Council of the District of Columbia Passes Public-Private Partnership Bill
On December 2, the Council of the District of Columbia voted unanimously to pass B20-0595, the “Public-Private Partnership Act of 2014.” The District of Columbia has been able to deliver several infrastructure projects through public-private partnerships (P3s) in the past, but these required special legislation. The District is one of several jurisdictions that does not have outright P3 authority.
This bill would establish an Office of Public-Private Partnerships for the District that would streamline delivery of P3s. The bill was introduced in December 2013 by DC Mayor-elect Muriel Bowser and by Councilman David Grosso and has been slow in making its way through the Council’s legislative process. As originally drafted, bonds on P3 projects would have been discretionary and other forms of security would have been accepted. The Surety and Fidelity Association of America was able to work with the Council and its staff, who ultimately amended the language. The bill now directly references the DC Code Title VII, “Bonds and other Forms of Security” of the Procurement Practices Reform Act of 2010. An excerpt of that section of the Code is as follows:
Contract performance and payment bonds in construction contracts.
(a)(1) When a construction contract is awarded in excess of $100,000, the following bonds or security shall be delivered to the District and shall become binding on the parties upon the execution of the contract:
(A) A performance bond satisfactory to the District, executed by a surety company authorized to do business in the District or otherwise secured in a manner satisfactory to the District, in an amount equal to 100% of the portion of the contract price that does not include the cost of operation, maintenance, and finance; and
(B) A payment bond satisfactory to the District, executed by a surety company authorized to do business in the District or otherwise secured in a manner satisfactory to the District, for the protection of all persons supplying labor and material to the contractor or its subcontractors for the performance of the construction work provided for in the contract.
(2) The payment bond required by paragraph (1)(B) of this subsection shall be in an amount equal to 100% of the portion of the contract price that does not include the cost of operation, maintenance, and finance.
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Lame duck Mayor Vincent Gray is not expected to veto the bill. A copy of the bill can be found at the Council’s website or by clicking
here: http://lims.dccouncil.us/Download/30744/B20-0595-Amendment1.pdf. The reference to Title VII can be found at page 19.
For more information, contact Shannon Crawford, NASBP Manager of State Relations at 202.464.1170 or
scrawford@nasbp.org.