Public-private partnerships among last-minute ’sticking points’
Keith M. Phaneuf
October 25, 2011
A controversial proposal to employ public-private partnerships to implement certain state construction projects is one of a handful of “sticking points” delaying final, bipartisan agreement on a new package of job growth bills, Gov. Dannel P. Malloy announced Tuesday afternoon.
But Malloy, who addressed Capitol reporters briefly following a closed-door meeting with legislative leaders, quickly added that all parties had agreed to resume talks and predicted that a legislative package with bipartisan support would be presented to the full House and Senate on Wednesday.
The partnerships, often referred to as P-3 “is an area people are still talking about,” the Democratic governor said while flanked by lawmakers from both sides.
Union leaders and members representing thousands of public-sector workers balked at a public hearing last week when administration officials said they wanted greater flexibility to coordinate the design, construction and inspection services for capital projects through the private sector.
Malloy’s budget chief, Office of Policy and Management Secretary Benjamin Barnes, said the P-3 approach would complement the administration’s ongoing efforts to expand state bonding for capital construction projects, boosting a hard-hit industry.
State agencies overseeing capital projects typically coordinate design, construction and inspection services separately, often relying on a variety of companies to perform those roles. They also, depending on the project, may employ state engineers, other designers and inspectors.
Under the P-3 concept, the administration would have more flexibility to deal with one private entity, such as a construction company that would either provide its own design and inspection services, or coordinate with other businesses to provide them.
Union leaders countered that unless government oversight of all aspects of a public project is carefully maintained, they typically ended in botched work and cost-overruns.
“We urge you not to move forward with such an untested and controversial program during the special session,” Anderson told lawmakers. “Public-private partnerships reduce transparency, accountability and oversight of public services. And as government oversight shrinks, decisions driven by profit margin, and not a desire to ensure quality work and fair wages, become common.
The State Employees Bargaining Agent Coalition, which negotiates benefits on behalf of about 45,000 unionized state workers, issued a statement praising Malloy and the legislature for holding a jobs growth special session, but it condemned the P-3 concept.
“Using this special session to rush through bad public policy ideas like ‘design-build’ construction and ‘public-private partnerships’ would be a tragic error,” the coalition statement read. “If implemented, these concepts could reduce oversight and accountability, open the door to corruption and back-room dealing, and ultimately both damage public projects and cost jobs.”
The governor said Monday that he believes a compromise can be found, and that the goal would be to use the P-3 approach for those projects whose financing is being repaid with revenues from that project. For example, if Connecticut wished to borrow funds to construct a new parking garage, it could hire a company or companies to design, construct and operate the garage — all under one contract. The company would then provide payments to cover the debt service with profits from the garage receipts.
Legislative leaders from both parties declined to comment following the closed-door meeting.
Though no drafts of legislative language have been released to date, the administration unveiled a broad outline last week of most proposals to be considered in Wednesday’s special legislative session.
State government would invest more than $500 million in bonding for business and infrastructure investments, offer new tax break aimed at small businesses, and hire a consultant to streamline regulations, focusing on four large permit-issuing departments.
©Copyright 2011 The Connecticut News Project. All rights reserved.
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