Section 1. Definitions
“Affected Jurisdiction” means any county, municipality, city, town, or special district in which all or a portion of a qualifying project is located.
“Develop” means to plan, design, develop, finance, lease, acquire, install, construct, or expand a qualifying project.
“Comprehensive Agreement” means an agreement between one or more private partners and one or more responsible public entities contractually providing for the responsibilities of all parties in developing or operating a qualifying project in a public-private partnership.
“Concession” means any lease, license, franchise, easement, or other binding agreement transferring rights for the use or control, in whole or in part, of a qualifying project by a responsible public entity for a definite term during which the private partner will provide services in return for the right to receive all or a portion of the revenues of the qualifying project.
“Fees” means rates, fees, or other charges imposed by the private partner or responsible public entity for use of all or a portion of a qualifying project pursuant to a comprehensive agreement.
“Material Default” means any default by private partners in the performance of its duties as outlined in a comprehensive agreement that jeopardizes adequate service to the public from a qualifying project and is not remedied following notice and a reasonable cure period.
“Office” means the office of public facility investment created pursuant to this act.
“Operate” means to finance, maintain, improve, equip, modify, repair, or operate a qualifying project.
“Private Partner” means any natural person, corporation, general partnership, limited liability company, limited partnership, joint venture, business trust, public benefit corporation, nonprofit entity, other private business entity or combination thereof.
“Proposal” means a plan for a qualifying project submitted by a private partner with detail beyond a conceptual level for which all terms determined to be necessary by the responsible public entity, including costs, payment schedules, financing, deliverables, and project schedule, are defined.
“Public-Private Partnership” means an arrangement under which a responsible public entity and a private partner execute a comprehensive agreement pursuant to which the private partner obtains a concession to develop a qualifying project.
“Qualifying Project” means any public facility or infrastructure or improvement to any public facility or social infrastructure that is used or will be used by the public at large or in support of a public purpose or activity including, but not limited to: water and sewer facilities; water or sewer facilities, wastewater facilities; courthouses; civic or education facilities; public transit systems and facilities; ferry and port facilities; housing; airports and intermodal systems; cultural or recreational facilities; medical and health care facilities; utility facilities; and telecommunications facilities.
“Responsible Public Entity” means the state or any agency or authority thereof; a county, municipality, school board, or any other political subdivision of the state or combination of entities; a public body corporate and politic; or a regional entity that serves a public purpose and is authorized to develop or operate a qualifying project.
“Revenues” means all revenues including income; earnings; dedicated tax revenues; fees; lease payments; federal, state, and local appropriations or the appropriations of other funds available to any political subdivision, authority, or instrumentality thereof; bond proceeds; equity investments, service payments, or any combinations thereof arising out of or in connection with supporting the development or operation of a qualifying project, including money received as grants or otherwise from the United States of America, from any public entity, or from any agency or instrumentality of the foregoing in aid of such a qualifying project.
Section 2. Office of Public Facility Investment
A.There shall be established an Office of Public Facility Investment which shall be a part of the executive office of the governor but shall not be subject to the supervision or control of said executive office, or of any board, bureau, department or other entity of the commonwealth, except as specifically provided in this act. The office shall be headed by an executive director, appointed by the governor for a fixed term of five years, who shall have demonstrated knowledge, training, or experience in one or more of the following areas: public facility development or operation; capital markets and finance, including municipal finance; law; public-sector planning; or procurement.
B. The office shall:
1.Assist each affected jurisdiction and responsible public entity with identifying projects, including opportunities for project aggregation and the combination of one or more qualifying projects, for which a public-private partnership may be appropriate;
2.Provide technical assistance and expertise to each affected jurisdiction and responsible public entity on using public-private partnerships to develop or operate qualifying projects, including analyzing their benefits, revenues, and costs and the innovative financing options available to support them;
3.Supply template, form, and sample contracts;
4.Track proposed, ongoing, and completed private-public partnerships elsewhere in the United States of America and the world for the purpose of staying current with the best practice associated with public-private partnerships and providing advice with respect to such best practice as a public-private partnership center of excellence;
5.Identify methods of encouraging competition for the development or operation of qualifying projects;
6.Serve as a liaison to the federal government and state and local public officials charged with undertaking qualifying projects and promoting public-private partnerships;
7.Conduct public and stakeholder engagement and outreach, including efforts to encourage transparency and information-sharing regarding public-private partnerships;
8.Create a process for updating, as necessary, the recommendations made by the task force created pursuant to this act;
9.Consult, as necessary, with the task force, the office of the inspector general, the office of the attorney general, the executive office for administration and finance, the Massachusetts school building authority, and such other agencies of the commonwealth and other public entities as may be appropriate in carrying out the requirements and authority of this act;
10.Promote best practices, including standardized methodologies and processes and adopt and issue policies with respect to public-private partnerships consistent with this act; and
11.Attract private investment in public facilities, infrastructure, and qualifying projects in the commonwealth.
