-of-the-art video and scoreboard and a new sound system. The project also includes renovation of some $80 million in sewer and electrical work. Restrooms and concessions will be demolished and rebuilt. Fundraising for the project is under way, with a goal of $85 million. The renovations will be paid for from increased stadium revenue, anticipated naming rights, TV revenue distribution from the Pac-12 Conference and revenue from an athletic-facilities district of 330 acres. No public funds will be used. The first phase of construction is expected to begin in January 2015. Officials are expecting to return to ask the Regents for approval in November for the first phase of the project, which carries a price tag of $40 million to $45 million.
University of Kansas considering possible new residence hall on campus
A new 500-bed residence hall is being considered for the campus of the University of Kansas. An increase in international students is expected at the UK campus, and university officials are planning ahead to meet their housing needs. The proposed facility would also feature a new dining center to serve it and other residence halls. With more than 2,200 international students on campus now, the university is working with a firm to recruit more international students. The project, which will also include an academic resource center, will be paid for with housing and dining funds and bonds sold through the Kansas Development Finance Authority. Construction could start in spring 2016, with a completion date of summer 2017.
|Other upcoming contracting opportunities|
Philadelphia Regional Port Authority issues REI for terminal development
A public-private partnership is being explored for development of a waterfront terminal complex - Philadelphia's Southport Terminal Complex. The Philadelphia Regional Port Authority recently released a Request for Expressions of Interest (REI) for development of the 200-acre site, but a P3 is looking good to port officials. "We look forward to establishing a productive public-private partnership with one or more interested parties to develop and operate these top-notch sites," said PRPA Chairman Charles G. Kopp (pictured). "With industrial-zoned waterfront land at an absolute premium along the Eastern Seaboard of the United States, I know that this substantial acreage, with its many inherent qualities and fine location, will prove a great asset to the right company or companies." The report last year received a proposal for developing a terminal on the land. But, the proposal was later withdrawn when the developers could not find a major carrier partner. There are actually three tracts of land being offered - the Southport Marine Terminal, the Southport West Terminal and Pier 124's North Berth. Officials have indicated that all proposals that can help enhance trade and commerce will be considered. And, those who respond to the REI may submit plans for one, two or all three parcels.
Lubbock seeking bids for $44 million water reclamation plant
Lubbock city officials recently asked companies to submit bids for construction of a new water reclamation plant expected to process 5 million gallons of wastewater per day. The new plant is designed to allow expansion of the plant to handle up to 15 million gallons per day of wastewater, city officials said. The deadline for submitting bids is Oct. 31. Council members expect to select the winning bid on Dec. 4.
Current plans call for the new wastewater treatment plant in the northwest area of the city to be completed within two years after construction begins.
New York state sets ambitious goal to increase minority contracting figures
In an effort to boost the number of contracts with minority-owned businesses, New York state has set an ambitious goal of increasing to 30 percent its contracts with businesses owned by minorities or women. It is one of the highest goals of its kind in the United States, higher than the previous high 29 percent goal for the state of Maryland. The state reached its goal of 20 percent last year, so moving to 30 percent this year was only a natural response. Gov. Andrew Cuomo (pictured) said the state will reach that goal and then tell other states, "You can follow us." Today, contracts in the state with minority-owned businesses total about $2 billion and the percentage of businesses holding those contracts has doubled since 2011. Cuomo said the initiative is part of the state's larger work to knock down racial and gender barriers to employment, housing and education.
Texas city earns $1.2 million grant to build international trade center
The city of Pharr, Texas, recently received a $1.2 million grant from the Economic Development Administration to build a 15,000-square-foot, $2.9 million International Trade Center that also will serve as a disaster recovery center. Current plans call for the two-story trade center to serve as the focal point for business and trade along the U.S.-Mexico border and is expecting an increase in employment, tourism and entertainment venues. South Texas College and other organizations also agreed to assist the new trade center in Pharr by providing career-training workshops.
|Who's winning government contracts?|
Check out these recent awards:
- Acts II Construction, Gouverneur won a $1.063 million contract from the town of Clayton, New York, for completing the shoreside amenities on the Frink Riverwalk, which includes landscaping and overlook construction. The project amenities will include two overlooks and viewing areas and landscaping around the Boater Service Building and by the Frink Riverwalk.
- Knife River won a $5.3 million contract from the Wyoming Department of Transportation Commission for a full-depth reclamation on 3.7 miles of Wyoming highway 310 west of Wheatland.
- Ramtech Building Systems was awarded a $1.1 million design-build contract from the Brackett (Texas) Independent School District to provide for the permanent modular construction of an 11,616-square-foot freestanding classroom wing for the high school campus.
- CivilWorx Construction LLC won a $1.24 million contract from the city of Tuscaloosa for utility relocation work required for the development of the Alberta Parkway project. The work will involve the relocation and installation of the city's storm and sanitary sewer, water line and fiber optic networks between 26th Avenue and the Alberta School of Performing Arts and near the Alabama Power substation on 25th Avenue East (between Fire Station No. 4 and Seventh Street).
