- Associated Press - Thursday, March 24, 2016

FRANKFORT, Ky. (AP) - A bill backed by business groups to authorize use of public-private partnerships for mega-dollar transportation work and other projects won Kentucky Senate approval on Thursday.

The vote potentially leaves the measure one step away from reaching Gov. Matt Bevin’s desk.

The proposal would sanction ventures partnering state and local governments with private sources. As part of the arrangements, a private entity could construct, finance or even operate a facility under terms of its contract with the government partner.

During the Senate debate, supporters said the public-private option would jump-start big-ticket projects that state or local governments alone can’t afford in tight budgetary times.

The Senate’s 29-9 vote sends the measure back to the House. The bill’s lead sponsor later said she will urge her House colleagues to accept Senate changes and send the measure to Bevin.

“Over the long term, I think this legislation has the potential to be one of the most far-reaching laws we have passed in quite some time,” said Rep. Leslie Combs, D-Pikeville.

Combs has promoted the so-called “P3” legislation for four years, with support from the Kentucky Chamber of Commerce and other business groups.

She said Thursday the public-private partnerships would be “a powerful economic development tool” that would allow Kentucky to “take on projects that could only be dreamed about.”

The partnerships also would spur projects by local governments, supporters said.

“Our communities … are begging for ways that they can take care of themselves,” said Sen. Danny Carroll, R-Paducah. “This is a way that that can happen.”

State parks also could benefit from an infusion of private financing for improvements, supporters said.

Opponents warned the partnerships would result in government abdicating some of its basic responsibilities to private sources, at the potential detriment to taxpayers.

“In order to have a public-private partnership, you have to have a profit,” said Sen. Wil Schroder, R-Wilder. “And make no mistake about it, the people of Kentucky will pay more with ‘P3’ legislation.”

Sen. Robin Webb, D-Grayson, warned that the agreements could result in “contractual constraint” for participating governments “that could tie our hands for decades.”

“What are we giving away in this process?” she asked.

Sen. Max Wise, R-Campbellsville, who shepherded the bill through the Senate, said the bill includes safeguards ensuring state oversight and public transparency of public-private partnerships.

For the state, there would be required public postings of proposed agreements, hearings and legislative oversight. No project costing $25 million or more could be done without the General Assembly’s authority.

Local governments would largely mirror the same process as the state, and there would be added oversight with the creation of a Kentucky Local Government Public-Private Partnership Board. It would evaluate and approve “P3” agreements that have a value worth 30 percent or more of the local government’s general revenues. Also, the state auditor’s office would have authority to review local “P3” agreements.


The legislation is House Bill 309.

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