Bill Text: HI SB2705 | 2018 | Regular Session | Amended
Bill Title: Relating To Public-private Partnerships.
Spectrum: Partisan Bill (Democrat 5-0)
Status: (Engrossed - Dead) 2018-04-27 - Received notice of discharge of conferees (Hse. Com. No. 687). [SB2705 Detail]
Download: Hawaii-2018-SB2705-Amended.html
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THE SENATE |
S.B. NO. |
2705 |
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TWENTY-NINTH LEGISLATURE, 2018 |
S.D. 2 |
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STATE OF HAWAII |
H.D. 2 |
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A BILL FOR AN ACT
RELATING TO PUBLIC-PRIVATE PARTNERSHIPS.
BE IT
ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Hawaii is faced with limited
if not declining government funding.
This trend is expected to continue, making it more important to partner
with the private sector and leverage limited governmental resources.
A
public-private partnership is a contractual agreement between a public agency
and a private entity that allows for a greater risk transfer to the private
sector in the delivery and financing of a public project in a manner that
creates greater value for the public than traditional delivery methods. In a public-private partnership project, the
public agency retains ownership and substantial control but transfers
responsibility to the private partner under a single contract, which often is a
long-term contract involving lifecycle cost risk. The focus of a public-private partnership is
to provide the best value and performance in its delivery of assets and
services for the benefit of the general public.
Public-private partnership projects will help the state and local governments in undertaking certain capital improvement projects in a more cost-effective and efficient manner by allowing more innovative project delivery methods.
SECTION 2. Chapter 103, Hawaii Revised Statutes, is amended by adding a new part to be appropriately designated and to read as follows:
"Part . office of PuBLIC-PRIVATE pARTNERSHIP
§103- Office of public-private partnership;
established; state public-private partnership coordinator. There is established within the department of
accounting and general services an office of public-private
partnership to support state and county agencies in
the use of best practices in contracting for public-private partnership
projects to deliver and finance public projects at a lower lifecycle cost
and more diversified risk than traditional delivery processes. The comptroller may appoint a public-private
partnership coordinator who shall be exempted from chapter 76, to administer
the office.
§103- Duties.
The office of public-private partnership shall:
(1) Create a strategic plan for the provision of advisory services to state and county agencies that includes:
(A) Objectives and goals for the office of public-private partnership and criteria to measure the objectives and goals;
(B) A website for maintaining the status of public-private projects and best practice resources that meet the office of public-private partnership's objectives and goals;
(C) A framework for retention of qualified legal, financial, and technical advisors that can assist in the delivery of services contemplated by this part; and
(D) The necessary funding to establish and operate the office of public-private partnership and fee structures for advisory services to maintain the office of public-private partnership;
(2) Coordinate collaboration among state and county agencies to analyze the value of potential public-private partnership delivery over other delivery methods permitted in chapter 103D and other needs and goals of the state and county agencies;
(3) Provide to the purchasing agency best practice processes for analysis of and contracting for public-private partnerships, including modeling the potential economic benefits and financial outcomes and contract terms and conditions that will achieve those economic benefits and financial outcomes;
(4) Provide to the purchasing agency best practice processes for resolving contract disputes that may arise in public-private partnerships, including alternative dispute resolution and mediation;
(5) Create and maintain an analysis report of the value of public-private partnership delivery over traditional delivery for each public-private partnership project that shall include:
(A) Proposed economic benefits;
(B) Potential financial outcomes;
(C) Contract terms and conditions; and
(D) Social benefits;
(6) Develop, analyze, and implement plans for future public-private partnership projects, including objectives and criteria to measure the accomplishment of objectives, programs through which the objectives are to be attained, and financial requirements for public resources based on the needs and goals of the State;
(7) Assist state and county agencies, and their respective purchasing agencies, that have an interest in public-private partnership projects with the legal authority to coordinate activities that involve cross-agency responsibilities and encourage the timely and effective implementation and completion of project milestones and objectives among multiple governmental agencies;
(8) Develop educational and advisory programs that enhance the public-private partnership procurement process to continuously encourage best practice procurement of public-private partnership projects that will result in improved infrastructure and government services in the State;
(9) Assist state and county agencies in formulating specific program and procurement documents to solicit public-private partnerships;
(10) Undertake the program established in section 26-6 relating to centralized engineering and office leasing services, to facilitate facility agreements between the State and private investors for the sale of facilities including operation and maintenance of public buildings; and
(11) Establish requirements for public entities intending to conduct a request for information, pre-qualification, or solicitation of public-private partnerships using the public-private partnership procurement process to notify the office of public private partnership and department of accounting and general services to ensure appropriate application of the provisions of this part.
