By Craddick H.B. No. 3102
75R2531 BEM-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to partnerships between public and private entities for
1-3 the development of infrastructure systems and facilities.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subtitle G, Title 10, Government Code, is amended
1-6 by adding Chapter 2310 to read as follows:
1-7 CHAPTER 2310. PUBLIC-PRIVATE INFRASTRUCTURE PARTNERSHIP ACT
1-8 SUBCHAPTER A. GENERAL PROVISIONS
1-9 Sec. 2310.001. DEFINITION. In this chapter "infrastructure
1-10 systems or facilities" means capital-related improvements and
1-11 additions to state or local transportation and environmental
1-12 infrastructure, including highways, roads, bridges, marine-related
1-13 facilities, vehicles, equipment, park and ride lots, transit
1-14 stations, airports or other aviation facilities, infrastructure
1-15 management systems, water treatment facilities, wastewater
1-16 treatment facilities, solid waste facilities, and other
1-17 infrastructure-related investments.
1-18 Sec. 2310.002. RIGHTS AND POWERS OF PUBLIC ENTITY. (a) This
1-19 chapter may not be construed to limit the right of a public entity
1-20 to render advice relating to the negotiation and development of an
1-21 agreement under this chapter that is in the best interests of the
1-22 state and the public.
1-23 (b) A public entity may exercise any of the entity's powers
1-24 to facilitate the development, construction, financing, operation,
2-1 or maintenance of an infrastructure system or facility under this
2-2 chapter.
2-3 (Sections 2310.003-2310.020 reserved for expansion)
2-4 SUBCHAPTER B. PROJECTS TO DEVELOP, OPERATE, OR MAINTAIN
2-5 INFRASTRUCTURE SYSTEMS AND FACILITIES
2-6 Sec. 2310.021. PROJECT SELECTION. (a) A public entity may
2-7 solicit a proposal from, or negotiate and enter into an agreement
2-8 with, one or more private entities to undertake, in conjunction
2-9 with the public entity or another public entity, a project that
2-10 consists of all or a part of the study, planning, design,
2-11 construction, operation, or maintenance of an infrastructure system
2-12 or facility, using wholly or partly private sources of financing.
2-13 (b) Each proposed project shall be weighed on its own
2-14 merits, and each agreement must be negotiated individually.
2-15 (c) A project may be selected at the discretion of the
2-16 public and private entities.
2-17 (d) A public entity may consult with legal, financial, or
2-18 other experts in the negotiation and development of an agreement.
2-19 Sec. 2310.022. PROJECT AGREEMENT. (a) An agreement entered
2-20 into under Section 2310.021 must provide for private ownership of a
2-21 project during the construction period.
2-22 (b) After completion and on final acceptance of a project or
2-23 project segment by the public entity, the agreement must provide
2-24 for public ownership of the infrastructure system or facility to
2-25 which the agreement relates to be leased to the private entity
2-26 unless the public entity elects for ownership of the system
2-27 facility to reside in the private entity during the term of the
3-1 agreement.
3-2 (c) For the purpose of facilitating projects and to assist
3-3 the private entity in the financing, development, construction, or
3-4 operation of a project, the agreement may:
3-5 (1) authorize the public entity to lease facilities,
3-6 rights-of-way, and airspace, including airspace next to, above, or
3-7 below the right-of-way associated with the private entity's
3-8 infrastructure system or facility;
3-9 (2) provide for the public entity to exercise the
3-10 power of eminent domain;
3-11 (3) provide for the public entity to negotiate
3-12 acquisition of rights-of-way in excess of appraised value;
3-13 (4) provide protection from competition;
3-14 (5) provide remedies in the event of default of either
3-15 of the parties;
3-16 (6) grant the public entity:
3-17 (A) contractual and real property rights;
3-18 (B) development rights and opportunities; and
3-19 (C) necessary easements and rights of access;
3-20 (7) provide for issuance of permits and other
3-21 authorizations by the public entity;
3-22 (8) authorize the public entity to lease existing or
3-23 subsequently acquired rights-of-way with public or private
3-24 financing; and
3-25 (9) contain other provisions considered necessary by
3-26 the public entity.
3-27 (d) An agreement may include any contractual provision that:
4-1 (1) is necessary to protect project revenues required
4-2 to repay the costs incurred in connection with the project or to
4-3 enforce laws; and
4-4 (2) will not unreasonably inhibit or prohibit the
4-5 development of additional infrastructure systems or facilities.
4-6 Sec. 2310.023. REIMBURSEMENT OF PUBLIC EXPENDITURES. (a) An
4-7 agreement for maintenance services entered into under this chapter
4-8 must provide for reimbursement, either in cash or in kind, to the
4-9 public entity for services rendered by the public entity.
4-10 (b) An agreement for police services relating to a project
4-11 may be entered into with a qualified law enforcement agency and
4-12 must provide for reimbursement, either in cash or in kind, for
4-13 services rendered by the law enforcement agency.
4-14 (c) A public entity may provide other services relating to a
4-15 project for which it shall be reimbursed including preliminary
4-16 planning, environmental certification, and preliminary design.
4-17 Sec. 2310.024. LEASING OF INFRASTRUCTURE PROJECTS. The
4-18 lease of a project or project segment to a private entity for
4-19 operating purposes may be for a maximum term of 50 years.
