Creating economic opportunities for Kentuckians and helping tax dollars go farther are key elements of House Bill (HB) 407, filed Wednesday by Rep. Leslie Combs.
“Kentuckians deserve to get the best possible return on their hard-earned dollars, especially in times of tight revenue,” said Combs. “House Bill 407 will create a way to enhance those returns by increasing the involvement of the private sector in public projects, and in effect, promote job growth.”
HB 407 would enable the use of public-private partnerships – so called P3s – by state and local governments, creating a system in Kentucky that already exists in many states. A public-private partnership is a contract between a public entity, such as a state or local government, and a private business, under which the business builds a project or provides a service for the public. Any financial risk during the construction and/or operation of the project is assumed by the private business.
The Kentucky Chamber of Commerce, along with the Kentucky Association of Highway Contractors, the Associated General Contractors of Kentucky (AGC), and nearly 20 local chambers of commerce support the legislation.
“The Kentucky Chamber released its comprehensive P3 report last summer as Phase I. Phase II is for state leaders to embrace the idea of allowing the private sector to help government on public projects,” said Kentucky Chamber President and CEO Dave Adkisson. “We commend Rep. Combs and her colleagues for this forward-looking legislation and are excited about the opportunity to bring Kentucky in line with many other states – including all of those that surround the Commonwealth.”
HB 407 mirrors recommendations in the Chamber’s 2013 P3 report. Among other things, the legislation would:
“This bill is a job creator and will show the contracting community that Kentucky is open to new, creative ways of funding projects,” said Warren Rogers, president and CEO of the W. Rogers Company. “The time is now for Kentucky’s lawmakers to show we are serious about opening Kentucky up for more development in infrastructure.”
P3s have been used in over 30 states for decades, including all of Kentucky’s surrounding states. P3s aren’t limited to state projects; they can also save taxpayers money at the local level. For instance, Indianapolis established a partnership to help the city meet U.S. EPA requirements on its water and sewer lines. The result was taxpayer savings of $200 million.
“This legislation will provide public entities an opportunity to engage the private sector for their construction expertise and financing availability,” said Ellis Hefner, of R.R. Dawson Bridge Company and the current president of AGC of Kentucky. “This is a tool in their toolbox.”