Restrictive budgetary rules that make it difficult for the federal government to negotiate real estate leases and public-private partnerships will be explored in-depth during NCPPP’s Federal P3 Summit in Washington, D.C.
Federal scoring makes such projects very expensive for agencies to pursue because Appendix B of Circular A-11, issued by the Office of Management and Budget (OMB), treats as a capital lease any lease that ends in government ownership of the developed asset. An agency must record, or “score,” in its budget the entire cost of a capital lease the year the agency enters into it. Operating leases, on the other hand, can be scored year by year, explained Dorothy Robyn, former head of the U.S. General Services Administration’s Public Buildings Service in a Brookings Institution blog.
“OMB and the Congressional Budget Office (CBO) have gradually extended the reach of A-11 to preclude most public-private ventures aimed at financing federal acquisition of capital assets,” noted Robyn.
NCPPP will hold two sessions on federal scoring during the Summit. The first will provide an introduction to the issue and set the stage for the second session during which Robyn and several other experts will discuss the merits of potential solutions and the extent to which they are likely to be implemented.
The introductory session will be moderated by Sandy Hoe, Senior of Counsel at Covington & Burling LLP, and feature:
- Jay Brown, Managing Director, Alvarez & Marsal Public Sector Real Estate Services
- Sinclair Cooper, President, Public Infrastructure Development, Hunt Companies
- Anita Molino, Principal, Bostonia Partners LLC
- Domenic Savini, Assistant Director, Federal Accounting Standards Advisory Board
The second session, “Point/Counterpoint Debate on Federal Budget Scoring Issues,” to be moderated by George Schlossberg, Partner at Kutak Rock LLP, will feature views from Robyn and panelists:
- David Haun, PT-GPS Director, Grant Thornton LLP; and former Deputy Associate Director, Office of Management and Budget
- Jill Jamieson, Managing Director, Public Institutions Group, JLL
To help develop solutions to the obstacles federal scoring imposes, NCPPP will use the discussions held during these sessions in a federal scoring research project it is conducting with the Urban Land Institute’s (ULI) Public Development Infrastructure Council, which is funding this effort. ULI also will discuss this issue during an expert’s roundtable at its spring meeting.
The Federal P3 Summit will be held March 17-18 at the FHI 360 Conference Center in Washington, D.C. For more information about this event and to register, visit the event website.
NCPPP
By March 4, 2016