C.The executive director shall file with the Joint Committee on State Administration and Regulatory Oversight and shall post online a report annually not later than August 1 of each calendar year that:
1.Lists those responsible public entities that—
a.are expected to be soliciting proposals for public-private partnerships within the next fiscal year;
b.have solicited proposals for public-private partnerships within the fiscal year just ended,
c.have executed a comprehensive agreement and are undertaking a public-private partnership;
d. have completed a public-private partnership; or
d.considered, but withdrew from consideration a public-private partnership during the fiscal year just ended; and
2.Identifies trends and other best practices in public-private partnerships developed, initiated or otherwise undertaken during the fiscal year just ended and recommendations of opportunities for public-private partnerships in the commonwealth; and
3. Summarizes actions taken by the office to fulfill its duties pursuant to this act during the fiscal year just ended.
D.The executive director, within three months of appointment by the governor, shall convene a public-private partnership task force, which is directed to:
1.Make recommendations within one year of its first meeting, and following a period of public review, to advise responsible public entities on a uniform process for the review, solicitation, evaluation, award, and delivery of public-private partnerships and the development of qualifying projects including:
a.A process for acceptance of solicited and unsolicited proposals by a responsible public entity;
b.A specific schedule for review of solicited and unsolicited proposals by responsible public entities that shall include public solicitation of additional proposals prior to entering into a comprehensive agreement;
c.Timeframes and requirements for public outreach prior to entering into a comprehensive agreement on a selected proposal, whether solicited or unsolicited. Such timeframes and requirements shall provide for a reasonable period of public review and comment;
d. Recommendations as to the process to be undertaken to determine the value provided by proposed qualifying projects estimated to cost in excess of a minimum financial threshold through a value for money analysis;
2.Determine a cost threshold for qualifying projects, depending on type of project and type of responsible public entity, to merit standardized screening and an independent audit pursuant to this act;
3.Make any recommendations to the general court and the governor on any changes to this act deemed necessary to carry out the purposes set forth herein; and
Following public release of the final report required under this subsection, the task force shall continue to meet periodically as determined by the co-chairs to serve as an oversight panel for the actions taken in accordance with the authority set forth in this act, provided that the co-chairs shall be authorized to terminate the task force at any time following the public release of the final report.
E.The task force shall be composed of nine members, as follows:
1.The secretaries of the executive office for administration and finance and executive office of energy and environmental affairs, or their designees, who shall serve ex-oficio as co-chairs of the task force; and
2.Seven members appointed by the governor having expertise, knowledge, or experience in infrastructure development or operation, capital markets and finance, public-sector planning, law, or procurement
3.Not more than five members of the task force shall be members of the same political party. Members of the task force shall represent geographically diverse regions of the commonwealth.
F.A responsible public entity shall follow the final recommendations of the task force with regard to any public-private partnership undertaken in accordance with the authority set forth in this act, except that a responsible public entity may adopt guidelines for public-private partnerships that are inconsistent with the recommendations of the task force so long as such guidelines are not inconsistent with this act.
G.The office and the task force shall coordinate their activities and recommendations on the matters authorized and provided for in this act with the public-private partnership infrastructure oversight commission created pursuant to section 73 of chapter 6C.
H.The office shall coordinate with responsible public entities on environmental reviews and permitting for all qualifying projects subject to this act. As soon as practicable, and not later than the execution of a comprehensive agreement, the responsible public entity shall identify all commonwealth permits and other approvals necessary for each qualifying project, and in consultation with the office and relevant state offices and departments, shall create a timeline for review and issuance of such permits. The office shall maintain on its website a listing of projects under this section for which commonwealth permits or other approvals are delayed more than 90 days past the deadline specified in the timeline and post an official explanation for the delay which shall come from the office in charge of approving the permit, or link to public websites containing such information.
I.For qualifying projects with an estimated cost meeting the threshold determined by the task force pursuant to this section, the office, in coordination with the responsible public entity, shall independently assess whether a public-private partnership is expected to provide a greater value to the public than would be available through a traditional procurement process.