- Bombardier Transportation was awarded a $296 million, 15-year contract from New Jersey Transit for operations and maintenance services on the River Line Light Rail system. The contract has a five-year option in addition to the 15-year term. It covers train operations, dispatching, vehicle maintenance and maintenance of all right-of-way, facilities and signaling infrastructure
- Necaise Brothers Construction has been awarded a $63.3 million contract by the state of Mississippi for restoration and expansion at the Port of Gulfport. The contract includes installation of base and pavement, utilities and rail line on the expanded West Pier.
- National Bus Sales was awarded a $2.5 million contract by the Corpus Christi Regional Transportation Authority to buy 19 new buses.
- Weddle Bros. Building Group won a $16.894 million contract from the IndyGo Board of Directors to build a new transit center in downtown Indianapolis.
- Affigent won a contract worth up to $4.2 million from the U.S. Department of Veterans Affairs for general purpose information technology equipment.
- Oftdel Construction won a $9.96 million contract with the Wyoming Department of Transportation Commission to build a 1,500-foot-long retaining wall below U.S. Highway 26-89 southwest of the new Snake River Bridge south of Hoback Junction. The highway section above the retaining wall will also be rebuilt.
|News about public-private partnerships (P3)|
Massachusetts city fighting time to ensure parking facility funds released
Money previously OK'd by Gov. Deval Patrick's administration for an inter-modal parking facility in Newburyport, Massachusetts, was approved, but not appropriated. Now, as Patrick will not be seeking re-election and will give up his office in January 2015, city councilors and members of the Newburyport Redevelopment Authority (NRA) are working hard to see that the funds are released before another administration takes over and could possibly disapprove the funding. The money was part of a $3 billion environmental bond bill passed by the Patrick administration.
"We've got until the end of October to work to get this money released," said Mayor Donna Holaday (pictured). "We have to show we support the plan. We must continue to work with the DOT (state Department of Transportation) so the money is released before there is a new governor." Councilors and NRA members met recently and focused on what leaders said was the most immediate element of waterfront planning, and that is building an intermodal facility/parking garage. The city, which is putting up $5 million, would enter into a public-private partnership with New England Development to build the facility. Municipal leaders, however, said that the nature of the partnership could affect the city's financial participation.
P3s could be answer to improving North I-25 in Colorado
The next four years' worth of Surface Transportation Funding will go totally toward projects on I-25 in Colorado. The representatives of the 15 northern Colorado communities that make up the North Front Range Metropolitan Planning Organization recently voted unanimously to allocate those funds - some $13 million - for I-25 projects. Part of the solution to the congestion is to add toll lanes to the highway. That would include a public-private partnership similar to one used on Highway 36 in Colorado. The P3 would add two new lanes that would become managed lanes. Those lanes are tolled, but they do add capacity to the busy highway. The $13 million would go to the Colorado Department of Transportation and would help leverage other funding. The four projects being planned include a new truck lane on Berthoud Hill, a rebuild of the Crossroads Bridge, new toll lanes on I-25 and a mile-long extra lane on the south end of I-25 near the E470 exit and Highway 7.
City in Nevada has two new parks thanks to public-private partnership
Henderson, Nevada's, new turnkey park program has resulted in the addition of two new parks to the city. The Capriola and Potenza parks were recently opened - developed by Inspirada Builders and constructed by Martin Harris. The turnkey program has a developer build a park and then dedicate it to the city for public use. The parks will then be maintained by the city, with maintenance costs coming from the city's $1.2 million annual parks operating budget. The city anticipates paying nearly $20,000 per year for maintenance of each park.
Future maintenance will be paid for by the city, from its $1.2 million annual parks operating budget. It's estimated that it will cost the city nearly $20,000 per year to maintain each park. As the city faces a large budget shortfall, city officials note the importance of Inspirada's investment in the community. "We have a goal in Henderson to provide a park within a half-mile of every residence," said Mayor Andy Hafen (pictured). "We are now closer to that goal for this neighborhood thanks to the public-private partnership with the developer."
|Where are they now?|
Are you a government official who has moved into a new position or to a new agency? Did you recently retire? Were you recently named to an executive-level position at a state-supported college, university or community college? Have you secured a new job as superintendent of a public school? If so, we'd like to hear from you - and so would your friends and colleagues - for our "Where Are They Now" column. Just drop us a line at email@example.com and let us know about your previous job and where you are now. This week we feature Darienne Driver.
