Determining a Competitive Contract Bid Price for Public-Private Partnerships

What are public-private partnerships?

Public-private partnerships (P3s) are collaborative agreements between government entities and private-sector businesses. These partnerships aim to leverage the expertise and resources of both sectors to achieve public goals more efficiently and effectively. In Florida, public-private sector partnerships often intersect with real estate law, business law, and government relations.

A notable example of a public-private sector partnership in Florida is the Miami Intermodal Center (MIC). This transportation hub, developed through a collaboration between the Florida Department of Transportation (FDOT) and private companies, combines various modes of transportation, including buses, rental cars, and Metrorail. The MIC exemplifies how public-private partnerships can enhance public infrastructure and stimulate economic development in the state.

Need help facilitating opportunities in the public sector? Schedule your consultation today with a top public-private partnership attorney.

Which Florida laws, rules, and regulations apply to public-private partnerships?

Florida Statutes Section 255.065 and Section 334.30 establish the framework for public-private partnerships for public and transportation facilities, respectively. These statutes outline the procedures for soliciting, receiving, and evaluating proposals for P3s and the criteria for selecting private entities.

Additionally, agencies like the Florida Department of Transportation (FDOT) guide public-private partnerships, including this reference guide. Moreover, local governments like Miami-Dade County often provide more specific guidelines for P3s.

Understanding and adhering to these state and local laws, rules, and regulations is crucial for successfully implementing public-private partnerships in Florida.

How does contract bidding connect to public-private partnerships?

Due diligence and cost analysis help businesses prepare competitive bids for P3s and ensure that the parties involved understand the potential risks and rewards of the partnership. Preparing a competitive bid for a public-private partnership (PPP) project involves comprehensive due diligence and cost analysis. The exact nature and extent of these activities will depend on the specific project, but here are some of the critical areas that private entities typically need to consider:

• Market Analysis: The private entity should thoroughly analyze the market to determine the potential demand for the project by studying demographic trends, economic indicators, and similar projects elsewhere. This analysis will help the private entity to forecast revenues and understand the potential risks and opportunities in the market.
• Technical Feasibility: Feasibility studies assess whether the project is achievable with current technology and within the proposed timeline. These studies might involve consulting engineers, architects, and other technical experts. The private entity should also assess the condition of any existing infrastructure and the need for upgrades or replacements.
• Legal and Regulatory Due Diligence: The private entity should examine the legal and regulatory environment to ensure the project is legally feasible and understand the potential risks and obligations. Private entities can accomplish this by consulting with lawyers and regulatory experts, reviewing relevant laws and regulations, and assessing the potential for changes in the legal or regulatory environment.
• Financial Analysis: The private entity should conduct a detailed financial analysis to estimate the project’s costs and potential revenues via a detailed budget, a cash flow forecast, and a financial model considering different scenarios and risks. The financial analysis should also consider the potential for financing the project, including the availability of loans, grants, or other funding sources.
• Risk Assessment: The private entity should identify and assess the potential market, technical, regulatory, and financial risks associated with the project. The risk assessment should consider each risk’s likelihood and potential impact and develop strategies for managing or mitigating these risks.
• Environmental and Social Impact Assessment: The private entity should assess the project’s potential ecological and social impacts by consulting with environmental experts, conducting environmental studies, and engaging with local communities and stakeholders.
• Operational Planning: The private entity should develop a detailed operational plan that describes how the project will be managed and maintained. Operational plans often encompass staffing, maintenance schedules, and other day-to-day details. The operational plan should also consider potential operational risks and develop strategies for managing these risks.
• Contractual Due Diligence: The private entity should closely review the terms of the proposed PPP agreement, including the allocation of risks and responsibilities, payment mechanisms, performance standards, and termination provisions.

By conducting thorough due diligence and cost analysis, the private entity can develop a competitive bid that accurately reflects the costs and potential benefits of the project, manages risks effectively, and aligns with the needs and expectations of the public partner.

When a set of facts is appropriate for facilitating a partnership with the public sector, there are many paths a client may take. We are value-based attorneys at Jimerson Birr, which means we look at each action with our clients from the point of view of costs and benefits while reducing liability. Then, based on our client’s objectives, we chart a path to seek appropriate remedies.

To determine whether your unique situation may necessitate litigation or another form of specialized public sector advocacy, please contact our office to set up your initial consultation.

How can counsel facilitate due diligence and cost analysis, and what are the associated strategic benefits?

Counsel can strategically facilitate due diligence and cost analysis in the following ways:

• Research legal requirements: Understand the relevant Florida and federal statutes, regulations, and case law related to P3s, ensuring compliance and reducing potential legal risks.
• Identify potential risks: Assess risks associated with the project, such as financial, operational, and legal risks, and advise on strategies to mitigate those risks.
• Evaluate partnership structure: Analyze the most suitable P3 structure for the specific project, considering factors like project scope, financing, and management.
• Negotiate contract terms: Assist in negotiating favorable terms and conditions for the partnership agreement, safeguarding the client’s interests.

Strategic benefits businesses derive from counsel include:

• Competitive advantage: Businesses with comprehensive due diligence and cost analysis are better positioned to submit winning bids, increasing their chances of securing P3s.
• Risk mitigation: Identifying and addressing potential risks can prevent costly setbacks and protect the business’s reputation.
• Efficient resource allocation: Counsel can help businesses prioritize resources for the most promising P3 opportunities, ensuring the best use of time and money.

Please contact our office to set up your initial consultation to see what forms of legal protection and advocacy may be available for your unique situation.

Frequently Asked Questions

1. What is the role of the government in P3s in Florida?

The government plays a critical role in establishing and maintaining P3s in Florida. They are responsible for creating the legal framework, selecting projects for P3s, and ensuring transparency and accountability. Additionally, they often provide financial support or incentives to encourage private-sector participation.

2. How long does the due diligence and cost analysis process typically take?

The duration of the due diligence and cost analysis process varies depending on the complexity of the project and the resources available to the business. However, investing sufficient time in this process is essential to ensure a thorough understanding of the project’s potential risks and rewards.

3. Can businesses collaborate with other private entities in a P3?

Businesses can form consortia or joint ventures with other private entities to participate in P3s, which can help distribute risks and pool resources, increasing the likelihood of a successful partnership.

Have more questions about how your business can access new opportunities in the public sector?

Crucially, this overview of due diligence and cost analysis to determine a competitive contract bid price does not begin to cover all the laws implicated by this issue or the factors that may compel the application of such laws. Every case is unique, and the laws can produce different outcomes depending on the individual circumstances.

Jimerson Birr attorneys guide our clients to help make informed decisions while ensuring their rights are respected and protected. Our lawyers are highly trained and experienced in the nuances of the law, so they can accurately interpret statutes and case law and holistically prepare individuals or companies for their legal endeavors. Through this intense personal investment and advocacy, our lawyers will help resolve the issue’s complicated legal problems efficiently and effectively.

Having a Jimerson Birr attorney on your side means securing a team of seasoned, multi-dimensional, cross-functional legal professionals. Whether it is a transaction, an operational issue, a regulatory challenge, or a contested legal predicament that may require court intervention, we remain tireless advocates at every step. Being a value-added law firm means putting the client at the forefront of everything we do. We use our experience to help our clients navigate even the most complex problems and come out the other side triumphant.

If you want to understand your case, the merits of your claim or defense, potential monetary awards, or the amount of exposure you face, you should speak with a qualified Jimerson Birr lawyer. Our experienced team of attorneys is here to help. Call Jimerson Birr at (904) 389-0050 or use the contact form to schedule a consultation.