CHAPTER 5. PUBLIC-PRIVATE AGREEMENTS
IC 8-15.7-5
Chapter 5. Public-Private Agreements
IC 8-15.7-5-1
Public-private agreement by operator; provisions of agreement
Sec. 1. (a) Before beginning:
(1) the development;
(2) the financing;
(3) the operation; or
(4) any combination of the development, financing, oroperation;
of a qualifying project, the operator must enter into a public-privateagreement with the department. Subject to the other provisions ofthis article, the department and a private entity may enter into apublic-private agreement with respect to a project. Subject to therequirements of this article, a public-private agreement may providethat the private entity, acting on behalf of the department or theauthority, is partially or entirely responsible for any combination ofdeveloping, financing, or operating the qualifying project.
(b) The public-private agreement may, as determined appropriateby the department for the particular qualifying project, provide for allor part of the following:
(1) Delivery of performance and payment bonds or otherperformance security determined suitable by the department,including letters of credit, United States bonds and notes, parentguaranties, and cash collateral, in connection with thedevelopment, financing, or operation of the qualifying project,in the forms and amounts set forth in the public-privateagreement or otherwise determined as satisfactory by thedepartment to protect the department and payment bondbeneficiaries who have a direct contractual relationship with theoperator or a subcontractor of the operator to supply labor ormaterial. A payment or performance bond or alternative form ofperformance security required under a public-private agreementshall not be required for the part of a public-private agreementthat includes only design, planning, or financing services, theperformance of preliminary studies, or the acquisition of realproperty.
(2) Review of plans for any development or operation, or both,of the qualifying project by the department.
(3) Inspection of any construction of or improvements to thequalifying project by the department or another entitydesignated by the department or under the public-privateagreement to ensure that the construction or improvementsconform to the standards set forth in the public-privateagreement or are otherwise acceptable to the department.
(4) Maintenance of:
(A) one (1) or more policies of public liability insurance(copies of which shall be filed with the departmentaccompanied by proofs of coverage); or (B) self-insurance;
each in the form and amount required by the public-privateagreement or otherwise satisfactory to the department asreasonably sufficient to insure coverage of tort liability to thepublic and employees and to enable the continued operation ofthe qualifying project.
(5) If operations are included within the operator's obligationsunder the public-private agreement, monitoring of themaintenance practices of the operator by the department oranother entity designated by the department or under thepublic-private agreement, and the taking of the actions that thedepartment finds appropriate to ensure that the qualifyingproject is properly maintained.
(6) Reimbursement to be paid to the department as set forth inthe public-private agreement for services provided by thedepartment.
(7) Filing of appropriate financial statements and reports as setforth in the public-private agreement or as otherwise in a formacceptable to the department on a periodic basis.
(8) Compensation or payments to the operator, attorneys,bankers, financial advisors, or other professionals.Compensation or payments may include one (1) or more of thefollowing:
(A) A development fee, payable on a lump sum basis,progress payment basis, time and materials basis, or anyother basis considered appropriate by the department.
(B) An operations fee, payable on a lump sum basis, timeand material basis, periodic basis, or any other basisconsidered appropriate by the department.
(C) All or part of the revenues, if any, arising out ofoperation of the qualifying project.
(D) A maximum rate of return on investment or return onequity or a combination of the two (2).
(E) In kind services, materials, property, equipment, or otheritems.
(F) Compensation in the event of any termination.
(G) A cash payment to pay part of the project cost.
(H) Other compensation set forth in the public-privateagreement or otherwise considered appropriate by thedepartment.
(9) Compensation or payments to the department, if any.Compensation or payments may include one (1) or more of thefollowing:
(A) A concession payment, lease payment, or other fee,which may be payable in a lump sum, on a periodic basis, oron any other basis considered appropriate by the department.
(B) Sharing of revenues, if any, from the operation of thequalifying project.
(C) Payment for any services, materials, equipment,personnel, or other items provided by the department to the
operator under the public-private agreement or in connectionwith the qualifying project.
(D) Other compensation set forth in the public-privateagreement or otherwise considered appropriate by thedepartment.
(10) The date and terms of termination of the operator'sauthority and duties under this article, and circumstances underwhich the operator's authority and duties may be terminatedbefore that date.
(11) Reversion of the qualifying project to the department at thetermination or expiration of the public-private agreement.
