When the Pennsylvania Department of Transportation (PennDOT) announced on April 1, 2023, that the window had opened to submit unsolicited P3 proposals (UPP), discussions and debates kicked into high gear regarding the effectiveness of seeking P3 opportunities in this manner.
Conversations in the public sector are rife with officials who dread the distraction that comes from reviewing unsolicited projects that are more often than not, unscalable, unrealistic or completely out-of-sync with department priorities, policies and P3 authority. One former official shared a story about receiving an unsolicited proposal so voluminous; it arrived in a refrigerator-size box.
From the perspective of the private sector, many industry leaders see little value investing the time and expense needed to prepare a UPP because these projects, even if they are advanced to a formal RFQ process, are not typically awarded to the team who originated the idea. Another concern is protecting intellectual property, as the information contained in the solicitation typically becomes public once submitted to an agency.
Branden Kiely, a Vice President with The Concourse Group, a Washington, DC-based consulting firm specializing in real estate, energy and operational infrastructure is generally supportive of the UPP process stating, “Unsolicited proposals are good avenues to get an idea for a project out there. Oftentimes, these proposals end up becoming a formal procurement.”
While noting that his firm has on occasion submitted an unsolicited proposal, he acknowledges they are extremely cautious when selecting states in which they would submit a UPP, as the protections afforded confidential information are vastly different. “You do not want to see your ideas and proprietary information handed off to a competitor. It is very important to be familiar with the procurement regulations and Sunshine Laws of each state.”
By Sunshine Laws, Kiely is referring to information subject to disclosure under a state’s public disclosure laws. As an example, Kentucky’s public records law exempts from public disclosure records “confidentially disclosed to an agency or required by an agency to be disclosed to it, generally recognized as confidential or proprietary, which if openly disclosed would permit an unfair commercial advantage to competitors of the entity that disclosed the records.”
On the other end of the spectrum, Georgia’s statutes say, “A private entity assumes all risk in submission of a proposal or unsolicited proposal.” It further notes, “a local government shall not incur any obligation to reimburse a private entity for any costs, damages, or loss of intellectual property incurred by a private entity in the creation, development, or submission of a proposal or unsolicited proposal for a qualifying project.”
Bryan Kendro, the National Innovative Program Advisory Leader for RS&H, Inc., was instrumental in structuring PennDOT’s P3 program in 2012 when he served as the Policy Director for the agency. Knowing that unsolicited proposals would be a requirement of the P3 legislation, he conferred with his colleagues in other states and determined the best strategy would be to offer a defined timeline for submitting and reviewing these solicitations. As a result of his efforts, PennDOT accepts UPPs during the months of April and October each year.
Kendro believes UPPs contributed to the early growth and development of the P3 industry in the United States. As an example, he cited the Virginia I-495 HOT lanes as a project that happened because of a UPP. He also discussed how Pennsylvania’s Rapid Bridge Replacement Project was the result of department officials taking meetings and hearing similar ideas from multiple third party teams. “While not technically an unsolicited proposal, this project was the direct result of private sector thinking and innovation.”
Due to the expense and complexity of large scale infrastructure projects, Kendro believes the best opportunities for firms that submit UPPs may be in proposing projects with smaller entities such as county governments and higher education institutions. “The Northampton County (PA) Bridge Renewal Program is the direct result of a unsolicited proposal submitted to the Pennsylvania Public-Private Transportation Partnership Board in November 2015,” he stated. The project, which the Federal Highway Administration identifies as “one of the first P3 concessions to be initiated by a local government entity in the United States in the transportation sector,” is a 14-year, $37.5 million project.
Kendro is quick to point out that the team which proposed the Northampton project did not win the bid, but notes PennDOT offers a “carrot” to firms which submit UPPs. “If the agency decides to move forward on an unsolicited project, the proposer would have to respond to the RFQ but would not be ranked and only evaluated on a pass/fail basis to allow them to advance in the selection process.”
At the end of the day, Kendro believes that, with a proper framework, UPPs have a place in the arena of P3 procurement. “If you define a process and provide structure, you can force meaningful discussion on new ideas.”