2017 Kentucky Revised Statutes CHAPTER 65 - GENERAL PROVISIONS APPLICABLE TO COUNTIES, CITIES, AND OTHER LOCAL UNITS .028 Public-private partnership delivery method of awarding contracts for capital construction projects -- Kentucky Local Government Public-Private Partnership Board.
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65.028 Public-private partnership delivery method of awarding contracts for
capital construction projects -- Kentucky Local Government
Public-Private Partnership Board.
(1)
(2)
(3)
(4)
(5)
As used in this section:
(a) "Best value" has the same meaning as in KRS 65.025;
(b) "Cabinet" means the Finance and Administration Cabinet;
(c) "Local government" means a city, county, charter county, urban-county
government, consolidated local government, or unified local government
of the Commonwealth;
(d) "Private partner" has the same meaning as in KRS 65.025; and
(e) "Public-private partnership" has the same meaning as in KRS 65.025.
A public-private partnership delivery method may be utilized by a local
government as provided in this section and administrative regulations
promulgated thereunder. Contracts using this method shall be awarded by
competitive negotiation on the basis of best value, and shall in all cases take
effect only if executed by the legislative body of the local government. The
provisions of KRS 65.025(2) to (4) shall not apply to public-private partnerships
utilized by local governments.
A local government utilizing a public-private partnership shall continue to be
responsible for oversight of any function that is delegated to or otherwise
performed by a private partner.
A public-private partnership shall not be used to circumvent any requirements
or restrictions placed upon any local government pursuant to any provision of
the Kentucky Revised Statutes.
All public-private partnership agreements executed by a local government or
any of its agencies under this section shall be approved by the legislative body
of the local government at a public meeting, and shall include at a minimum the
following provisions:
(a) 1.
Property owned by a local government shall not be sold, conveyed,
or disposed of in any way at any time; and
2.
Leases issued by a local government to any party shall not be
transferred in any way by that party;
without the specific and express written consent of the legislative body of
the local government;
(b) Require the private partner to provide or cause to be provided
performance and payment bonds on the design and construction portion
of the agreement as required under KRS 45A.435 and maintenance
bonds, warranties, guarantees, and letters of credit in connection with the
private partner's other activities under the agreement, in the forms and
amounts satisfactory to the local government and in amounts necessary
to provide adequate protection to the local government;
(c) Review and approval of plans and specifications for the project by the
local government;
(d) Inspection of the project by the local government to ensure that the
private partner's actions are acceptable to the local government in
(e)
(f)
(g)
(h)
(i)
(j)
(k)
(l)
(6)
(a)
(b)
(c)
accordance with the agreement;
Maintenance of public liability insurance or self-insurance, in form and
amount satisfactory to the local government and reasonably sufficient to
insure coverage of tort liability to the public and employees and to enable
the continued operation of the project;
Reimbursement to be paid to the local government for services provided
by the local government;
Filing of appropriate financial statements by the private partner on a
periodic basis;
Policies and procedures governing the rights and responsibilities of the
local government and the private partner in the event the public-private
partnership agreement is terminated or there is a material default by the
private partner. These policies and procedures shall include conditions
governing assumption of the duties and responsibilities of the private
partner by the local government, and the transfer or purchase of property
or other interests of the private partner by the local government;
Any fees or payments as may be established by agreement of the private
partner and the local government;
A detailed description of all duties and requirements of the private
partner;
The ability of a private partner or partners to quickly respond to the needs
presented in the request for proposal, and the importance of economic
development opportunities represented by the qualifying project. In
evaluating proposals, preference shall be given to a plan that includes the
involvement of small businesses as subcontractors, to the extent that
small businesses can provide services in a competitive manner, unless
any preference interferes with the qualification for federal or other funds;
and
Any other information necessary to properly address the life cycle of the
agreement, including the disposition of assets if or when the public-private
partnership agreement is terminated or otherwise concludes.
On or before December 31, 2016, the secretary of the Finance and
Administration Cabinet shall promulgate administrative regulations setting
forth criteria to be used by a local government employing a public-private
partnership for a particular project, and establishing a process for
public-private partnership procurement undertaken by local governments
consistent with this section. Prior to submission of the proposed
administrative regulations pursuant to the regulatory process required by
KRS Chapter 13A, the proposed administrative regulations shall be
approved by the Kentucky Local Government Public-Private Partnership
Board established by subsection (11) of this section.