(12) Rights and remedies of the department if the operatordefaults or otherwise fails to comply with the terms of thepublic-private agreement.
(c) A public-private agreement may not provide that the state orthe department is responsible for any debt incurred by an operator inconnection with the delivery of a project.
As added by P.L.47-2006, SEC.40.
IC 8-15.7-5-1.5
Additional required provisions of agreement
Sec. 1.5. In addition to the other requirements of this article, apublic-private agreement entered into under this article must includethe following:
(1) A requirement for the completion of all environmentalanalyses of the project required by state and federal law in themanner and at the times required by the appropriate state andfederal agencies.
(2) A requirement for ownership by the department in the nameof the state of Indiana of:
(A) all the real property on which the project is located; and
(B) all of the improvements on that real property.
(3) An expedited method for resolving disputes between oramong the department, the parties to the public-privateagreement, and affected jurisdictions, as required byIC 8-15.7-12-2.
As added by P.L.85-2010, SEC.18.
IC 8-15.7-5-2
User fees
Sec. 2. (a) The department may fix and revise the amounts of userfees that an operator may charge and collect for the use of any partof a qualifying project in accordance with the public-privateagreement. In fixing these amounts, the department may:
(1) establish maximum amounts for the user fees; and
(2) provide for increases or decreases of the maximum amountsbased upon the indices, methodologies, or other factors that thedepartment considers appropriate.
(b) User fees established by the department for the use of aqualifying project must be nondiscriminatory and may: (1) include different user fees based on categories such asvehicle class, vehicle size, vehicle axles, vehicle weight,volume, location, traffic congestion, or other means orclassification that the department determines to be appropriate;
(2) vary by time of day or year; and
(3) be based on one (1) or more factors considered relevant bythe department, which may include any combination of:
(A) lease payments;
(B) financing costs and charges;
(C) debt repayment, including principal and interest;
(D) costs of development;
(E) costs of operation;
(F) working capital;
(G) reserves;
(H) depreciation;
(I) compensation to the operator;
(J) compensation to the department; and
(K) other costs, expenses, and factors set forth in thepublic-private agreement or otherwise consideredappropriate by the department.
(c) A public-private agreement may:
(1) authorize the operator to adjust the user fees for the use ofthe qualifying project, so long as the amounts charged andcollected by the operator do not exceed the maximum amountsestablished by the department under this chapter;
(2) provide that any adjustment by the operator permitted undersubdivision (1) may be based on indices, methodologies, orother factors described in the public-private agreement orapproved by the department;
(3) authorize the operator to charge and collect user feesthrough manual and nonmanual methods, including, but notlimited to, automatic vehicle identification systems, electronictoll collection systems, and, to the extent permitted by law,including rules adopted by the department, global positioningsystems and photo or video based toll collection enforcementsystems; and
(4) authorize the collection of user fees by a third party.
(d) A schedule of the current user fees shall be made available bythe operator to any member of the public on request. User fees andthe setting of user fee rates are not subject to supervision orregulation by any other commission, board, bureau, or agency of thestate or any municipality, except to the extent set forth in thepublic-private agreement.
(e) Any action to contest the validity of user fees fixed under thischapter may not be brought after the fifteenth day following theeffective date of a rule fixing the user fees.
As added by P.L.47-2006, SEC.40.
IC 8-15.7-5-3
Grants or loans for qualifying project Sec. 3. In the public-private agreement, the department may agreeto make grants or loans for the development or operation, or both, ofthe qualifying project from amounts received from the federalgovernment, any agency or instrumentality of the federalgovernment, or any state or local agency.
As added by P.L.47-2006, SEC.40.
IC 8-15.7-5-4
Additional provisions of public-private agreement
Sec. 4. The public-private agreement must incorporate the dutiesof the operator under this article and may contain the other terms andconditions that the department determines serve the public purposeof this article. The public-private agreement may contain provisionsunder which the department or the authority agrees to provide noticeof default and cure rights for the benefit of the operator and thepersons or entities described in the public-private agreement that areproviding financing for the qualifying project. The public-privateagreement may contain any other lawful term or condition to whichthe operator and the department mutually agree, including provisionsregarding change orders, dispute resolution, required upgrades to thequalifying project, tolling policies, changes and modifications to thequalifying project, unavoidable delays, or provisions for a loan orgrant of public funds for the development or operation, or both, ofone (1) or more qualifying projects.