Darienne Driver (pictured), who has been serving as interim leader of the Milwaukee Public Schools for the last three months, has been appointed superintendent of the state's largest school district. She became acting superintendent on July 1, after former Superintendent Gregory Thornton resigned to become chief executive officer of Baltimore City Public Schools. Driver was hired from the School District of Philadelphia in 2012 to become the chief innovation officer in Milwaukee Public Schools and oversee schools attempting significant reforms with the help of funding from the GE Foundation. Prior to joining Milwaukee Public Schools, Driver served as Deputy Chief - Curriculum, Instruction and Professional Development, and Deputy Chief - Empowerment Schools for the School District of Philadelphia. In Philadelphia, she oversaw the Empowerment Schools efforts to increase achievement with large numbers of underperforming students and coordinated district efforts to provide needed support. Driver began her education career as an elementary school teacher after graduating from Spelman College in Atlanta. She received a master's degree in curriculum development from the University of Michigan, a master's degree from Harvard's Graduate School of Education and completed her doctorate in education through Harvard's Urban Superintendency program.
|Opportunity of the week...|
A Minnesota school district recently saw voters approve $7.4 million in spending for repairs and upgrades to its school. The school, which opened 15 years ago will provide for such projects as replacing exterior doors and the door-entry system, the fire alarm and phone system and lighting and occupancy sensors. Other projects include replacing rooftop HVAC units and replacement of some roofs. Want to know more? Contact our Sales Team at 512-531-3900 or firstname.lastname@example.org.
Former Lamar University in Texas police chief Jason Goodrich (top left) was recently named director of public safety for the University of Cincinnati, also bringing experience to the job after serving as police chief of Indiana University Southeast and Southern Arkansas University. Noah Simon (top center), an assistant county manager in Georgia, has been chosen as the new city manager for the city of Lexington, Virginia, replacing Jon Ellestad, who is retiring. Suzanne Sherman (top right), who has worked for the city of Palm Bay, Florida, in various jobs since 2007, has been named the new assistant to the city manager. Joseph Clancy, who retired from his post leading the U.S. Secret Service's Presidential Protective Division in 2011, was named acting head of the agency after Director Julia Pierson resigned following a series of major security breaches. Detroit Mayor Mike Duggan has named Denise Starr as the new director of Human Resources and Iris Ware joins the mayor's team in the newly-created role of Chief Learning Officer. Clifton, New Jersey, City Engineer Nick Villano, who has served the city in that capacity since 2010, has been named as the new municipal manager following the resignation of Matt Wakins, who left to become municipal manager in Hudson County. Ken Miller (bottom right) will leave his job as Greensboro, North Carolina's, police chief and take his more than three decades of law enforcement experience to his new job as police chief of the city of Greenville, South Carolina. Howard Gillman (bottom center), who came to the University of California Irvine as executive vice chancellor and provost, was recently appointed as the University of California Irvine's sixth chancellor after having served as UCI's interim chancellor the last three months after Michael Drake's departure to Ohio State University. Lorraine J. Haricombe (bottom left), current dean of libraries at the University of Kansas, has been selected as the new vice provost and director of libraries at The University of Texas at Austin, effective Feb. 1, 2015. Jason Conley, currently employed by the local school district, has been named executive officer of Spokane, Washington's, Parks and Recreation department, the first person to fill that position. Police Capt. Steven Potter, who has been serving in that position for the city of Napa, California, recently was promoted to chief of police and will take over when Chief Richard Melton retires at the end of the year. Grossmont College President Sunita Cooke, who has served that college in El Cajon since 2007 and spent 12 years with the Lone Star College System in Texas, has been chosen as the new superintendent/president of MiraCosta College.
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|Calendar of events|
APTA annual meeting, triennial expo set Oct. 13-15 in Houston
Billed as the world's largest public transportation expo, the annual meeting and triennial expo of the American Public Transportation Association (APTA) will be held in Houston Oct. 13-15. The event will be at the George R. Brown Convention Center, with more than 15,000 leaders and innovators in the public transportation industry expected to attend. The event will feature more than 750 global exhibitors with information on new products and services, more than 80 educational sessions where industry leaders will share their perspectives on the future of public transit and other issues such as aging infrastructure, funding needs and mobility keys. The agenda
is now available.
Georgetown Law to host public-private partnership symposiumAs a follow-up to the White House Rural Council's Rural Opportunity Investment Conference held recently, Georgetown Law is hosting a series of symposiums on public-private partnerships (P3s) during the 2014-2015 academic year. Each symposium will feature government officials, commercial practitioners and academic leaders in a neutral space, to encourage effective and innovative approaches to P3s. The first of the three full-day sessions was held on July 24, and will be followed by events on Oct. 31 and another at a yet-to-be-announced date in early 2015. The October session, "Structuring Public-Private Partnerships for Asset Management," will focus on ways the public and private sectors can partner. The 2015 event, "Partnering with State and Local Governments," will discuss paths for recognizing partnership opportunities, collaborations among state and local governments to share expertise and how to structure partnerships to reduce risks while ensuring value for taxpayer dollars. Later in 2015, another session, "Driving Successful Execution of Public-Private Partnerships," will identify challenges to implementation of P3s and factors that can lead to successful partnerships. For more information, click here.
NASCA plans Institute on Management, Leadership in Santa FeThe National Association of State Chief Administrators (NASCA) will meet in New Mexico this month for its 2014 Institute on Management and Leadership. The event will be Oct. 15-17 in Santa Fe at the Drury Plaza Hotel. Facilitated by the University of Pennsylvania's Fels Institute of Government, the agenda is aimed at executive development and will feature executive development sessions, case study dialogues, networking and peer-to-peer coaching. For more information, click here.
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