§103- Annual report. The department of accounting and general
services, in coordination with the office of public-private partnership, shall
submit a report to the legislature no later than twenty days prior to the
convening of each regular session, that shall include but not be limited to:
(1) The process developed by the office of public-private
partnership to support state and county agencies in the use of best practices
in contracting for public-private partnerships;
(2) A detailed description of any public-private
partnerships entered into, including a cost-benefit analysis of the public-private
partnership in comparison to the traditional means of financing and delivering
public contracts; and
(3) A detailed listing of any effects the public-private partnership had on state or county agencies involved in the public-private partnership, including fiscal and personnel impacts."
SECTION 3. Section 103D-104, Hawaii Revised Statutes, is amended by adding three new definitions to be appropriately inserted and to read as follows:
""Independent peer reviewer
services" means additional professional services provided to the
purchasing agency in public-private partnership procurements to confirm that
the key elements of the professional engineering and architectural design provided
by the contractor conform to the applicable standard of care.
"Infrastructure facility"
means a building, a structure, or networks of buildings, structures, pipes,
controls, and equipment that provide transportation, utilities, public
education, including government office buildings; public schools; courthouses;
public hospitals; water treatment plants, distribution systems, and pumping
stations; wastewater treatment plants, collection systems, and pumping
stations; solid waste disposal plants, incinerators, landfills, and related
facilities; public roads and streets; highways; public parking facilities;
public transportation systems, terminals, and rolling stock; and rail, air, and
water port structures, terminals, and equipment.
"Public-private partnership"
means a project delivery method in which the purchasing agency enters into a
single contract for any combination of financing, maintenance, or operation in
addition to design-build of an infrastructure facility over a contractually
defined period."
SECTION 4. Section 103D-303, Hawaii Revised Statutes, is amended to read as follows:
"§103D-303 Competitive sealed proposals. (a) Competitive sealed proposals may be used to procure goods, services, or construction that are either not practicable or not advantageous to the State to procure by competitive sealed bidding.
(b)
Proposals shall be solicited through a request for proposals.
(c) Notice of the request for proposals shall be given in the same manner as provided in section 103D-302(c).
(d) Proposals shall be opened so as to avoid disclosure of contents to competing offerors during the process of evaluation. A register of proposals shall be prepared and shall be open for public inspection after contract award.
(e) The request for proposals shall state the relative importance of price and other evaluation factors.
(f) Discussions may be conducted with responsible offerors who submit proposals determined to be reasonably likely to be selected for a contract award for the purpose of clarification to assure full understanding of, and responsiveness to, the solicitation requirements. Offerors shall be accorded fair and equal treatment with respect to any opportunity for discussion and revision of proposals, and 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 offerors.
(g) Award shall be made to the responsible offeror whose proposal is determined in writing to be the most advantageous, taking into consideration price and the evaluation factors set forth in the request for proposals. No other factors or criteria shall be used in the evaluation. The contract file shall contain the basis on which the award is made.
(h) In cases of awards made under this section, non-selected offerors may submit a written request for debriefing to the procurement officer within three working days after the posting of the award of the contract. Thereafter, the procurement officer shall provide the non-selected offeror a prompt debriefing. Any protest by the non-selected offeror pursuant to section 103D-701 following debriefing shall be filed in writing with the procurement officer within five working days after the date upon which the debriefing is completed.
(i)
In addition to any other provisions of this section, construction
projects may be solicited through a request for proposals to use any
combination of the design-build [method;] or public-private partnership delivery
methods; provided that:
(1) A request for proposals is issued to prequalify offerors to select a short list of no more than three responsible offerors, prior to the submittal of proposals; provided that the number of offerors to be selected for the short list shall be stated in the request for proposals and prompt notice is given to all offerors as to which offerors have been short-listed;
(2) A conceptual
design fee may be paid to non-selected offerors that submit a technically
responsive proposal; provided that the cost of the entire project is greater
than $1,000,000; [and]
(3) The criteria for
pre-qualification of offerors, design requirements, development documents,
proposal evaluation criteria, terms of the payment of a conceptual design fee,
or any other pertinent information shall be stated in the request for
proposals[.]; and
(4) Public-private partnership request for
proposals shall:
(A) State the relative importance of:
(i) Demonstrated
compliance with the design requirements;
(ii) Offeror
qualifications;
(iii) Financial
capacity;
(iv) Project
schedule;
(v) Price
or lifecycle price; and
(vi) Other
factors, if any;
(B) Require
each offeror, for a project:
(i) With
a contract price estimated to exceed $10,000,000;
(ii) With
a contract period of operations and maintenance of at least ten years; or
(iii) In
other circumstances identified by the chief procurement officer by rule,
to
include and identify qualified and competent independent peer reviewer
services, which shall be an additional evaluation factor in the award of the
contract; and
(j)
In addition to any other provisions of this section, a contract for
delivery of a construction project procured using a public-private partnership
method:
(1) Shall require, if an operational phase is
part of the project delivery, the use of public worker union positions
customarily and historically used for such operation; and
(2) Shall not be used for the design,
maintenance, or operation of community correctional centers, high security
correctional facilities, or youth correctional facilities that provide public
safety services.
