Thursday, February 26, 2015

P3 bill passes House, heading to Senate

FRANKFORT--The House voted 84-13 today to advance a bill that would provide oversight and regulations to public-private partnerships, so-called “P3s,” for state government and major transportation projects in Kentucky.

 House Bill 443, sponsored by Rep. Leslie Combs, D-Pikeville, and House Majority Caucus Chair Sannie Overly, D-Paris, would allow state government and major transportation projects to partner with private companies to complete public infrastructure, transportation and other needs. 

Provisions regarding local governments found in last session’s P3 bill—which was passed by the 2014 General Assembly but vetoed by the governor due to an amendment that would have eliminated the possibility of tolls for a Northern Kentucky bridge project -- are not found in HB 443, said Combs. 

 “I understand the concerns that have been expressed by several, and right now what we’re going to do is focus on state agencies and transportation. Let’s move this forward because this is something that I think this state definitely needs,” said Combs.

 She also said HB 443 does not mandate use of tolls on any project. The issue of tolls has been a concern of some lawmakers, particularly those in Northern Kentucky where there are concerns about replacing the aging I-75/I-71 Brent Spence Bridge over the Ohio River. Combs said the legislation specifically states that  a “state authority shall not enter into a public-private partnership related to a project connecting the Commonwealth with the State of Ohio unless the General Assembly expressly authorizes it by passing a joint resolution.”

 “This bill is about creating public private partnerships in Kentucky. It is not about a particular project. It’s not about doing a project in Northern Kentucky. It’s not about doing tolls,” said Combs.

Several amendments were filed to the bill including those called by Rep. Arnold Simpson, D-Covington. Some of his amendments failed but others were approved, including Simpson’s amendments would: require that major transportation projects connecting Kentucky to adjoining states be constructed and financed by a bi-state authority and that only that authority be allowed to enter into a P3 as part of the project; require additional cost analysis of any proposed transportation project that exceeds $100 million in total cost to see if a P3 is in the public interest; require that tolls imposed as part of a transportation project costing over $100 million that uses P3s expire when the initial construction debt is paid.

“Relative to full disclosure I think I need to admit two things,” said Simpson. “First, I am the individual who filed the amendment last year that basically precluded the utilization of tolls on the Brent Spence Bridge corridor project, and make no apologies for that. And the second thing I would like to tell you is I hate tolls.”

Simpson said P3s have been used in Kentucky for years including in local government. But he said P3 projects are “so large in scale that we have to proceed very cautiously. If we fail to do so, it puts our tax base at great jeopardy.”

HB 443 now goes to the Senate for consideration. An emergency clause attached to the bill would allow the bill would take effect immediately if it is signed into law.