According to the Chief Economist with Associated Builders and Contractors*, it will likely take years for the nation’s economy to recover from the pandemic’s blow.
“Many state and local governments are now experiencing the emergence of massive gaps in their budgets, budgets that must be balanced each fiscal year,” said Anirban Basu, Chief Economist with Associated Builders and Contractors (ABC).
State and local government budgets are finding themselves under severe and mounting financial pressure. Going forward, local governments will need to explore creative access to funds for much-needed public building projects, as they recover from the unforeseen budget shortfalls resulting from COVID-19.
Alternative project funding can be secured in numerous ways. The simplest way to access alternative funding is through a public-private partnership engagement.
A public-private partnership, often called a P3, can be set up to finance, design, and build a project often on more advantageous terms to the public sector than traditional delivery methods.
Typically, the public sector client (or a multiple jurisdiction entity) holds a single contract with the P3 provider for both design and construction.
Any project for which there is a clear public benefit is a candidate. A P3 agreement can authorize the development, design, construction, replacement, improvement (and even ownership) of a broad range of public-use buildings such as schools, hospitals, courthouses, universities, parking garages, police stations, recreation centers, and correctional facilities.
“Projects are being postponed or even canceled in large numbers, as would-be purchasers of construction services strive to preserve their own liquidity,” Basu said.
“One potential silver lining of the devastating COVID-19 pandemic — in terms of its impact upon our public-sector clients — is the re-emergence of public-private partnerships. Shockey has long experience as a P3 partner, and we stand ready to help local governments and regional authorities tap into private teaming agreements that will move much-needed projects forward,” said Jeff Boehm, President of Howard Shockey & Sons, Inc.
Shockey is committed to the development of innovative P3 solutions and has been a longtime leader in public-private partnerships in the Commonwealth. Boehm served on the Virginia Legislature’s inaugural PPEA Model Guidelines Task Force and has also served on the national ABC/NCPPP Joint Council for Public-Private Partnerships.
If you would like to learn more about how a public-private partnership might move forward in your locality, it’s best to talk with an expert. Please contact Jeff Boehm to see if an opportunity might exist in your community.
About Howard Shockey & Sons, Inc.
Shockey’s reputation, earned one project at a time, is for delivering excellent value, high-quality craftsmanship, and unbeatable integrity. Consistently ranked among the mid-Atlantic’s largest contractors, Shockey specializes in education, senior living, healthcare, commercial, parking, and industrial projects. Shockey is the Partner of Choice ®. Visit ShockeyBuilds.com to learn more.
* From All Systems Go to a Deep Recession in One Month by Anirban Basu, in Construction Executive.