Despite Concerns, Prince George’s Moves Ahead With Plan To Build Public Schools With Public-Private Partnership

The Prince George’s County Council approved the construction and funding of six new public schools by 2023 through an unusual public-private partnership, or P3, on Thursday.

The vote was 8-3 with dissenting votes from Councilmembers Monica Anderson-Walker, Thomas Dernoga, and Jolene Ivey. These council members are worried that the project could end up with problems similar to Maryland’s largest P3 project, the light-rail Purple Line.

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Prince George’s County wants to build and fund six new public schools by 2023 through an unusual public-private partnership, or P3. But it needs council approval to do so. And many council members sound worried that the project could end up with problems similar to Maryland’s largest P3 project, the light-rail Purple Line.

The county plans to build and fund five new middle schools and one K-8 school by partnering with five contractors: Fengate Asset Management, Gilbane Development Company, Gilbane Building Company, Stantec and Honeywell. The cost would be approximately $1.24 billion to build the schools in about three years. County taxpayers would bear $29.8 million in costs for the initial investment. The plan includes a 30-year contract with the companies that would be repaid with interest. During those 30 years, the contractor would be responsible for the maintenance and repairs needed on the schools.

Monica Goldson, the county schools’ CEO, says the school district would be the first in the nation to fund the construction of schools through a P3.

“By taking this non-traditional route, Prince George’s County Public Schools is showing that students should not be forced to wait longer than necessary for high-quality learning environments,” Goldson said in a press release.

Prince George’s County faces overcrowding and an $8.5 billion backlog in new school construction and maintenance. At least 10 schools in the county, including Forest Heights Elementary in Oxon Hill, were shuttered and abandoned because they were considered unsafe for students.

In the council’s virtual meeting on Tuesday, member Jolene Ivey said she’s supportive of making sure students have new schools. But she says she’s concerned about the long-term effects the project could have on taxpayers.

“Two years ago when we started this process, this was a great idea,” Ivey said. “But at this point I don’t know. Two years ago we didn’t know we’d be in the middle of a pandemic and our economy would be very different.”

Goldson tried to reassure Ivey and other council members that the project would not proceed if and when “the value added exceeded what we anticipated the costs would be.”

“Anytime that cost was over what we projected it to be in that life span, then it would not have been worth doing the project,” she said

Jayson Washington, director of the county schools’ capital programs, tried to quell some of the council members’ concerns by citing lessons learned from the now upended Purple Line project.

“We were very proactive in helping to identify and mitigate what we believe are risks that could be associated with creating schedule delays and potential disputes,” Washington said.

The project also has some contractual protections for the county. Those include requiring school construction to be finished by July 15, 2024, imposing late fees on delayed construction, hiring an independent engineer to make sure buildings are to code and protect the county’s investment, and protecting the county from loan default on issues related to construction. During construction, the contractors will also have monitoring reports and the county schools maintain the right to step-in if the project isn’t being done properly.

The project could create 3,000 jobs with prevailing wages and increase the county’s GDP by 2 percent. Without the P3, the cost to the county would be 15 to 20 percent more and construction would take until 2036.

 

Source: Wamu