TXIC Texas Infrastructure Council Planning and building the future for Texas' infrastructure
Texas Infrastructure Council Mission To support state and local governments in the formation and implementation of a centralized P3 Center of Excellence, to act as a resource for best practice processes related to the procurement of infrastructure through public-private partnerships and the development of a strategic pipeline of infrastructure projects. Goal To create an entity within state government capable of fulfilling the stated mission that will have sustainable revenue sources from fees paid by government clients and from projects within two years. Strategy Create a 501(c )(6) non-profit entity funded by the private sector that is dedicated to working with state and local government stakeholders to identify the necessary talent to staff the P3 Center of Excellence and to equip them with the tools and processes from similar successful entities in other jurisdictions. 2
Getting started The timeline for implementation must be coordinated with the 2015 Texas legislative session so that the industry know-how is ready to deploy when the Center of Excellence is established. Texas Infrastructure Council (Step 1) 3 Months Form the Texas Infrastructure Council (TIC) Recruit private industry and public sector members Establish Board of Directors and finalize Mission/Goals/Strategy Collaborative Development of Strategy (Step 2) 6 Months Confirm state and local financial support of a P3 Center of Excellence TIC assists in the creation of the P3 Center of Excellence TIC assists in the optimization of budget and processes TIC assists in the recruitment of world class staffing P3 Center of Excellence (Step 3) 12 Months P3 Center of Excellence funded and staffed with proper oversight Competitive fee structure and marketing collateral adopted P3 Center of Excellence becomes resource to other public entities 3
The Problem xxx xxx After three years with little to no use of the P3 statute and mounting infrastructure needs, the Texas Legislature is exploring ways to make this funding provision a viable option. The Legislature is looking to private industry for assistance to form a self-sustaining public entity that will be a P3 Center of Excellence resource for all levels of government to use to procure and successfully deliver their infrastructure projects using P3. The Legislature does not have access to the experience and knowledge from other states and countries and will not be able to act with the know-how required to establish the P3 Center of Excellence with a proven model tailored to fit specific needs. Therefore, private industry must take the initiative and lead the way with its time, talent, and treasure to equip the political leadership and, ultimately, the P3 Center of Excellence with the intellectual resources needed to launch the entity as effectively and efficiently as possible. The experiences of the federal government, other states, and other countries over the last decade are clearly instructive. In almost every case, the utilization of P3 delivery was similarly limited and lacked consistency until the government s personnel and processes were consolidated under dedicated leadership and strategically leveraged as a resource. The Partnership Advisory Commission structure in the Texas P3 statute has not been effective and will not be effective in providing the necessary guidance because of inherent limitations in the Commission s ability to develop expertise in these complex transactions. The American Society of Civil Engineers ranks Texas as one of the worst states in its recent assessment of infrastructure in almost every category. Moreover, population growth of over 400,000 people per year continues to exacerbate the problem. 4
The Opportunity Public-private partnerships are being done successfully in Texas at the Texas Department of Transportation (TxDOT). It is the only governmental entity in the State that has achieved a level of competency in the utilization of publicprivate partnerships through its delivery of $22 billion in road projects using P3s in the last 8 years. Despite this success, the obstacle for every other state agency and local government is the lack of qualified resources to assist government in filtering the pipeline of projects suited for P3 delivery so that the limited funding is conserved for the projects best delivered with traditional methods. Under the current approach, each governmental entity is forced, with very limited budgets, to hire consultants and develop its own internal competency with the increased risk inherent in these complex projects. The results have been dysfunctional, at best, which has had a chilling effect on the willingness of the private sector to continue to invest in the proposal process. The Solution Texas Infrastructure Council The Time to act is now! The Texas Infrastructure Council (TIC) is a non-profit corporation formed for the sole purpose of providing resources and advice to the Texas Legislature and Governor during this critical time for the orderly creation of the P3 Center of Excellence. Membership in TIC will be private sector organizations and associations interested in the promotion of best practices within government to achieve a predictable pipeline of projects as well as consistent results, objectives, and informed decision making in the delivery of public infrastructure through public-private partnerships. This will require a combination of resources with an intimate knowledge of Texas politics and public sector trust at both state and local levels, as well as connections and access to leading entities and companies with of a wealth of experience in P3 delivery. 5
Texas requires a dedicated P3 Center of Excellence to bring consistent best practices and structure to public infrastructure delivery. 6 Texas P3 Center of Excellence The Center of Excellence will be an alliance of local and regional governmental entities with a dedicated staff and budget under a government corporation established for the purpose of assisting of public sector entities in meeting public infrastructure needs through public-private partnerships. The Center of Excellence will be funded with an incremental initial contribution from the State that will be replaced by fees for services to state and local government entities utilizing its services in the development of projects. This will be accomplished by: Creating appropriate principles and framework for successful project development and delivery that result in value for the public dollar, accountability and transparency. Advancing creative project financial structures that will protect the public interest and be attractive to private and institutional public infrastructure investors. Connecting the private and public sectors to opportunities by providing consistent, comprehensive, and high quality information. Assisting P3 participants in identifying, understanding, mitigating, and managing risk. Developing and disseminating best practices to strengthen public sector capacity and expertise in P3 procurement methodology. Ensuring that Texas has the necessary tools to successfully provide public infrastructure for a sustainable economic future.
