Colorado Governor backs greater P3 transparency

Governor Hickenlooper kept the transparency provisions of bill SB 14-197 in an executive order he issued, but vetoed the bill because of its negative effect on P3s overall.

While Colorado Governor John Hickenlooper acknowledged the merits of the state senate’s Transportation Enterprise Transparency Act in terms of improving transparency and accountability in public-private partnership (PPP; P3) projects, he was opposed to the constraints the bill would impose on future P3 projects and so vetoed it.

At the same time, however, he issued an Executive Order instructing the High-Performance Transportation Enterprise (HPTE), a division of the Colorado Department of Transportation (CDOT), to adopt additional transparency measures when procuring future P3 projects.

These measures include: holding a minimum of three public town hall meetings for communities affected by a project before issuing a Request for Proposals; considering other alternatives when analysing any surface transportation project that involves toll lanes or managed lanes; and making the essential terms of a P3 agreement available to the public on the HPTE website.

The order also calls for the creation of a Centre of Excellence that would establish P3 best practices, including programmes for ensuring transparency and openness.

“Unfortunately, SB 14-197 is not just a transparency bill – it also inappropriately constrains the business terms of future P3 agreements,” Hickenlooper wrote in his veto letter.

“Senate Bill 14-197 departs from the state’s policy of enabling P3s as a financing alternative. In so doing, it restricts future P3 opportunities by discouraging investment in Colorado, eliminating cost-saving alternatives for delivering core infrastructure, and curbing economic development opportunities,” he continued.

The bill would require future P3s with certain features, such as contract terms longer than 35 years, to be pre-approved by the General Assembly.

Another reason Governor Hickenlooper vetoed the bill was the lack of sufficient involvement of the private sector and local government stakeholders in the bill’s development.

“With legislation of this complexity, it is critical that all stakeholders and partners be actively engaged in a robust and thorough process to ensure good outcomes and good law; we fear that was not the case with SB 14-197,” Hickenlooper wrote in his veto letter.

The proposed legislation was drafted to address public concerns regarding the US 36 Express Lanes/Bus Rapid Transit project, the state’s first P3 project which CDOT and HPTE awarded to Plenary Roads Denver in April 2013 as a 50-year concession.

P3s became an available option for surface transportation projects in 2009, with the enactment of Senate Bill 09-108, which created the High-Performance Transportation Enterprise, putting innovative means of finance at its disposal.