Authored Articles & Publications Aug 17, 2015

New Law Promotes Social Infrastructure P3 in a California City

By Seth Merewitz

SB 562 is a special law intended to clarify procedures that will allow the City of Long Beach to move forward with its new Civic Center project. Signed by Gov. Jerry Brown on Aug.11, this law provides the City with discretion on its procurement process similar to the Government Code section 5956 legislation that applies to fee-producing infrastructure.

Pursuant to the new law, the City may contract and procure the project, which is found to be “providing the best value in meeting the best interests of the city.” “Best interests of the city” is defined as a procurement process that is determined by the city to provide the best value and an expedited delivery schedule, while maintaining a high level of quality workmanship and materials. “Best value” means a value determined by objective criteria that includes a combination of price, financing costs, features, functions, performance, life-cycle maintenance costs and abatement offsets, and development experience.

The law also authorizes the City to enter into a public-private partnership through a concession agreement, design-build agreement, design-build-finance agreement, project agreement, lease-leaseback, or other appropriate agreements combining one or more major elements of the foregoing agreements. Projects are still subject to CEQA, California Public Records Act, Political Reform Act and State Prevailing Wage laws.

The Long Beach Civic Center is arguably the most important P3 project in California, as it has the potential to use a P3 project delivery method in a major California city, unlike most of the P3 projects to date.

Note: This article originally appeared on the now-defunct BBKnowledge blog, where Best Best & Krieger authors shared their knowledge on emerging issues in public agency law.

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