Bill Text: HI SB1003 | 2019 | Regular Session | Amended
Bill Title: Relating To Innovative Project Delivery Guidelines.
Spectrum: Partisan Bill (Democrat 6-0)
Status: (Engrossed - Dead) 2019-03-22 - Passed Second Reading as amended in HD 1 and referred to the committee(s) on FIN with none voting aye with reservations; none voting no (0) and Representative(s) Quinlan, Yamane excused (2). [SB1003 Detail]
Download: Hawaii-2019-SB1003-Amended.html
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THE SENATE |
S.B. NO. |
1003 |
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THIRTIETH LEGISLATURE, 2019 |
S.D. 2 |
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STATE OF HAWAII |
H.D. 1 |
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A BILL FOR AN ACT
RELATING TO INNOVATIVE PROJECT DELIVERY GUIDELINES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that there is a public need for timely design, construction, improvement, renovation, expansion, modernization, equipping, maintenance, operation, implementation, and installation of public infrastructure and state government facilities, as existing public procurement methods are not wholly satisfying this need.
The legislature also finds that enabling innovative project delivery modalities that allow state agencies to leverage limited resources with private sector capital and expertise may benefit public safety and welfare.
The legislature additionally finds that
according to the attorney general, the state procurement code does not preclude
the use of innovative project delivery models, including design-build-finance-operate-maintain
contracts by state agencies.
While well-structured innovative project delivery approaches can benefit state and local communities by optimizing risk transfer, accelerating delivery, incentivizing innovation, and ensuring life-cycle asset management at prescribed service levels, the legislature recognizes that these arrangements may also involve long-term, direct, and contingent obligations to the State. Consequently, the application and use of innovative project delivery requires additional consideration by the legislature.
The purpose of this Act is to establish adequate safeguards, procedures, and protocols for innovative project delivery arrangements for public infrastructure.
SECTION 2. (a) The purpose of this Act is to establish requirements for the development of guidelines and procedures that will enable state agencies to enter into innovative project delivery arrangements for qualified public infrastructure projects.
(b)
This Act shall only apply to contractual arrangements in which state agencies
undertake to engage a delivery partner pursuant to chapter 103D, Hawaii Revised
Statutes, for the design, construction, operation, or maintenance of a facility
or infrastructure project that serves a public purpose, with the delivery partner assuming all or a
substantial part of the risks associated with the financing, delivery, and
operation of the project.
(c)
This Act shall not apply to:
(1) Budget-neutral contracting approaches for the design, construction, financing, operation, and maintenance of building improvements that reduce energy and increase operational efficiency; or
(2) Facility or infrastructure projects serving a public purpose that have a capital cost of less than $10,000,000.
SECTION 3. For purposes of this Act:
"Delivery partner"
means a private entity that has entered into a qualified innovative project
delivery agreement with a public entity.
"Innovative project
delivery" means a contractual arrangement under which a delivery partner
carries out the design, rehabilitation, construction, financing, operation, or
maintenance of a public facility or infrastructure project over a contractually
defined period while assuming all or a substantial part of the risks associated
with the delivery and performance of the public purpose facility or infrastructure
project. Innovative project delivery may
involve any of the following activities or any combination thereof:
(1) Design, construction, financing, maintenance, or operation of new infrastructure facilities;
(2) Rehabilitation, modernization, financing, expansion, maintenance, and operation of existing infrastructure facilities; and
(3) Administration, management, operation, maintenance, or other services pertaining to new or existing infrastructure facilities.
The term "innovative project delivery" shall only apply when the delivery partner assumes significant economic risk and the public sector retains ownership of the public purpose infrastructure asset. The term "innovative project delivery" shall not apply to ground leases on public properties when the development on the property is primarily or materially for private or non-public use.
"Private entity" means a natural person, corporation, limited liability company, partnership, joint venture, or other private business entity.
"Public entity" means any department, commission, council, board, bureau, authority, committee, institution, legislative body, agency, government corporation, or other establishment or office of the executive, legislative, or judicial branch of the State, including the office of Hawaiian affairs.
SECTION 4. (a) There is created the innovative project delivery guidelines task force within the department of accounting and general services to establish guidelines to institute safeguards, procedures, and protocols around the use of innovative project delivery arrangements for public infrastructure, in protection of the public interest.
(b) The innovative project delivery guidelines task force shall be composed of the following eight members:
(1) The comptroller or the comptroller's designee, who shall serve as chair of the innovative project delivery guidelines task force;
(2) The director of finance, or the director's designee;
(3) The director of business, economic development, and tourism, or the director's designee;
(4) The administrator of the state procurement office, or the administrator's designee;
(5) Two members to be appointed by the governor, as follows:
(A) One representative of the business community; and
(B) One professional or expert with extensive private or public sector advisory experience relating to innovative project delivery of public purpose infrastructure involving private financing;
(6) One member to be appointed by the president of the senate; and
(7) One member to be appointed by the speaker of the house of representatives.
(c) In reviewing and developing innovative project delivery guidelines, the innovative project delivery guidelines task force shall consider, at a minimum, the following:
(1) Scope of application;
(2) Allowable contract modalities;
(3) Ineligible public purpose projects and other exclusions;
(4) Asset ownership considerations;
(5) Contract term requirements;
(6) Financial rights and interests;
(7) Conditions for the use of private or blended financing for public purpose projects;
(8) Funding requirements and disclosures;
(9) Allowable compensation structures;
(10) Screening and approval processes;
(11) Allowable procurement procedures;
(12) Requirements of the innovative project delivery agreement;
(13) Requirements and procedures for the financial review and analysis of innovative project delivery projects, including but not limited to:
(A) Public needs assessment;
(B) Financing and delivery options analysis;
(C) Public benefits analysis;
(D) Value for money assessment; and
(E) Consideration of the results of all other feasibility studies and analyses related to the proposed innovative project delivery project;
(14) Institutional framework and tools to support state agencies to identify, implement, and oversee innovative project delivery arrangements;
(15) Governance and oversight considerations, including the management of contingent liabilities deriving from innovative project delivery agreements;
(16) Statutorily established reporting requirements; and
(17) Internal and external audit requirements for innovative project delivery arrangements.
(d) The department of accounting and general services shall provide technical and administrative support to the innovative project delivery guidelines task force.
(e) The innovative project delivery guidelines task force shall solicit public feedback on innovative project delivery guidelines as part of its deliberations.
(f) The innovative project delivery guidelines task force shall submit its final recommendations to the legislature no later than twenty days prior to the convening of the regular session of 2020, at which time the innovative project delivery guidelines task force shall be dissolved.
(g) The department of accounting and general services shall adopt rules pursuant to chapter 91, Hawaii Revised Statutes, based on the recommendations of the innovative project delivery guidelines task force for the use of innovative project delivery approaches by state agencies.
SECTION 5. 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 2019-2020 for the procurement, hiring, or securing of experts and professional advisory services, and training of task force members to assist in the implementation of this Act.
The sum appropriated shall be expended by the department of accounting and general services for the purposes of this Act.
SECTION 6. This Act shall take effect on July 1, 2050.
Report Title:
DAGS; Innovative Project Delivery Guidelines Task Force; Public Infrastructure; Procurement; Appropriation
Description:
Establishes the Innovative Project Delivery Guidelines Task Force to establish guidelines for the use of innovative project delivery arrangements for public infrastructure. Requires DAGS to adopt rules. Requires task force to submit report to the 2020 Legislature. Appropriates moneys. (SB1003 HD1)
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