As added by P.L.47-2006, SEC.40.
IC 8-15.7-5-5
Distribution of payments received by department underpublic-private agreement
Sec. 5. To the extent that the department receives any payment orcompensation under the public-private agreement other thanrepayment of a loan or grant or reimbursement for services providedby the department to the operator, the payment or compensation shallbe distributed at the direction of the department to the:
(1) major moves construction fund established underIC 8-14-14;
(2) department for deposit in the state highway fund establishedby IC 8-23-9-54;
(3) alternative transportation construction fund establishedunder IC 8-14-17; or
(4) operator or the authority for debt reduction.
As added by P.L.47-2006, SEC.40. Amended by P.L.203-2007,SEC.7.
IC 8-15.7-5-6
Takeover of qualifying project upon termination of public-privateagreement
Sec. 6. (a) Upon the termination or expiration of thepublic-private agreement, including a termination for default, thedepartment may take over the qualifying project and succeed to all
of the right, title, and interest in the qualifying project. Thedepartment may agree to accept the qualifying project subject to anyliens on revenues previously granted by the operator to any personproviding financing for the qualifying project.
(b) If the department elects to take over a qualifying project, thedepartment may do all or part of the following:
(1) Develop, finance, or operate the project.
(2) Impose, collect, retain, and use user fees, if any, for theproject.
(c) The department may use any revenues collected under thissection for any of the following purposes or any other authorized useunder this article:
(1) Making payments to individuals or entities in connectionwith the financing of the qualifying project.
(2) Paying development costs of the project.
(3) Paying current operation costs of the project or facilities,including compensation to the department for the services of thedepartment in operating the qualifying project.
(4) Paying the operator for any compensation or payment owingupon termination.
(d) The full faith and credit of the state or any politicalsubdivision or the authority is not pledged to secure any financing ofthe operator by the election to take over the qualifying project.Assumption of development or operation, or both, of the qualifyingproject does not obligate the state or any political subdivision or theauthority to pay any obligation of the operator.
As added by P.L.47-2006, SEC.40.
IC 8-15.7-5-7
Amendment of public-private agreement
Sec. 7. Any changes in the terms of the public-private agreementagreed to by the parties shall be added to the public-privateagreement by written amendment.
As added by P.L.47-2006, SEC.40.
IC 8-15.7-5-8
Public-private agreement with multiple entities
Sec. 8. Notwithstanding any other provision of this article, thedepartment may enter into a public-private agreement with multipleprivate entities if the department determines in writing that it is in thepublic interest to do so.
As added by P.L.47-2006, SEC.40.
IC 8-15.7-5-9
Public-private agreement for phases or segments of project
Sec. 9. The public-private agreement may provide for all or partof the development, financing, or operation of phases or segments ofthe qualifying project.
As added by P.L.47-2006, SEC.40.
IC 8-15.7-5-10
Memoranda of understanding for implementation of public-privateagreement
Sec. 10. The department may enter into one (1) or morememoranda of understanding with respect to the implementation andadministration of a public-private agreement. The memoranda mayprovide that the department has responsibility for, and shalladminister and oversee certain aspects of the implementation of, thepublic-private agreement under this article, including:
(1) undertaking any oversight and monitoring of the operator asprovided under the public-private agreement;
(2) reviewing plans for development and operation, asapplicable, as provided under the public-private agreement;
(3) granting or denying all consents and approvals as providedunder the public-private agreement, except for consents andapprovals relating to financial matters that the department is notpermitted to grant or deny under applicable law, in which casethe authority shall execute the consents and approvals preparedby the department;
(4) receiving all development, operations, and financial reportsprepared by the operator or others, as provided under thepublic-private agreement;
(5) preparing, negotiating, and executing any change orders andamendments to the public-private agreement;
(6) issuing other written correspondence and communicationson behalf of the authority as provided under the public-privateagreement;
(7) preparing and issuing noncompliance letters and reports,warning notices, and default letters to the operator as providedunder the public-private agreement; and
(8) exercising rights and remedies for a breach or default by theoperator as provided under the public-private agreement, exceptfor rights and remedies relating to financial matters that thedepartment is not permitted to exercise under applicable law, inwhich case the authority shall exercise the rights and remedies.
As added by P.L.47-2006, SEC.40.