Section 3. Government Agreements
Each responsible public entity may, either separately or in combination with any other public entities, enter into working agreements, coordination or cooperation agreements, or similar implementation agreements, including the formation of agreements with any federal, state or local agency or other responsible public entity to develop or operate a qualifying project subject to the requirements of this act. Each such agreement shall otherwise be subject to applicable law.
Section 4. Project Delivery Methods
A.Subject to the requirements of this act, and notwithstanding any general or special law to the contrary, each responsible public entity may solicit proposals to utilize any project delivery method or agreement or combination of methods or agreements to develop or operate a qualifying project, including but not limited to: a design-build agreement; a design-build-maintain agreement; a design-build-finance-operate agreement; a design-build-finance-operate-maintain agreement; a construction manager at risk agreement that includes provisions pertaining to a private partner’s obligation to finance, develop and or operate a qualifying project, and a concession providing for the private partner to develop ,design, build, operate, finance, manage, and or lease a qualifying project.
B.Each such procurement and agreement shall be subject to compliance with the applicable requirements of federal, state and local law, including the prevailing wage requirements at sections 26 to 27H, inclusive, of chapter 149, but shall not be subject to the competitive bid requirements set forth in sections 38A1/2 to 38O, inclusive, section 39M of chapter 30, or sections 44A to 44M, inclusive, of chapter 149 or the requirements of chapter 30B.
C.Prior to solicitation of any proposal pursuant to the authority set forth in this act, each responsible public entity shall establish, post online, and shall file with the Joint Committee on State Administration and Regulatory Oversight and Joint Committee on Transportation and the Office of the Inspector General detailed procedures to be used in carrying out its duties and responsibilities set forth in this act.
Section 5. Procurement Process; Solicited and Unsolicited Proposals
A.The responsible public entity may request proposals from private partners to develop a qualifying project under one or more of the project delivery methods set forth in this act. The responsible public entity shall not charge a fee to cover the costs of processing, reviewing, and evaluating proposals received in response to such a request. Prior to soliciting any request for proposals for any qualifying project, a responsible public entity shall complete a value for money analysis evaluating and documenting the expected costs, benefits, advantages and disadvantages of each qualifying project. A copy of the value for money analysis shall be posted on the the website of the responsible public entity, and copies shall be provided to the office, the task force, the office of the inspector general, the office of the attorney general, and the secretary for administration and finance.
B.Each request for proposals issued by any responsible public entity shall include design requirements and other information pertaining to the qualifying project as the responsible public entity may determine appropriate, the proposed form of comprehensive agreement to be executed between the private partner and the responsible public entity upon award, and shall solicit proposal development documents appropriate for the qualifying project. The proposed form of comprehensive agreement proposed by the responsible public entity shall contain minimum participation requirements for minority and women-owned businesses as then are required by the division of capital asset management and maintenance, and a requirement that the successful private partner shall perform not less that fifty per cent of the work related to the qualifying project. Requests for proposals may, if the responsible public entity determines that the cost of preparing proposals is high, considering the size, estimated price and complexity of the procurement:
1.prequalify offerors by issuing a request for qualifications in advance of the request for proposals;
2. develop a short list of responsible offerors prior to discussions and evaluations, if the number of proposals that will be short-listed is stated in the request for proposals and prompt public notice is provided to all offerors as to which proposals have been short-listed; or
3. pay stipends to unsuccessful offerors; provided, however, that the amount of such stipends and the terms under which such stipends shall be paid shall be included in the request for proposals.
C.Responsible public entities shall provide adequate public notice of the request for proposals and shall, when appropriate, provide interested persons, affected jurisdictions, and members of the public with an opportunity for public comment prior to the publication of the final request for proposals. Prior to or simultaneously with the release of each request for proposals, each responsible public entity shall forward a copy of the request for proposals to the office, the task force, the office of the inspector general, the office of the attorney general, and the secretary for administration and finance.
D.A private entity may request a review, prior to submission of a solicited proposal, of information that the private partner has identified as confidential or proprietary to determine whether such information is subject to disclosure under section 10 of chapter 66 or clause twenty-sixth of section 7 of chapter 4
E.The evaluation criteria established by a responsible public entity for each request for proposal shall state the relative importance of price of the concession and, at a minimum, the following evaluation factors: (1) demonstrated compliance with the design requirements; (2) offeror qualifications; (3) financial capacity; (4) project schedule; (5) elimination of existing public debt with respect to the facility; (6) lowest user charges or price over the term of the comprehensive agreement; and (7) other factors, if any, and shall not include, as an evaluation factor in the award of the concession, the amount, if any, paid by a contractor to the responsible public entity.
