Kentucky Senate approves PPP bill

A Kentucky House of Representatives initiative to authorise the private financing, construction and operation of large infrastructure projects through PPPs passed through the State Senate last week, clearing the way for Governor Matt Bevin to sign the proposed bill into law.

House Bill 309 was introduced by Representative Leslie Combs on 27 January, passing through the House of Representatives with an 83-11 vote on 11 February. On 25 March, it passed through the Senate with 86 in favor and eight against. Following Senate approval, the bill was returned to the House where all updates and changes were approved.

“Today's Senate vote – and the expected final approval in the House of some minor changes – means that Kentucky is about to get a power economic development tool that will maximise our tax dollars, give us a chance to take on projects that could only be dreamed about and to do it all in a way that is transparent and accountable to the public,” Combs said in a statement following the vote.

Combs sees the bill as being particularly beneficial to the transportation sector, where she said the state “can no longer rely on the federal government for major projects and there are limits to what we can do on the state level without putting pressure on other projects”.

To that end, the bill creates a Kentucky Public Transportation Infrastructure Authority to review, approve and monitor state PPP projects. The authority's primary purpose is to oversee projects entering into bi-state agreements. The legislation specifically notes that neither it nor any specially created bi-state authorities are allowed to enter into PPPs with the State of Ohio unless the General Assembly expressly authorises it through a joint resolution. 

“By partnering with the private sector,” Combs said, “we will have another opportunity to move forward like other states that are already doing.” 

A prior attempt to pass PPP-authorising legislation was passed through the Kentucky General Assembly in 2014, but was then vetoed by former Governor Steve Beshear, who said at the time that existing provisions for non-transportation PPPs and a prohibition in the 2014 against entering into PPPs with the state of Ohio prompted his disapproval.

Contrary to Beshears, Bevin announced in February that banning tolls for Ohio-linked PPPs – particularly the Brent Spence Bridge project – will not stop him from signing the bill. In a statement at the time, spokesperson for the governor Jessica Ditto told local affiliates of the USA Today Network that “he looks forward to the opportunity to sign a P3 bill, provided adequate safeguards remain to protect taxpayers”.