Environmental Services Public-Private Partnership Act Exposed

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The Environmental Services Public-Private Partnership Act was adopted by the ALEC Energy, Environment and Agriculture Task Force and was included in ALEC's 1995 Sourcebook of American State Legislation. According to ALEC.org, the Act was approved by the Board of Directors in 1995, re-approved on January 28, 2013. (Accessed on 6/26/2015).

CMD's Bill Summary

This legislation privatizes public water and sewage services and would prohibit local governments from requiring that contractors meet labor and wage standards. Most efforts at privatizing water/sewage have resulted in increased rates, poor customer service, and environmental damage. This bill also prohibits local governments from requiring the use of union labor or that contractors pay the prevailing wage.

ALEC Bill Text


Provides an arrangement through which government utilizes the private sector to produce goods and services that would otherwise be provided or funded completely by government.

Model Legislation

Section 1. {Title}

This Act may be cited as the Environmental Services Public-Private Partnership Act.

Section 2. {Definitions}

As used in this Act:

(A) “Call for competition” means a request for proposals, invitation for bids or request for competitive negotiations.

(B) “Cost” means with respect to any public-private partnership project of facility related thereto:

(1) All costs of designing, planning, acquiring, constructing, reconstructing, modifying, furnishing and placing in service any project, including architectural, planning, engineering, legal and fiscal advisors’ fees or costs and any costs incident to the acquisition of any necessary property, easement or right-of-way.
(2) Any costs incurred for preliminary planning to determine the economic or engineering feasibility of a proposed project, including, without limitation, costs of economic investigation and studies, surveys, preparation of designs, plans, working drawings, specifications and inspection and supervisions of the construction of any facility;
(3) All costs incident to the purchase, installation, or financing of equipment, machinery, and other personal property required by project;
(4) All costs incident to the authorization and issuance of bonds, including accountants’ fees, attorneys’ fees, financial advisors’ fees, underwriting fees (including bond discount) and other professional services and printing costs;
(5) All costs incident to the establishment and funding of appropriate reserve funds; and
(6) Interest estimated to accrue on any bonds issued for temporary initial financing for any project for a reasonable time prior to construction, during and for a reasonable period of time after construction.

(C) “Infrastructure projects” are projects for the acquisition, development, design, construction, expansion and/or improvement of facilities to provide wastewater treatment, drinking water treatment and solid waste management systems, and all improvements related to any of the foregoing.

(D) “Infrastructure services” is the provisions of wastewater, drinking water, and solid waste management systems or services which shall include, but are not limited to, financing, design, construction, operation, maintenance, supply and distribution services or any and all components thereof.

(E) “Inherent public prerogative” is the authority of a political subdivision to determine whether infrastructure projects or infrastructure services should be produced by the employees of the political subdivision, or otherwise made, leased, contracted for, or purchased through a competitive process on either a temporary or permanent basis.

(F) “Political subdivision” is a city, county, town, special district or water or sewer authority, or any agency or authority of any of the foregoing constituting a political subdivision under state law, or any or all of the aforementioned acting jointly or by agreement. (As an alternative or an adjunct to this list, a special political subdivision could be authorized, solely to undertake transactions authorized under this act.)

(G) “Private contractor” means any natural person, corporation, partnership, trust, etc.

(H) “Proposal” means the response of a proposer to a call for competition.

(I) “Public-Private partnership” means the competitive procurement if infrastructure projects or infrastructure facilities.

Section 3. {Authority}

(A) All political subdivisions shall have the authority to singly or in concert with other political subdivisions procure and/or provide any one or more infrastructure services for any infrastructure project by means of contracting with a private contractor pursuant to this act.

(B) A political subdivision shall have the authority to bargain collectively with regard to any matter of inherent public prerogative and shall have no authority to execute or renew any collective bargaining agreement that contains provisions.

(C) No arbitrator or arbitration panel shall have the authority to impose any labor contract, labor contract provisions to any other order concerning any matter of inherent public prerogative.

(D) A political subdivision which intends to enter into a contract with a private contractor for the provision of an infrastructure project or infrastructure service pursuant to the provisions of this act shall publish notice of its intention in at least one newspaper of general circulation in the subdivision which would be served under the terms of the proposed contract.

(E) A political subdivision shall have the authority to sell capital facilities and capital equipment to private persons for use in infrastructure projects and infrastructure services, consistent with the public interest.

Section 4. {Planning}

(A) A political subdivision shall routinely and objectively consider public-private partnership for infrastructure projects or infrastructure services where:

(1) An infrastructure facility is to be developed or improved.
(2) A new or expanded infrastructure service is to be provided.

(B) A political subdivision shall objectively consider unsolicited proposals from private contractors for provision of infrastructure services. Upon completion of such con