The secretary shall consult with design-builders, construction managers,
contractors, design professionals including engineers and architects, and
other appropriate professionals during the development of these
administrative regulations.
The secretary shall have the authority to contract with a consultant,
pursuant to KRS 45A.695, to assist the cabinet and the Kentucky Local
Government Public-Private Partnership Board with the review process
required in subsection (12) of this section. The secretary may, through
administrative regulation, impose a reasonable fee on the private partner
to defray the cost of the review required in subsection (12) of this section,
including any expenses or fees incurred in contracting with a consultant.
(d) If the secretary fails to timely promulgate administrative regulations
pursuant to this subsection, local governments may then act pursuant to
this section including compliance with the process outlined in subsection
(12) of this section, in the absence of administrative regulations.
(7) A request for proposal for a local government project utilizing a public-private
partnership shall include at a minimum:
(a) The parameters of the proposed public-private partnership agreement;
(b) The duties and responsibilities to be performed by the private partner or
partners;
(c) The methods of oversight to be employed by the local government;
(d) The duties and responsibilities that are to be performed by the local
government and any other partners to the contract;
(e) The evaluation factors and the relative weight of each to be used in the
scoring of awards; and
(f) Other information required by a local government to evaluate the
proposals submitted by respondents and the overall proposed
public-private partnership.
(8) A private entity desiring to be a private partner shall demonstrate to the
satisfaction of the local government that it is capable of performing any duty,
responsibility, or function it may be authorized or directed to perform as part of
the public-private partnership agreement.
(9) When a request for proposal for a project utilizing a public-private partnership
is issued, the local government shall transmit a copy of the request for proposal
to the cabinet and to the Department for Local Government.
(10) A request for proposal or other solicitation may be canceled, or all proposals
may be rejected, if it is determined in writing that the action is taken in the best
interest of the local government and approved by the legislative body.
(11) (a) There is established within the cabinet the Kentucky Local Government
Public-Private Partnership Board, composed of eleven (11) members as
follows:
1.
The secretary of the cabinet, or the secretary's designee;
2.
Two (2) individuals appointed by the Kentucky League of Cities,
both of whom shall have experience in municipal financial
operations;
3.
Two (2) individuals appointed by the Kentucky Association of
Counties, both of whom shall have experience in county financial
operations, one (1) to be recommended by the Kentucky County
Judge/Executive Association and one (1) to be recommended by the
Kentucky County Magistrates and Commissioners Association;
4.
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(12) (a)
The commissioner of the Department for Local Government, or the
commissioner's designee;
5.
The executive director of the Office of Financial Management within
the cabinet, or the executive director's designee;
6.
The Auditor of Public Accounts, or the Auditor's designee;
7.
One (1) citizen member appointed by the Governor, who shall have
experience and knowledge in local government debt and financial
operations; and
8.
Two (2) members of the Kentucky General Assembly, one (1)
appointed by the President of the Senate and one (1) appointed by
the Speaker of the House of Representatives, each of whom shall
serve in a nonvoting ex officio capacity and shall not be considered
for purposes of determining a quorum.
Members of the board shall begin their terms on August 1, 2016, and
shall serve for a term of four (4) years.
Board members appointed under paragraph (a)2. and 3. of this
subsection may send a designee with similar experience to meetings for
which they are unavailable.
Vacancies occurring in the term of any member shall be filled in the same
manner as the original appointment.
The members of the board shall receive no compensation for their
services.
The secretary of the cabinet, or the secretary's designee, shall serve as
chair of the board and the members shall elect a vice chair from among
the membership of the board. The vice chair may preside over meetings
of the board in the absence of the chair.
The board shall meet at least once per year, and as needed for the timely
consideration of proposed projects. A majority of the members of the
board shall constitute a quorum.
The secretary of the cabinet shall be responsible for providing staff
support and maintaining complete records of the board's actions and
proceedings, as public records open to inspection.
Upon the initial issuance of a public-private partnership agreement having
a total contractual value that equals or exceeds thirty percent (30%) of the
general fund revenues received by the local government in the
immediately preceding fiscal year, the local government shall submit the
agreement to the cabinet for the sole purpose of making an evaluation to
the Kentucky Local Government Public-Private Partnership Board of the
following:
1.