4-20 Sec. 2310.025. COMPLIANCE WITH STANDARDS UPON REVERSION TO
4-21 PUBLIC ENTITY. On reversion of a project to the public entity or
4-22 at the end of a lease term, as applicable, the project must comply
4-23 with all applicable standards reasonably established by the public
4-24 entity and provided in the agreement. The agreement must contain a
4-25 provision that addresses responsibility for any reconstruction or
4-26 renovations that may be required for a project to meet those
4-27 standards.
5-1 Sec. 2310.026. AIRSPACE RIGHTS. (a) In consideration for a
5-2 reversion right in a privately constructed project, the public
5-3 entity may negotiate a reduced charge for the lease of airspace
5-4 rights to the private entity during the term of the agreement.
5-5 (b) If, after the expiration of the agreement, the public
5-6 entity continues to lease airspace rights to the private entity, it
5-7 shall do so at fair market value.
5-8 (c) The agreement may also provide the private entity the
5-9 right of first refusal to undertake a project using airspace owned
5-10 by the public entity in the vicinity of the project.
5-11 Sec. 2310.027. TRANSPORTATION FACILITY. A state
5-12 transportation facility constructed by and leased to a private
5-13 entity is considered to be a part of the state highway system for
5-14 purposes of identification, maintenance, and enforcement of traffic
5-15 laws and for the purposes of other applicable statutes.
5-16 Sec. 2310.028. CONSTRUCTION AND OTHER STANDARDS. (a) The
5-17 plans and specifications for a project constructed under this
5-18 chapter must comply with the public entity's standards for a
5-19 similar public project, as adjusted to accommodate innovative
5-20 techniques.
5-21 (b) A project designed, constructed, or operated under this
5-22 chapter must comply with all applicable law.
5-23 Sec. 2310.029. LIABILITY. (a) An agreement entered into
5-24 under Section 2310.021 must:
5-25 (1) specifically provide for the apportionment of
5-26 liability between the public entity and the private entity during
5-27 construction of a project and during the term of the lease; and
6-1 (2) include provisions requiring the private entity to
6-2 purchase and maintain liability insurance coverage in amounts
6-3 appropriate to protect the project's viability during construction
6-4 and during the term of the lease.
6-5 (b) An agreement may address the public entity's insurance
6-6 requirements for design and construction liability if the public
6-7 entity has approved project design and construction plans.
6-8 (Sections 2310.030-2310.040 reserved for expansion)
6-9 SUBCHAPTER C. FINANCING AND REVENUES
6-10 Sec. 2310.041. PROJECT FINANCING AND RELATED SERVICES. (a)
6-11 A public entity may use federal and public entity financing in
6-12 connection with a project, including grants, loans, and other
6-13 financial measures authorized by federal and state law. A public
6-14 entity may take the action necessary and desirable to maximize
6-15 funding for and financing of a project, including the formation of
6-16 a revolving loan fund to implement this section.
6-17 (b) An agreement entered into using the powers provided by
6-18 this section:
6-19 (1) must determine the public entity's maximum rate of
6-20 return on investment based on project characteristics; and
6-21 (2) may provide for incentive rates of return in
6-22 excess of the maximum rate of return provided in the agreement.
6-23 (c) The incentive rates of return must be designed to
6-24 provide financial benefits to the public entity and the private
6-25 entity given the attainment of various safety, performance, or
6-26 infrastructure demand management goals.
6-27 Sec. 2310.042. TOLLS AND FEES. (a) An agreement entered
7-1 into under Section 2310.041 must authorize the private entity to
7-2 lease the facilities within a designated area or areas from the
7-3 public entity and to impose user fees or tolls within the
7-4 designated area to allow a reasonable rate of return on investment,
7-5 as provided by the agreement.
7-6 (b) An agreement must require that, over the term of the
7-7 ownership or lease, the user fees or toll revenues be applied to:
7-8 (1) payment of the private entity's capital outlay
7-9 costs for the project, including interest expense;
7-10 (2) payment of the facility's operation costs;
7-11 (3) collection of user fees or toll revenues;
7-12 (4) payment of facility maintenance and administration
7-13 costs;
7-14 (5) reimbursement to the public entity for project
7-15 review and oversight, law enforcement, or technical services costs;
7-16 (6) establishment of a fund to insure adequate
7-17 maintenance expenditures; and
7-18 (7) reasonable investment returns for the private
7-19 entity.
7-20 (c) An agreement may provide for the use of excess toll
7-21 revenues or user fees.
7-22 (d) After expiration of the lease of the facilities to a
7-23 private entity, the public entity may continue to charge user fees
7-24 or tolls for the use of the facilities. Revenues from the user
7-25 fees or tolls shall be used to pay for operations and maintenance
7-26 of the facility, to pay local agencies, or for a combination of
7-27 those uses.
8-1 SECTION 2. The importance of this legislation and the
8-2 crowded condition of the calendars in both houses create an
8-3 emergency and an imperative public necessity that the
8-4 constitutional rule requiring bills to be read on three several
8-5 days in each house be suspended, and this rule is hereby suspended,
8-6 and that this Act take effect and be in force from and after its
8-7 passage, and it is so enacted.