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Developing public-private partnerships in the US: Florida passes landmark legislation

Florida has joined a small number of states in the US in passing landmark legislation that enables the state to consider unsolicited public-private partnerships (UPPs).

This has paved  the way for investors confidently to put forward innovative proposals to modernize state infrastructure, while lessening the administrative burden on public entities.

This brief describes the highlights of House Bill 781 which took effect on July 1, 2024. It allows public entities at all levels of government - such as counties, cities and special districts - to enter more easily into P3 deals by: 

  • allowing unsolicited P3 proposals 
  • no longer requiring a public entity to own a project post-completion, expiration or termination of contract
  • changing the legislative language around the term ‘P3’

What are unsolicited P3 proposals?

An unsolicited P3 proposal (UPP) can be submitted by a private entity to a public body, independent of any request for proposal issued by the agency. The proposal can be anything from a new P3 project to innovations that improve a public entity’s current P3 pipeline. Having the ability to submit a UPP encourages private entities to propose creative ways to deliver public projects, whether or not the need has already been identified. Unsolicited proposals can also offer more efficient models to manage existing projects, services, or programs.

What House Bill 781 means

The Sunshine State has had a law (Florida Statute 255/065) authorizing the use of P3s to fund public infrastructure since 2008. However, House Bill 781 now makes it easier for the public and private sectors to work together. Under the new law, counties, cities, towns and special districts will:

Be able to accept unsolicited P3 proposals without being obliged to undertake a lengthy public bidding or solicitation process. Under previous P3 law, if a UPP met certain requirements, the public entity had then to open a proposal up to competitive public bidding, which could last from 21 to 120 days. In practice, this has meant few investors have submitted UPPs in Florida due to the risk of expending significant resources to shape a proposal, only to face a delay and, in a worst-case scenario, lose the opportunity if a competitor’s proposal is selected.

No longer be required to ultimately own the unsolicited proposed project.  The recent law change removes a requirement for the public entity to assume ownership after a project’s completion, expiration or termination. This makes it more likely for a UPP to get off the ground, and clears the way for the private sector to get involved in the operation and management stages.

What are the new criteria for projects to be accepted?

A public entity must first consider the following factors before moving towards accepting a proposal:

  • benefits to the public
  • financial structure and economic efficiency
  • proposer’s qualifications, experience, and ability to perform
  • compatibility of the proposal with regional infrastructure plans

The next stage is to examine a proposal in three steps:

  1. present it at an initial public meeting, allowing other, affected public entities and members of the public to comment
  2. hold a second public meeting where the public entity receives comments and then determines whether the project is in the public interest
  3. publish a report in the Florida Administrative Register explaining the final decision on the project

Tackling public perceptions – providing P3s with a new name 

Another important change within House Bill 781 is designed to tackle public perceptions. This relates to the Florida Department of Transportation (Fl-DOT), which runs major transportation projects. Legislators have replaced the acronym ‘P3’ to avoid stirring negative public perceptions. Instead, the term ‘comprehensive agreements’ seeks to describe the consensual and accountable approach that public and private entities will apply to such joint ventures.

Benefits of Florida’s new approach 

Florida’s House Bill 781 provides a model for other states to improve and modernize their existing P3 laws. Streamlining state legislation makes UPPs more appealing to private investors and reduces the administrative burden on public entities, while still maintaining the robustness of the assessment procedure 

Florida also provides an inspiring blueprint for states which have yet to develop P3 laws. They can develop legislation which both allows for UPPs and includes the creation of a P3 office, which is dedicated to facilitating and overseeing public-private partnerships. The P3 office can help to identify P3 projects, oversee negotiations and deal executions, and manage contracts.

States that create a comprehensive legal framework backed by a dedicated P3 office, can enable public and private entities to come together in partnership to successfully deliver a common goal for the benefit of citizens.

*Other states with UPP legislation include Virginia, Texas, California, and Colorado.

Written by Alessandro Pecorari, Policy & Public Affairs Manager, GIIA. Get in touch with Alessandro here