The tragedy of Mick Mulvaney and the war budget

Government Business

Article | July 14, 2022

Taxpayers, citizens, and industry leaders may not be totally familiar with Public Facility Corporations (PFCs), but that should change, especially now since public funding for critical projects is at an all-time low. PFCs are becoming somewhat common in many regions of the country. If the legal entity (PFC) is not familiar, here’s a bit of background. A PFC is a nonprofit corporation created by a sponsoring governmental entity — a city, county, school district, housing authority, or special district. PFCs have broad powers over public facilities, including financing, acquisition, construction, rehabilitation, renovation and repair. A PFC, once created, has the authority to issue bonds on behalf of its sponsoring public entity and once the bonds are funded, the money can be used in numerous ways. This type of legal entity has gained attention because public officials with critical projects are being forced to seek alternative funding sources. In Texas, public facility corporations are allowed the broadest possible powers to finance or provide for the acquisition, construction and rehabilitation of public facilities at the lowest possible borrowing cost. A sponsor — such as a municipality, county, school district or housing authority — may create one or more of nonprofit public facility corporations. Then, the PFC can issue bonds for the construction of public facilities or finance public facilities or even loan the proceeds of the revenue to other entities for specific purposes. A report that was released by The University of Texas School of Law found that a house bill approved during the 2015 legislative session “expands the authority of public facility corporations and allows the corporation to exercise any power that a nonprofit corporation might exercise and/or grant a leasehold or other possessory interest in a public facility owned by the PFC.” Here’s a bit more background of what is happening in Texas and there are numerous similar examples throughout the country. The El Paso Independent School District (EPISD) several years ago created the EPISD Public Facility Corporation to fund construction of central offices through non-voter approved bonds. The corporation issued more than $29 million in bonds. The plan called for the EPISD to repay the bonds with general fund dollars from the district's general fund. The 2019 Texas Legislative Session ended with a $4 million rider added to the state appropriations budget. The money was provided to the city of Port Aransas to build a $36 million apartment complex for affordable housing. Plans call for the 200-unit complex to be operated by the Port Aransas Public Facility Corporation. The corporation will work in partnership with a private company to develop and manage the property. An investment of approximately $14 million came from the private sector partner, and the Texas Department of Housing and Community Affairs provided an additional $18 million in funding. Site work on the project began in July 2020. Many school districts have created public facility corporations for construction projects for schools, and many municipalities have also used PFCs. The revenue from these types of bonds is sometimes called lease-revenue bonds. They do not require voter approval. Public facility corporations do not have the authority to raise tax rates, but it is possible for a school board to approve a property tax increase to make payments on the bonds sold by a PFC. The city of Tioga, located in the Sherman/Dennison region of Texas, constructed a new high school with funding from a public facility corporation. A collaborative initiative was launched with a lease-purchase agreement which allowed the PFC to hold title to the land and facility until the investment was repaid. At that time, the agreement calls for everything to transfer back to the district. Because the current campus was reaching its maximum capacity, a new high school campus had been a priority for the district and this was the funding mechanism selected. The city of Fate in Rockwell County recently embarked on a public-private partnership to develop an affordable seniors housing community. The projected cost is approximately $30 million. To fund the project, the city created a PFC. Plans are for the city to handle the design, construction, and management of the project in collaboration with the PFC. City leaders will appoint board members to the funding corporation which will then operate the development as a nonprofit. The project is anticipated for completion in January 2022. There are similar types of alternative types of funding options in other parts of the U.S. In Utah, for instance, the Park City Board of Education approved a PFC which will allow the district to secure revenue for a number of master plan projects. The projects have a combined projected cost of $122 million. The school district had considered the funding option of general obligation bonds, which would require voter approval, but elected to create a Local Building Authority (LBA). This funding option will allow them to fund an expansion of a high school facility to accommodate ninth-graders and expand another campus to allow for eighth-grade students. Public officials, legislators, government contractors, and taxpayers all should have an interest in watching PFCs as well as other alternative funding sources. Until traditional public funding becomes more available for critical public projects, there will be a need for various types of funding solutions. Mary Scott Nabers is president and CEO of Strategic Partnerships Inc., a business development company specializing in government contracting and procurement consulting throughout the U.S. Her recently released book, Inside the Infrastructure Revolution: A Roadmap for Building America, is a handbook for contractors, investors and the public at large seeking to explore how public-private partnerships or joint ventures can help finance their infrastructure projects.