F.Responses to each request for proposals shall be opened so as to avoid the disclosure of contents to competing offerors during the process of negotiation. A register of proposals shall be prepared by the responsible public entity and shall be open for public inspection after contract award.
G. On the condition that the process is disclosed in the request for proposals, discussions may be conducted with prospective private partners which submit proposals determined to be reasonably susceptible of being selected for award of the concession for the purpose of clarification of the proposal or to assure full understanding of, and responsiveness to, the solicitation requirements as detailed in the request for proposals. Prospective private partners shall be accorded fair and equal treatment with respect to any opportunity for discussion and revision of proposals, and such revisions may be permitted after submissions and prior to award for the purpose of obtaining best and final offers. In conducting discussions, there shall be no disclosure of any information derived from proposals submitted by competing prospective private partners.
H.Each responsible public entity shall award the concession and shall execute the comprehensive agreement with the private partner whose proposal best conforms to the solicitation and is determined in writing to be the most advantageous to the responsible public entity, taking into consideration the price and the evaluation factors set forth in the request for proposals consistent with the requirements of this act. The contract file shall contain the basis upon which the award was made. Written notice of the award of a concession to the successful private partner shall be promptly provided to all offerors.
I.Each responsible public entity may provide debriefings that furnish the basis for the source selection decision and award of the concession.
J.In addition to formal request for proposals authorized in accordance with this act, a private partner may request approval by a responsible public entity of an unsolicited proposal using one or more of the project delivery methods authorized in this act consistent with recommendations made by the task force or any alternative guidelines adopted by a responsible public entity. A responsible public entity may charge a reasonable fee to cover its costs to process and review unsolicited proposals. Any such alternative guidelines shall be filed with the office, the task force, the office of the inspector general, the office of the attorney general, and the secretary for administration and finance
K.Upon submitting any proposal to a responsible public entity, a private partner shall identify those portions of a proposal that the private partner considers to be a trade secret or confidential commercial, financial, or proprietary information and provide any justification as to why these materials, upon request, should not be disclosed by the responsible public entity. A private partner shall fully comply with any applicable state laws for such materials to be exempt from disclosure. Projects under federal jurisdiction or using federal funds must conform to federal regulations under the Freedom of Information Act.
L.Except to the extent it adopts alternative guidelines pursuant to this act, for any selected proposal for a qualifying project with an estimated cost meeting the financial threshold determined by the task force, the responsible public entity shall obtain an independent audit of the proposed private-public partnership, including an assessment of projected revenues, usage and public costs, before the comprehensive agreement is executed. The analysis shall be disclosed to the public prior to execution of a comprehensive agreement, subject to the limitations described in this act.
E.The responsible public entity may apply for local, state, or federal credit assistance, or endorse such applications submitted by private partners, for qualifying projects to be developed or operated pursuant to a comprehensive agreement and may engage such consultants and other experts at any point to assist in the evaluation, negotiation, development or operation of qualifying projects as it determines to be in the public interest.
Section 5. Finding of Public Interest
A.The responsible public entity may enter into a comprehensive agreement for the development or operation of a qualifying project only after the applicable governing body or other duly authorized officer of the responsible public entity makes a finding of public interest which shall, at a minimum, consider the following:
1.Benefits to the public;
2.Advantages or disadvantages of developing or operating the qualifying project as a public-private partnership versus a traditional procurement, including the anticipated cost over the project life-cycle, adjusted for risk and risk transfers;
3.Sources of funding and financing for the qualifying project;
4.General reputation, qualifications, industry experience and financial capacity of the private partners;
5.The compatibility of the proposal with commonwealth. Regional and local policy and commonwealth, regional and local plans; and
6.Other criteria that the responsible public entity deems appropriate.
B.The responsible public entity shall publicly disclose all findings of public interest and commonwealth, regional and local compatibility made pursuant to the requirements of this section in a public report, which shall include a detailed discussion of all considerations on which the findings are based. Copies of such report shall be provided to the office, the task force, the office of the inspector general, the office of the attorney general, and the secretary for administration and finance
Section 6. Notice to Affected Jurisdictions Regarding Unsolicited Proposals
A.Prior to entering into a comprehensive agreement resulting from an unsolicited proposal, the responsible public entity shall notify affected jurisdiction(s) by furnishing a copy of the proposal to each affected jurisdiction.
B.Each affected jurisdiction that is not the responsible public entity may, within sixty days after receiving the notice, submit in writing any comments on the project’s potential impact or compatibility with local and regional budgets and infrastructure plans to the responsible public entity.
