Part One, Part Two and P3: Getting to Public Private Partnerships in Maryland

With school construction needs consistently exceeding available state and local capital funding, many county governments are interested in pursuing public-private partnerships in school construction. This issue was the subject of a panel discussion moderated by Anne Arundel County Councilman Jerry Walker during MACo’s School Construction Symposium, which was held on June 30 at Rolling Hills Elementary School in Annapolis.

Lease-leaseback, sale-leaseback, design-build arrangements, and performance-based contracting are allowed under state law, but have been infrequently used. In this Session, panelists described successful examples of P3 high school construction in Maryland, along with sharing ideas for using energy-saving-value-capture models and asset-leveraging P3 school construction throughout Maryland.

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An historic theater becomes a high school through a P3 partnership in Hagerstown, Washington County.

Clayton Wilcox, Superintendent of Washington County Public Schools described the successful P3 school partnership used to create the Barbara Ingram School for the Performing Arts in Hagerstown. He spoke about state tax credits available for the project, which renovated a historic structure for the high school’s use. He shared the multiple public-side partners in the effort, including the:

  • Superintendent of Washington County Public Schools
  • Washington County Board of Education
  • Board of CountyCommissioners of Washington County
  • City of Hagerstown

Next, Samuel Ketterman, Senior Vice President of Davenport & Company LLC spoke about the possible structures for P3 partnerships in school construction in Maryland, including a sale-leaseback model. He referenced the relatively low costs of financing and the demand for Maryland debt.

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A shift to a P3 development structure could hold cost-savings for local governments, according to Tim Toohey of Corvias.

Tim Toohey, SVP Operations of Corvias Solutions shared the benefits of a P3 partnership based on his firm’s work in Maryland and nationwide. In a P3, he noted, the responsibility for the design, build, maintenance and operation of a structure is the responsibility of the private sector while the government achieves its mission.

Toohey described how Corvias often uses small local contractors in P3 projects, providing local economic opportunities. Contractors who may not approach a government project would work with private developers, he said, as private developers can guarantee fast payment and provide back office support for small shops. He also shared how the private sector would use an “at-risk” model, common to the development sector, rather than the government “feasibility study” model.

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Through its mission, the Maryland Clean Energy Center can facilitate energy performance contracting in Maryland schools.

To complete the session, Wyatt Shiflett, Director of Financing Programs at the Maryland Clean Energy Center described how the Center brings capital to green projects, and helps coordinate energy projects that are self-funded through savings.

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