Article | May 26, 2021

The average smartphone user should be fully informed about 5G, or have seen dozens of commercials promoting the service. Telecom companies are aggressively pushing it, with some even offering 5G routers and access points for home. While the federal government has always been interested in 5G and is testing it at several military bases, the technology's consumerization means that agencies must work faster to integrate it into their own networks. Citizens who have grown accustomed to lightning-fast connections on their home internet and phones will expect the same when contacting the government. For the past few years, the development of government 5G has been slow. The Trump administration sanctioned Huawei, the leading supplier of 5G wireless network infrastructure at the time, in 2019 because its ties to the Chinese government posed a national security risk. For a time, this limited the availability of 5G network technology in the United States until telecoms were able to switch to non-Chinese company vendors. The 5G Market is Starting to Open Up to Federal Customers: Other challenges for federal 5G include the potential for signals to disrupt safety equipment aboard commercial aircraft (Verizon and AT&T agreed in January not to turn on hundreds of transmission towers near airports), as well as ongoing supply chain and workforce shortage issues. Agencies are also in the process of transitioning their telecommunications contracts to the GSA's Enterprise Infrastructure Solutions contract. All existing telecom contracts that are not already covered by EIS will expire in May 2023. It's been a trying and perplexing time for 5G supporters. However, the 5G market is beginning to shift, which may allow federal agencies to move as quickly as consumers would like. Changes to the 5G Network Will Increase Speed and Improve Workflow: Agencies wishing to deploy 5G will require vendors capable of securing the endpoints that connect to the network, whether on the ground or in the air, as well as the connections between the agency and its telecom provider. As network usage grows, user authentication and identity management will become essential services. 5G will allow agencies to receive and transmit far more data at a much faster rate than ever before, but that data must be protected and secured. 5G may also replace existing network technologies such as WAN and multiprotocol label-switching, and agencies must prepare for this transition.

Cybersecurity

Article | March 23, 2022

Federal agencies design a wide range of tools, equipment, vehicles and even rockets. Computer-aided design (CAD) technology allows agencies and users to create digital designs more efficiently. CAD is used for a lot more than designing buildings, but is a basic building block of a more advanced tool known as Building Information Modeling, or BIM. CAD can be used to render 2D digital models of products, equipment and buildings. BIM takes those efforts to the next level and serves as a 3D design tool to “create and simulate how a building would operate,” says Andrew Friendly, associate vice president of government affairs at Autodesk, a leading CAD and BIM firm.