(k) Notwithstanding any other provisions of this
section to the contrary, the purchasing agency may engage in negotiations with
the highest-ranked offeror in a public-private partnership procurement and
may negotiate:
(1) The statement of work;
(2) The contract price as it is affected by
negotiating the statement of work; and
(3) Any other terms and conditions reasonably
related to those expressly authorized for negotiation in the solicitation of public-private partnership
proposals. Accordingly, offerors shall
not submit, and the public entity shall not accept, for negotiation any terms
and conditions that are not reasonably related to those expressly authorized
for negotiation in the solicitation of public-private partnership proposals. In conducting negotiations, there shall be no
disclosure of any information derived from proposals submitted by competing
offerors.
(l) Notwithstanding any other provisions of this
section to the contrary, a purchasing agency may terminate negotiations with an
offeror of a public-private
partnership if such negotiations are not
successful and commence negotiations with the next highest scoring offeror, and
continue this process until the public entity has:
(1) Determined to award the contract to the
offeror with whom it is currently negotiating;
(2) Determined to continue negotiations with
the offerors; or
(3) Determined to cancel the solicitation of
the public-private
partnership."
SECTION 5. Section 103D-323, Hawaii Revised Statutes, is amended by amending subsections (a) and (b) to read as follows:
"(a) Unless the policy board determines otherwise
by rules, bid security shall be required only for construction contracts to be
awarded pursuant to sections 103D-302 and 103D-303 and when the price of the
contract is estimated by the procurement officer to exceed $25,000 or, if the
contract is for goods or services, the purchasing agency secures the approval
of the chief procurement officer. Bid
security shall be a bond provided by a surety company authorized to do business
in the State, or the equivalent in cash, or otherwise supplied in a form
specified in rules[.] and shall be in an amount equal to at least
five per cent of the amount of the bid.
(b)
[Bid security shall be in an amount equal to at least five per cent
of the amount of the bid.] In addition to other requirements of
this section, one or more of the following forms of security shall be required
to assure the timely, faithful, and uninterrupted provision of operations or
maintenance services as elements of public-private partnership procurements:
(1) Operations
period surety bonds that secure the performance of the contractor's operations
and maintenance obligations;
(2) Letters of
credit in an amount appropriate to cover the cost to the purchasing agency of
preventing infrastructure service interruptions for a period up to twelve
months; and
(3) Appropriate written guarantees from the contractor or depending upon the circumstances, from the contractor's parent corporation, to secure the recovery of re-procurement costs to the purchasing agency in the event of a default in performance by the contractor."
SECTION 6.
This Act is not intended to modify and shall not be construed to expand
or limit any rights and duties of any laws relating to the subject of this Act,
unless expressly stated herein.
SECTION 7. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2018-2019 to:
(1) Establish and operate the office of public-private partnership; and
(2) Establish and fill the state public-private partnership coordinator position and one additional position; provided that these positions may be added to the position count for the department of accounting and general services and shall be appointed by the comptroller and exempt from chapter 76, Hawaii Revised Statutes, to carry out the purposes of this Act.
The sum appropriated shall be expended by the department of accounting and general services for the purposes of this Act.
SECTION 8. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 9. This Act shall take effect on July 1, 2112.
Report Title:
Office of Public-Private Partnership; Procurement Code; Appropriation
Description:
Establishes the Office of Public-Private Partnership and the position of State Office of Public-Private Partnership Coordinator. Adds public-private partnership project delivery methods to the Procurement Code and related conditions and requirements. Requires an annual report. Appropriates funds. (SB2705 HD2)
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
