Public Private Environmental Partnerships. Jeff Hughes (919)

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1 Public Private Environmental Partnerships Jeff Hughes (919)

2 Helping communities provide environmental programs and services in fair, effective, and financially sustainable ways through: Applied Research Teaching and Outreach Program Design and Evaluation How you pay for it matters 2

3 Introductions Name, Organization Example and 3 sentence description of a Notable Environmental Finance Partnership you have been involved in (or want to be involved in) with a Governmental and Non-Governmental Entity

4 Workshop Objectives Share experiences concerning public private partnerships Identify appropriate financing tools for crafting environmental public private partnerships Identify challenges and strategies for promoting public private partnerships.

5 Agenda 1) Overview of financing tools for creating partnerships 1) Stormwater 2) Solid Waste 3) Water and wastewater infrastructure 4) Energy 2) New Belgium Brewery 1) Stormwater 2) Greenways 3) ReVenture 1) Brownfields 2) Land conversion 3) Clean energy 4) Procurement and legal options 1) New construction 5) Additional Resources

6 FINANCING TOOLS FOR CRAFTING ENVIRONMENTAL PUBLIC PRIVATE PARTNERSHIPS

7 What is an Environmental Public- Private Financial Partnership Definition for the workshop: Governmental unit and nongovernmental/private sector entity working together with each bringing their own set of assets and abilities to achieve a community environmental goal.

8 Public Private Partnerships: Narrower Definitions Statutory procurement method Private sector acquisition or ownership of an asset related to service that had been previously provided by government sector: Toll Roads Water Systems

9 Tapping into Strategic Advantages Sticky Note: A private company is able to better/easier than a governmental entity. Sticky Note: A governmental entity is able to better/easier than a private company.

10 Governing Legal Framework Parking Lot Questions Are we allowed to? What steps do we need to follow to? Where in the statutes does it say we can?

11 Financing Tools for Creating Environmental Partnerships 1. Fee for service models 2. Fee relief for service 3. Franchise agreements 4. Tax incentives 5. Assessments 6. Project development finance/tax Increment Finance 7. Synthetic TIFs 8. Property leasing and potential sales 9. Asset leasing 10. Guaranteed Energy Savings Agreements 11. Fee for construction/asset 12. Qualified Energy Conservation Bonds

12 Tool Franchise Agreements What it does Allow city or county to direct how services are provided in their jurisdiction. (Recycling, Landfill) Environmental Public Private Finance Tools Assessments Allows city or county to attach the cost of an environmental improvement to a private property owner. Tax increment finance/project development finance Land Lease with Purchase Right Leasing Energy Savings Contract Public Private Partnership Construction Brownfields Agreement Allows a city or county to tap into increased property tax arising from development to help pay for environmental improvements Allows local government to use property for an environmental project and facilitate eventual ownership of environmental asset (energy projects) Allows local government to benefit from environmental project without having to invest in initial capital Allows local government to use a guaranteed savings stream from specially procured water or energy projects to pay off the debt for those projects. Allows a local government to share financing and construction responsibility with a private entity. Allows government to transfer key elements of liability risk from contaminated property allowing developers to have better access to capital and improve property Developer incentives Qualified Energy Conservation Bonds Provides financial incentives to a developer in order to incentive the addition of environmental assets. Financing mechanism to allow allocation of a public tax incentive to a private entity.

13 Fee for Service For services local governments are authorized to provide Construction (This afternoon) Service Water Wastewater Trash Collection Consumer education

14 P3 in the News

15 Public Private Partnership in the News Prince Georges County Stormwater

16 Prince Georges County Improve Chesapeake Water Quality Meet regulatory requirements Begin work on public property with eventual work on private property Incentives for performance targets Streamlined work coordination by private sector Manager Funded by payments from County

17 Maplewood Mall Project 35 acres of parking lot impervious 70 acres including building 55 Rain gardens 375 Trees in Trenches 5700 Gallon Cistern Sand Filters Pervious Pavers Educational Signage Slide Source: Cliff Aichinger, RWMWD

18 PFA TMDL Implementation Grant 19% Maplewood Mall Project District Levy 31% PFA Clean Water Revolving Fund Grant 6% MPCA 319 Grant 8% BWSR Clean Water Fund Grant 18% Slide Source: Cliff Aichinger, RWMWD PFA SRF Loan 18%

19 Durham Slide Source: Laura Webb-Smith, City of Durham

20 Slide Source: Laura Webb-Smith, City of Durham

21 Slide Source: Laura Webb-Smith, City of Durham

22 Environmental Revolving Loans? Energy efficiency Housing Economic development

23 Fee Relief for Service? Reduced stormwater fees Reduced water bills Reduced energy bills

24 Special Assessments Water or wastewater service Stormwater/watershed improvement projects No petition required (public hearings required) 10 years, 8% For more information:

25 Newer Special Assessments (Expire June 30, 2015) Expanded purposes Can be used to back debt Requires petition 30 years For more information: For an example (the only use as of December 2014)

27 Synthetic Tax Increment Financing Debt legally backed by asset, revenue stream, or general obligation pledge Intention to generate enough money from increased taxes linked to increased valuation of improved properties For more information:

28 Municipal Service District Combined with Private Contract Durham BID

29 Additional SOG Resources Norma Houston Kara Millonzi Tyler Mulligan Adam Lovelady Development Finance Initiative Environmental Finance Center

Innovative Financial Strategies for Stormwater Programs

Innovative Financial Strategies for Stormwater Programs Preconference Workshop: Southeast Stormwater Association 08/08/14 Stacey Isaac Berahzer, Senior Project Director Environmental Finance Center at