Article | June 17, 2020

COVID-19 hit the construction industry like a tsunami. Almost all medium to large construction projects were shuttered as government leaders scrambled to protect the health of Americans. Today, however, even though the pandemic has not been contained, there is renewed interest in construction and reason for optimism. The immediate future is considerably brighter today than it was three months ago. Although construction projects are moving slower and fewer new ones being launched, there is definite movement. One year ago, construction projects were so abundant industry leaders warned of imminent danger related to America’s shortage of skilled construction workers, designers, and engineers. Those alarms are not as loud today, but that could change soon because new projects are being announced on a daily basis throughout the country. Officials at the Tampa International Airport placed approximately $906 million in construction projects on hold, but there’s little doubt that construction will begin again in the not too distant future. Air travel is down more than 95 percent, and urgency for planned expansions and upgrades is not as great. Many colleges and universities also have delayed projects. In fact, the University of Nebraska-Lincoln (UNL) put a two-year halt on construction planned for this month. A $155 million football facility near Memorial Stadium is delayed primarily because university officials anticipate a $50 million budget shortfall. There’s also uncertainty about when sports events can resume. But, more positive news may definitely be found in almost every state in the U.S. Here are just a few examples of upcoming construction projects in America. Louisiana The Louisiana State Legislature has approved $529 million for construction on university campuses. The University of Louisiana at Lafayette plans to spend $187,700 to repair Fletcher Hall and $16.4 million to renovate Madison Hall. Northwestern State University will receive $37.4 million for construction related to Kyser Hall. Louisiana Tech University plans to spend $40.5 million for a number of campus improvements, and Louisiana State University (LSU) has $227.7 million for construction projects. Southern University in Baton Rouge has planned renovations and expansions for about $18.2 million. North Carolina Wake County has approved a $1.47 billion budget and Capital Improvement Plan (CIP). It outlines construction projects at Wake Technical Community College that include new buildings on many campuses. One project outlined in the CIP is a new Emergency Operations Center, and other projects include a new Public Health Center, construction of training space at the Board of Elections Center, facility upgrades at Human Services Sunnybrook, a Facility Condition Assessment program, and vacant space build out for housing at Oak City Multi-Services Center. Missouri On June 2, North Kansas City Schools received approval for a $155 million zero-tax increase bond issue. Lee’s Summit voters also approved a new $224 million bond issue for various infrastructure projects in the R-7 School District. Some of the construction projects include a fourth middle school facility and renovations to the three existing middle school facilities. Voters approved a no-levy-increase bond question for $25 million for improvements to district facilities at Belton School District 124. Wisconsin The city of Sun Prairie has approved its 2021-2023 Capital Improvement Plan that includes many construction projects. The funding includes $7.4 million for phosphorous treatment and plant capacity upgrades at the Water Pollution Control Facility and $2.1 million for Sun Prairie Utility’s Business Park Substation expansion. Unfunded projects for 2021 include $3 million for a library expansion, a public works campus, and a Grans-Hepker intersection expansion. In 2022 the city will spend $7.4 million on street reconstruction. Another unfunded project for years 2022 and 2023 is a $5.7 million bathhouse renovation. New Jersey The New Jersey Turnpike Authority and the South Jersey Transportation Authority approved a toll increase to fund approximately $25 billion in construction over 10 years. Projects include the widening of 15 different sections of a turnpike, the replacement of a bridge between New Jersey and Pennsylvania, and upgrades to roadway tolling stations. The plan also calls for widening of a 13-mile section of the Expressway, construction of a direct connector to the Atlantic City Airport and installation of cashless toll equipment. The governor announced plans this week to develop an offshore wind port on an artificial island along the Delaware River, potentially giving the state a competitive edge in the race to attract offshore wind jobs and manufacturers. The project would be unlike anything yet proposed in the U.S. and its cost could be as high as $400 million. The New Jersey Economic Development Authority will lead development of the port with the hope of creating thousands of high paying jobs and establishing New Jersey as the national capital of ‘off shore wind’. Texas The Capital Area Metropolitan Planning Organization (CAMPO) Transportation Policy Board adopted a 2021-2024 Transportation Improvement Program (TIP) that has numerous major construction projects. It includes $633 million for the I-35 Capital Express project which will be sponsored by the Texas Department of Transportation (TxDOT). The TIP also outlines transportation plans from regional transportation entities including TxDOT-Austin District, Capital Metro, Capital Area Rural Transportation System, and other local sponsors that have federally funded or regionally significant projects. One project the board chose to maintain is construction of two lane frontage roads on U.S. Highway 183. That project is projected to cost approximately $75 million. Other projects in the CAMPO plan are: Slaughter Lane widening to six lanes from Brodie Lane to N. Mopac Expressway – $15.73 million; William Cannon widening to four lanes from McKinney Falls Parkway to Running Water Drive – $14.69 million; Braker Lane extension from Samsung Boulevard to Dawes Place – $14.05 million; University Boulevard reconstruction and widening to four lanes from County Road 110 to A.W. Grimes Road – $7.88 million; Gattis School Road Segment 6 widening to six lanes – $11.38 million; RM 967 widening from Oak Forest Drive to FM 1626 – $5.32 million; FM 621 widening from CR 266 to De Zavala Drive in Hays County – $5.1 million; SH 180 left turn lane installation and elimination of shoulder gap – $2.05 million; and, Hopkins Multi-use Bike-Pedestrian Facility construction – $2 million. Construction, engineering, architectural, and design firms will, no doubt, find immediate opportunities to contract with public officials. Additionally, as Congress begins to take up the task of developing an infrastructure bill, it is clear that construction projects will be hailed as the fastest way to stimulate the nation’s economy – a goal that has bipartisan support in America. Mary Scott Nabers is president and CEO of Strategic Partnerships Inc., a business development company specializing in government contracting and procurement consulting throughout the U.S. Her recently released book, Inside the Infrastructure Revolution: A Roadmap for Building America, is a handbook for contractors, investors and the public at large seeking to explore how public-private partnerships or joint ventures can help finance their infrastructure projects.