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Office of Public Finance

Public Private Partnership (P3)

About

On August 14, 2018 Governor Murphy signed P.L. 2018, c.90 (S-865) into law. The program allows a school district, college or university, municipality, county or other state entity to enter into an agreement with a private organization that would assume the financial and administrative responsibility for the development, construction, reconstruction, repair, alteration, improvement, extension, operation, and maintenance of a government-related project. The P3 project is financed in whole, or in part, by the private organization.

The law requires local public input and finance controls, as well as land use and financial approvals, should a municipality, county, or school district pursue a P3 project. If the agreement includes the lease of a public building, road, infrastructure, or facility in exchange for up-front or structured financing by the private entity, the term of the lease may not be for a period greater than 30 years.

The law also requires that workers employed in the construction, rehabilitation, or building maintenance services of a project be subject to the applicable provisions of the "New Jersey Prevailing Wage Act;" that building construction projects contain a project labor agreement; and that the general contractor, construction manager, design-build team, or subcontractor for a project be registered and classified by the State to perform work on a project.

Project Review Process

The law tasks the Department of the Treasury with coordinating the review and approval of proposed P3 projects. The review includes an analysis by a P3 advisor selected from a pool of qualified P3 specialists that have been vetted by the Office of Public Finance. Projects are reviewed in coordination with several sister agencies and entities. The review committee for each project category is listed below:

Local Government
  • Department of the Treasury
  • Department of Community Affairs
  • N.J. Economic Development Authority
  • Department of Transportation (where a transportation element is under consideration)
School District
  • Department of the Treasury
  • Department of Education
  • Schools Development Authority (as appropriate)
  • N.J. Economic Development Authority
  • Department of Transportation (where a transportation element is under consideration)
State Government Entity
  • Department of the Treasury (including the Division of Property Management and Construction)
  • N.J. Economic Development Authority
  • Department of Transportation (where a transportation element is under consideration)
College / Universities
  • Department of the Treasury
  • Office of the Secretary of Higher Education
  • Educational Facilities Authority (as appropriate)
  • N.J. Economic Development Authority
  • Department of Transportation (where a transportation element is under consideration)

Reporting

Treasury must provide information on the status of each P3 agreement on its website. Each project will be designated as ‘proposed,’ ‘under review,’ or ‘active public-private partnership project.’

Current Status

Treasury is in the process of developing regulations to support the implementation of the new law. Support materials will soon be made available to individuals and stakeholders considering a P3 project.

Applying

Entities should prepare the following items before applying:

  • A description of the project, its purpose and why it is needed (including references to the impacted public partner units and public partner units that identify this need);
  • A justification for why the P3 delivery method is advantageous;
  • Estimated costs and financial documentation for the project showing the underlying financial models and assumptions that determined the estimated costs, including a long-range maintenance plan;
  • An analysis of all available funding options for the project, including an analysis of the financial viability and advisability of the project, along with evidence of the public benefit in advancing the project as a public-private partnership;
  • A performance monitoring plan for the agreement if entered into;
  • Documentation of the public vetting of the project, including applicable hearings and, where relevant, a resolution by the governing body;
  • Information on experts retained as well as their qualification and industry experience.

*Formal application materials will be made available in the coming days.

Resources

Contact us:

  • State of New Jersey P3 Analysis
  • c/o Office of Public Finance
  • 50 West State Street (One State Street Square)
  • Trenton, NJ 08625
  • Phone: 609.984.4888
  • Email: P3@treas.nj.gov

Last Updated: Monday, 06/17/19