HB2300 - 511R

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 28-7705, Arizona Revised Statutes, is amended to read:

START_STATUTE28-7705. Public-private partnership agreements

A. In any public-private partnership or other agreement for any eligible facility under this chapter, the department may include provisions that:

1. Authorize the department or the private partner to establish and collect user charges, tolls, fares, rents, advertising and sponsorship charges, service charges or similar charges, including provisions that:

(a) Specify technology to be used in the facility.

(b) Establish circumstances under which the department may receive all or a share of revenues from such charges.

(c) Govern enforcement of tolls, including provisions for use of cameras or other mechanisms to ensure that users have paid tolls that are due and provisions that allow the private partner access to relevant databases for enforcement purposes. Misuse of the data contained in the databases, including negligence in securing the data properly, shall result in a civil penalty of ten thousand dollars for each violation. Civil penalties collected pursuant to this subdivision shall be deposited in the state general fund.

(d) Authorize the department to continue or cease collection of user charges, tolls, fares or similar charges after the end of the term of the agreement.

2. Allow for payments to be made by this state to the private partner, including availability payments or performance based payments.

3. Allow the department to accept payments of monies and share revenues with the private partner.

4. Address how the partners will share management of the risks of the project.

5. Specify how the partners will share the costs of development of the project.

6. Allocate financial responsibility for cost overruns.

7. Establish the damages to be assessed for nonperformance.

8. Establish performance criteria or incentives, or both.

9. Address the acquisition of rights-of-way and other property interests that may be required, including provisions that address the exercise of eminent domain as provided in section 28‑7709. This state shall not relinquish its power of eminent domain authority to the private partner.

10. Establish record keeping, accounting and auditing standards to be used for the project.

11. For a project that reverts to public ownership, address responsibility for reconstruction or renovations that are required in order for a facility to meet all applicable government standards on reversion of the facility to this state.

12. Provide for patrolling and law enforcement on public facilities.

13. Identify any department specifications that must be satisfied, including provisions allowing the private partner to request and receive authorization to deviate from the specifications on making a showing satisfactory to the department.

14. Require a private partner to provide performance and payment bonds, parent company guarantees, letters of credit or other acceptable forms of security or a combination of any of these, the penal sum or amount of which may shall be less than one hundred per cent of the value of the contract involved based on the department's determination, made on a facility‑by‑facility basis, of what is required to adequately protect this state.

15. Authorize the private partner in any concession agreement to establish and collect user charges, tolls, fares, rents, advertising and sponsorship charges, service charges or similar charges to cover its costs and provide for a reasonable rate of return on the private partner's investment, including provisions such as the following:

(a) The charges may be collected directly by the private partner or by a third party engaged for that purpose.

(b) A formula for the adjustment of user charges, tolls, fares, rents, advertising and sponsorship charges, service charges or similar charges during the term of the agreement.

(c) For an agreement that does not include a formula described in subdivision (b) of this paragraph, provisions regulating the private partner's return on investment.

(d) A maximum multiplier that may be applied to the difference between passenger and commercial vehicle user charges, tolls, fares or similar charges.

(e) A variety of traffic management strategies, including:

(i) General purpose toll lanes.

(ii) High occupancy vehicle lanes where single or low occupancy vehicles may use higher occupancy vehicle lanes by paying a toll.

(iii) Lanes or facilities in which the tolls may vary during the course of the day or week or according to levels of congestion anticipated or experienced.

(iv) Combinations of, or variations on, items (i), (ii) and (iii), or other strategies the department determines are appropriate on a facility‑by‑facility basis.

(v) Mechanisms for notice to drivers of an upcoming facility and options to pay user charges, tolls, fares or similar charges at the facility location.

16. Specify remedies available and dispute resolution procedures, including the right of the private partner to institute legal proceedings to obtain an enforceable judgment or award against the department in the event of a default by the department and procedures for use of dispute review boards, mediation, facilitated negotiation, arbitration and other alternative dispute resolution procedures.

17. Allow the department to acquire real property that is needed for and related to eligible facilities, including acquisition by exchange for other real property that is owned by the department. An acquisition pursuant to this paragraph is exempt from chapter 20, articles 6 and 8 of this title.

B. Notwithstanding any other law, the department may enter into agreements, whether a concession agreement or other form of agreement, with any private partner that includes provisions described in subsection A of this section. Agreements may be for a term not to exceed fifty years but may be extended for additional terms.

C. The department may approve any request from another unit of government to develop an eligible facility in a manner similar to that used by the department under this chapter.

D. Notwithstanding any other law, agreements under this chapter that are properly developed, operated or held by a private partner under a concession agreement pursuant to this chapter are exempt from all state and local ad valorem and property taxes that otherwise might be applicable.

E. The agreement shall contain a provision by which the private partner expressly agrees that it is prohibited from seeking injunctive or other equitable relief to delay, prevent or otherwise hinder the department or any jurisdiction from developing, constructing or maintaining any facility that was planned and that would or might impact the revenue that the private partner would or might derive from the facility developed under the agreement, except that the agreement may provide for reasonable compensation to the private partner for the adverse effect on toll revenues or other user fee revenues resulting from development, construction and maintenance of an unplanned revenue impacting facility.

F. The agreement shall contain a provision that prohibits photo traffic enforcement of chapter 3, article 6 of this title on toll lanes.

G. Any foreign private entity that enters into an agreement with the department pursuant to this section must provide satisfactory evidence to the board that the foreign entity is in compliance with the requirements of title 10, chapter 38.

H. The agreement shall contain a provision that all public-private partnerships are subject to chapter 20, article 3 of this title.END_STATUTE