Sweeney/Oroho P-3 Bill To Expand Public-Private Partnerships Advances

TRENTON – Legislation authored by Senate President Steve Sweeney and Senator Steve Oroho that would permit government entities to enter into public-private partnership agreements with private entities for building and highway infrastructure projects was approved by a Senate committee today.

“We have to maximize the impact of public and private resources to create jobs and generate economic growth,” said Senator Sweeney (D-Cumberland, Gloucester, Salem). “Public-private partnerships are an innovative way to permit a wider array of entities to engage the private sector in order to advance critical infrastructure and facilities projects. It will be good for the state.”

The bill, S-865, would allow government entities to enter into agreements under which the private entity assumes financial and administrative responsibility for the development, construction, reconstruction, repair, and maintenance of a project financed in whole or in part by the private entity. The public entity would be allowed to become the owner or lessee of the project, could issue debt to pay for their obligation, and would be exempt from public procurement and contracting requirements.

“Public-private partnerships offer the opportunity for a win-win scenario, and governments at all levels should be permitted flexibility in financing their capital needs given proper oversight,” said Senator Oroho (R-Sussex/Morris/Warren). “They are an important way to stretch scarce public dollars in order to complete needed projects that will benefit our residents, create jobs and economic growth.”

Under the bill, local government units, school districts, state government entities, and state colleges and universities would be eligible to enter into public-private partnership agreements with private entities.

The bill also requires that workers employed in the construction, rehabilitation, or building maintenance services of a project under a public-private agreement be subject to the applicable provisions of the “New Jersey Prevailing Wage Act;” that building construction projects undertaken contain a project labor agreement; and that the general contractor, construction manager, design-build team, or subcontractor for a project is registered and classified by the state to perform work on a project.

“We’ve seen success stories through these kinds of innovative partnerships both in New Jersey and other states, so expanding eligibility to additional public entities will allow us to enhance the economic benefits,” added Senator Sweeney.

Under the bill, a public-private partnership project may be structured using availability payments as a financing method and would provide for oversight of these agreements by the New Jersey Economic Development Authority.

The bill was approved 12-0 by the Senate Budget and Appropriations Committee.

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