C.The responsible public entity shall consider the comments of the affected jurisdictions before entering into a comprehensive agreement with a private partner.
Section 7. Public-Private Partnership Agreements
A.Interim Agreements. Before or in connection with the negotiation of a comprehensive agreement, the responsible public entity may enter into an interim agreement with the private partner that submitted the selected proposal. An interim agreement shall not obligate the responsible public entity to enter into a comprehensive agreement. The interim agreement is discretionary with the parties and is not required on a qualifying project for which the parties may proceed directly to a comprehensive agreement without the need for an interim agreement. An interim agreement shall only:
1.Authorize the private partner to commence activities for which it may be compensated related to the proposed qualifying project, including, but not limited to, project planning, advance right-of-way acquisition, design and engineering, environmental analysis and mitigation and ascertaining the availability of financing for the proposed facility; and
2.Establish the process and timing of the negotiation of the comprehensive agreement.
B.A responsible public entity may enter into an interim agreement with multiple private partners if the responsible public entity determines in writing that is it in the public interest to do so.
C.Comprehensive Agreements. Prior to developing or operating a qualifying project, the private partner that submitted the selected proposal shall enter into a comprehensive agreement with the responsible public entity. Comprehensive agreements, in addition to other contract terms stipulating the obligations of the parties, must include:
1.Descriptions of which party will assume responsibility for specific project elements and when;
2.How the parties will share management of the risks of the project;
3.How the parties will share costs of development or operation of the project;
4.How the parties will allocate financial responsibility for cost overruns provided, however, that in no event shall the responsible public entity be responsible for cost overruns except to the extent the responsible public entity requests a change to the qualifying project;
5.Any safeguards to mitigate additional costs or service disruptions to the public in the event of material default or cancellation of the agreement;
6.Performance standards and any damages for nonperformance and details on what constitutes a material default by each party to the comprehensive agreement;
7.Any performance incentives;
8.Accounting and auditing standards to be used to evaluate work on the project;
9.The responsibility for reconstruction or renovations required for a qualifying project to meet all applicable government standards upon termination of the comprehensive agreement; and
10.Such other terms and conditions agreed to mutually by the responsible public entity and the private partner.
D.The comprehensive agreement shall provide for such fees as may be established by agreement of the parties.
E.The comprehensive agreement shall contain a provision by which a private partner expressly agrees that it is prohibited from seeking injunctive or other equitable relief to delay, prevent or otherwise hinder the responsible public entity or any jurisdiction from developing or operating any project that was planned and that may impact the revenue that the private partner may derive from the qualifying project under a public-private partnership, except that the comprehensive agreement may provide for reasonable compensation to the private partner for the adverse effect on revenues resulting from an unplanned revenue that impacts the qualifying project.
Section 9. Eligible Funding and Financing; Property Acquisition
A.Any financing of a qualifying project may be in such amounts and upon such terms and conditions as may be determined by the parties to the interim or comprehensive agreement. The private partner and responsible public entity may utilize any and all revenues that may be available to them for the purposes of this act and may, to the fullest extent permitted by applicable law:
1.Issue debt, equity, or other securities or obligations;
2.Enter into leases, concessions, and grant and loan agreements;
3.Access any designated state funds;
4.Borrow or accept grants from any state infrastructure bank;
5. Apply for, obtain, issue and use private activity bonds or other financing or funding available under any federal law or program; and
6.Secure any other financing with a pledge of, security interest in, or lien on any or all of its property, including all of its property interests in the qualifying project.
B.Any bond or note issued under this act section shall constitute the corporate obligation of the responsible public entity, shall not constitute a debt of the commonwealth within the meaning or application of the constitution of the commonwealth; and shall be payable solely as to both principal and interest from:
1.The revenues from a lease to the responsible public entity, if any;
2.Proceeds of bonds or notes, if any;
3.Investment earnings on the proceeds of bonds or notes; or
4. Other funds available to the responsible public entity for such purpose.
C.The responsible public entity may take any action to obtain federal, state, and/or local assistance for a qualifying project that serves the purpose of this act and may enter into contracts required to receive such assistance. To the fullest extent allowed by law, federal, state, and local monies and revenues may be combined with any private sector monies and revenues for any project purposes. Nothing in this section shall limit a local government or any agency or authority of the commonwealth to issue bonds for qualifying projects.
D.Each responsible public entity is authorized to acquire right-of-way for any qualifying project by any means permitted under applicable law.
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