The $1.8 billion public-private partnership to renovate the Great Hall at Denver International Airport likely will be just the first such deal that Denver enters into as the city seeks to rehabilitate aging facilities and infrastructure or complete major redevelopment projects.
As we reported earlier, the office of Mayor Michael Hancock wants to create an Office of Public-Private Partnerships to vet and coordinate such projects, with the National Western Center and the Denver Center for the Performing Arts two likely prospects in the relatively near future.
But the DIA deal gave a lot of council members heartburn, even though the final vote on the contract was a not-particularly-close 10-2, and some members similarly have concerns about the way this Office of P3 could work. The current proposal calls for Denver City Council to approve a “framework ordinance” laying out the important terms and conditions of each project, but the final contract would be negotiated by the administration and not come back to council for approval.
Traditionally, City Council has final say on contracts, and some members are hesitant to cede this authority, especially with billions of dollars and major public assets on the line.
In the face of those concerns, the Mayor’s Office is delaying a request to extend a contract with Arup Advisory Inc. to further develop the idea of an Office of P3.
The city has already spent $475,000, and administration officials have asked City Council to approve an additional $480,000 in consulting work (for a total of $955,000) to get the program up and running by year’s end. The actual creation and staffing of the office would be part of the 2018 budget process.
Here’s what Jenna Espinoza, a spokeswoman for the Mayor’s Office, said in an email:
Stakeholder engagement is a critical component to this effort, and City Council is one of the most important stakeholders, and their partnership is foundational to the success of this effort. We heard that they want additional education and to be brought up to speed before being asked to consider the contract amendment, so we are taking the necessary time and steps to do this important work.
The Mayor’s Office plans to hold a “fundamentals workshop” with a “diverse set of professionals from the public and private sectors who have broad P3 experience to speak about successes and lessons learned.”
This issue is expected to come back to committee toward the end of October for more discussion and debate and — if the administration has been persuasive — a yes vote from council.