Groundbreaking Legislation Set to Kick-Start Californian P3s

03.23.2009
Infrastructure Journal
Nossaman Partner Fredric W. Kessler was quoted extensively by Infrastructure Journal in the story "Groundbreaking Legislation Set to Kick-Start Californian P3s." The story refers to the passage of California Senate Bill 4 (SB 4) into law, permitting the increased use of design-build contracts and permitting P3 toll roads. According to the article "Fred Kessler, a partner at the law firm Nossaman, told Infra-Americas that SB 4 creates the right legal foundation, adding that the challenge now is to identify and procure projects before the authority to enter into lease agreements expires in 2017." Mr. Kessler is quoted as saying, "Caltrans is aggressively working on jump starting its P3 (public-private partnerships) program and identifying suitable projects. Some projects will not be ripe until environmental processes are completed, which can take many years under federal and California law. It really does depend on where projects are, if they are matured enough in terms of environmental issues then they can go ahead."

According to the article, Kessler noted the state's administration was successful in getting this legislation passed in 2009 because it insisted upon it as part of the package for resolving California's budgetary crisis and for stimulating the Californian economy. "I think this legislation is a good, sound legal foundation authorizing P3 procurement and contracting for state and local transportation projects," Kessler said. The statute authorizes both Caltrans and regional transportation agencies to pursue P3 procurements. Kessler said the outcome may very well vary from project to project, but pointed out that state highway authorities appointed Caltrans, which is supportive of P3s, as the public agency responsible for performing project development services. Kessler also said, "Centralization of this responsibility in Caltrans and its consultants will help in the development of uniform standards, requirements and practices for state highway P3 projects. What is clear is that California has a new pipeline with great potential to bring needed transportation projects forward that otherwise could not be delivered for many years, if ever."

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