Benefits of a Texas P3 Center of Excellence Over the past several decades, the most successful P3 programs in the world have benefited from dedicated institutional frameworks designed to manage and guide both programs and projects. Whether advisory, regulatory or executive in nature, the creation of the appropriate institutional framework for P3 has demonstrated it effectiveness through the following: Standardized Best Practices/Consistency of Criteria A centralized resource helps to standardize best practices and eliminate the need to "reinvent the wheel" for every project. Consistency of criteria is crucially important to protect the public against failed projects and mitigate implementation risk. Successful P3 Entities Partnerships British Columbia Infrastructure Australia Partnerships UK/Infrastructure UK Infrastructure Ontario Global experience shows that centralized resources help ensure successful projects. Enhanced Public Sector Capacity The ability to leverage "lessons learned", as well as to have access to best practice experts greatly enhances the public sector's ability to effectively utilize P3. The Center of Excellence serves as a "one-stop-shop for advice and expertise. Better Projects The existence of a central resource has consistently yielded more balanced and sustainable projects by facilitating the application of best practice and lessons learned. Superior Efficiencies and Economies of Scale A specialized resource results in more efficient implementation of projects, streamlining processes, and reducing transaction times and expenses. It provides governmental entities easy access to standardized criteria, procedures, and pre-existing templates. Expanded Private Sector Interest/Lower Risk Premiums A central resource helps establish the context within which individual projects are procured, financed and, implemented, and can provide comfort to investors. The use of standardized contractual provisions helps establish precedents which reduce the risk of individual projects, thereby lowering required financial returns. Greater Transparency and Accountability A centralized Center of Excellence serves as a repository and provider of information and metrics about projects, facilitates stakeholder understanding, and fosters greater accountability and transparency that incentivize public officials to include P3s in their financing toolkit. 7
Texas Infrastructure Council Management Team Timothy Merriweather, TIC Executive Director Expertise: Public Private Partnership, Public Finance, Public Sector Capital Project Procurement Tim has more than 30 years experience in public finance, public-private partnerships and targeted public sector procurements in Texas. Tim's core experience is identifying and delivering consultancy services for public sector clients at the local and state level, the development of procurement solicitation documents, performance-based contracts, value for money analysis, and public capital procurement methodology. Tim has been involved in the organizational effort and passage of Texas P3 Legislation since 2011. He is a frequent speaker on public-private partnership legislation, public infrastructure and public policy formulation. Tim has significant experience working with a variety of public sector clients and has served as financial advisor to a state-level organization on a wide variety of projects, including issuance of tax-exempt bonds, preparation bond offering documents, financial analysis for a capital improvement programs, and bond elections. His clients have included K-12, higher education, utilities, cities, counties and state agencies. Tim is the Managing Partner at Banister Group and was previously Director of Public-Private Partnerships at Longbow Partners and Vice President at Masterson Moreland Sauer Whisman. Contact Information: tim@banistergroup.com or P: +1.512.750.3119 Russell Keene, Coalition Management and Media/Communications Advisor Expertise: Public Affairs Advocacy Strategy, Issue Management and Media Relations Russ has been involved in federal and state public affairs communications for more than 25 years. He began the boutique public relations firm Crossnore Group in 2008 after leading the Austin office of global public relations firm, Burson-Marsteller for five and one-half years. He is also a principal in The Monument Group, an Austin-based public affairs consultancy. Throughout his career, Russ has advised some of the country's leading brands on business development, communications, procurement, and government relations strategy. Russ has successfully implemented government affairs, civic and business grassroots, and location-based public and political support campaigns. Russ' earlier career includes communications and government relations positions in Texas and Washington with the Texas Society of Professional Engineers, the American Gas Association and Enserch Corp. He has held management positions in attorney general, gubernatorial, state, legislative, and presidential campaigns. Russ is a Dallas native and 6 th generation Texan. Contact Information: russ@crossnoregroup.com P: +1.512.344.2606 Richard Seline, Policy Advisor and Strategist Expertise: Alternative Revenue Generation, Public-Private Partnership, Business & Community Development, New Market Tax Credits, Incentives Richard Seline is a senior advisor for Crossnore Group focusing on infrastructure, technology, and innovation-based economic development. Richard is a proven senior project manager, consultant, and technical advisor in the public and private sector for over 25+ years. He began his career as assistant to the president of the University of Texas M.D. Anderson Cancer Center before relocating to Washington, D.C. where he served as deputy assistant secretary at the Department of Commerce, chief of staff of the President's Commission on Executive Exchange, and White House liaison to the Economic Summit of Industrialized Nations in the Bush 41 Administration. Richard earned his B.S. in Urban Government/ Urban Geography-Planning from the University of Texas at Austin in 1981. He earned his Construction Project Management Certificate in 1984 at the University of Colorado at Boulder. He participated in the certificate program for federal senior executives at the Harvard Kennedy School of Government. Contact Information: rss@competitivetexas.org P: +1.703.608.3000 Texas Infrastructure Council 1510 San Antonio Street Austin, Texas 78701 www.tx-infra.org