Whether the agreement meets the requirements of subsection (5) of
this section;
2.
An analysis of the overall project's economic and financial viability
within the scope of available or proposed financing arrangements
and expected revenues; and
3.
Whether the agreement adheres to the procurement process
(13)
(14)
(15)
(16)
required by subsection (2) of this section.
Public-private partnership agreements having a total contractual value
that is less than thirty percent (30%) of the general fund revenues
received by the local government in the immediately preceding fiscal year
shall not be required to be submitted to the cabinet or the Kentucky Local
Government Public-Private Partnership Board.
(b) The local government shall submit any information required by the
cabinet, relating to the agreement and its procurement, to enable the
cabinet to conduct this evaluation.
(c) The cabinet shall acknowledge receipt of the agreement within thirty (30)
days, and after evaluation thereof shall, within ninety (90) days of its
receipt, forward the results of its evaluation separately to each individual
member of the Kentucky Local Government Public-Private Partnership
Board. The full board shall meet within sixty (60) days of the issuance of
the cabinet's evaluation to consider the evaluation provided by the cabinet
and approve or disapprove the proposed agreement. If the board
disapproves the project, the board shall provide specific reasons for its
disapproval. If the board approves the project, the cabinet shall return the
agreement to the local government legislative body for final execution
thereof. No public-private partnership agreement issued by a local
government that is subject to evaluation by the cabinet and review and
approval by the Kentucky Local Government Public-Private Partnership
Board pursuant to paragraph (a) of this subsection shall take effect unless
and until it is approved by the Kentucky Local Government Public-Private
Partnership Board pursuant to this subsection and is found by the board
to meet the requirements of this section and to be economically viable as
provided in this subsection.
(d) If an agreement is not approved by the board, the local government
submitting the agreement may modify the agreement and resubmit it for
reconsideration in accordance with this section.
The Commonwealth shall bear no liability for public-private partnership
agreements approved pursuant to subsection (12) of this section.
Upon approval and execution of a public-private partnership agreement, the
local government shall transmit a copy of the agreement to the Department for
Local Government.
The Auditor of Public Accounts may periodically review public-private
partnership agreements executed by a local government pursuant to this
section, and any actions undertaken by private partners and local governments
thereunder, to evaluate compliance with the agreement and this section.
Multiple local governments, acting in accordance with KRS 65.210 to 65.300,
may jointly enter into a public-private partnership pursuant to this section.
Public-private partnership agreements involving multiple local governments
shall only be required to be submitted to the cabinet for evaluation and to the
Kentucky Local Government Public-Private Partnership Board for review and
approval, as provided by subsection (12) of this section, if the total contractual
value equals or exceeds thirty percent (30%) of the combined general fund
revenues received in the immediately preceding fiscal year by all local
governments participating in the agreement.
(17) (a) A person or business may submit an unsolicited proposal to a local
government, which may receive the unsolicited proposal.
(b) Within ninety (90) days of receiving an unsolicited proposal, a local
government may elect to consider further action on the proposal, at which
point the local government shall provide public notice of the proposal
pursuant to KRS Chapter 424 or electronically on the Web site of the local
government, and shall:
1.
Provide specific information regarding the proposed nature, timing,
and scope of the unsolicited proposal, except that trade secrets,
financial records, or other records of the person or business making
the proposal shall not be posted unless otherwise agreed to by the
local government and the person or business; and
2.
Provide for a notice period of at least thirty (30) days and no more
than ninety (90) days for the submission of competing proposals.
(c) Upon the end of the notice period provided under paragraph (b)2. of this
subsection, the local government may consider the unsolicited proposal
and any competing proposals received. If the local government
determines it is in the best interest of the local government to implement
some or all of the concepts contained within the unsolicited proposal or
competing proposals received by it, the local government may begin an
open, competitive procurement process to do so pursuant to this section.
(d) An unsolicited proposal shall be deemed rejected if no written response is
received from the local government within ninety (90) days after
submission, during which time the governmental body has not taken any
action on the proposal under paragraph (b) of this subsection.
Effective:March 27, 2017
History: Amended 2017 Ky. Acts ch. 132, sec. 6, effective March 27, 2017. -Created 2016 Ky. Acts ch. 67, sec. 5, effective April 8, 2016.
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