On July 10, 2019, Missouri Governor Mike Parson signed legislation that permits state universities to use public-private partnerships (also known as “P3s”) to deliver projects on their campuses. Specifically, the law will allow a higher-education institution to enter into “a long-term concession with a private developer to construct, operate, maintain, and finance the project in exchange for annual payments subject to abatement for nonperformance.”[i]
Around the nation, public universities have been turning more and more to the private sector to design, build, finance, operate, or maintain various projects. P3s have allowed state colleges to build, renovate, or maintain student housing, utility systems, academic halls, and student centers in an expeditious and efficient manner. Up to now, the State of Missouri lacked express statutory permission for use of P3s for university projects. While P3s are not unheard of on Missouri campuses, the delivery of large-scale projects through P3s at state universities has undoubtedly been curtailed because of their uncertain legal status.
The passage of this legislation, however, now gives a green light to university officials and private-sector financiers, developers, and operators to pursue P3 arrangements when they make sense from fiscal and operational standpoints. The new law goes into effect on August 28, 2019.
This year’s action on P3s for state universities comes after the legislature in 2018 expanded the opportunities for public-private partnerships for municipal infrastructure projects. That was the subject of an earlier blog post.
For more information, contact Kevin Corlew.
[i] HB 1088, Section 174.345 (2019).