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With $8.5 billion work backlog, Pr. George’s schools look to public-private partnerships

Interim schools chief Monica Goldson supports the P3 model in Prince George’s County. (Marvin Joseph/The Washington Post)

Prince George’s County is on track to become the first jurisdiction in the United States to use a public-private partnership to build and maintain several of its public schools — a move officials say will speed construction and decrease the system’s estimated $8.5 billion maintenance and construction backlog.

The decision comes amid increasing frustration about aging schools in the populous Washington suburb and growing discussion in Maryland surrounding public-private partnerships, which are being used to build the Purple Line light-rail system and which Gov. Larry Hogan (R) wants to use to build toll lanes on the Capital Beltway and Interstate 270.

Christian Rhodes, chief of staff to interim Prince George’s schools chief Monica Goldson, said the county wants to hire a private company to manage construction of five to seven new schools this fall.

By removing the bureaucratic hurdles typically involved in school construction — including several procurement processes — and giving one company a contract to build multiple schools, construction costs should decrease, proponents of the idea say.

The private company that the school system selects will design the building and finance its construction; county and state funding, including for payments to the contractor, will kick in once students are in the building. The schools will have to meet the same safety and code regulations as all school system buildings.

Officials say the schools will be built 14 years faster than if the school system was running the process, and at an estimated 15 to 20 percent lower cost. The locations for the schools — some new and some replacing existing buildings — have not been determined by the school system.

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“There are going to be a lot of eyes on this,” said Jason Washington, executive director of the National Council for Public Private Partnerships. “The key is to do what the county has done and be thoughtful and deliberate, because every jurisdiction is going to be different.”

The Prince George’s school system is the second largest in Maryland and one of the 25 largest in the country. It has in recent years weathered several scandals and high turnover among its leaders. But officials in the county say they are optimistic that the district could be a leader in applying public-private partnerships, known as P3s, to school construction.

Critics of that model, which has been used to build schools in Canada for two decades, cite concerns about transparency and quality of construction and note that in some cases, the arrangement has ended up being more costly to taxpayers than the traditional system.

They say oversight of the companies involved in public-private partnerships, and ensuring competitive bidding, is especially important given the amount of control the firms have over the project.

In Prince George’s, the same private company that the school system selects to build the schools will also do large-scale maintenance, including electrical and HVAC systems.

As a result, said state Sen. James C. Rosapepe (D-Prince George’s), one of the chief proponents of the public-private model, unexpected maintenance costs will be reduced and issues will be addressed more quickly.

“This is a game changer,” Rosapepe said. “Any kid in an overcrowded school or teacher with water coming down the ceiling when it rains knows the current system is broken.”

Complaints about school facilities are familiar to residents in Prince George’s. Broken air conditioning units caused the school system to send students home early last summer, and reports of mold raised alarm among parents last fall.

Forty percent of the district’s 209 schools are nearly 60 years old. Schools in the northern part of the county are overcrowded; schools in the south struggle to fill seats.

“We want to make sure that our students can learn in an environment that is conducive to learning,” said County Executive Angela D. Alsobrooks (D).

Alsobrooks, who was elected in November, said she embraced the P3 idea after state and county work groups came out in favor of the model. The county plans to invest $25 million to $30 million annually for the next 30 years in school construction, and Alsobrooks said she is going to fight for an infusion of state funding for the program next year in Annapolis.

A bill backed by Alsobrooks and the Prince George’s delegation that would have put $25 million annually in state dollars toward the program died in the state Senate in April. A more modest bill, which establishes the framework for how state funding would be funneled into the program, was approved.

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County Council Chairman Todd Turner (D-District 4), who sat on the county work group, said a public-private partnership will enable the county to manage maintenance costs and reduce overcrowding. “We were playing catch-up,” Turner said. “And our question is, ‘Is there a way to do it differently with the resources we have?’ ”

The county hired a consultant from Jones Lang LaSalle to work with officials as they studied the viability of a P3 model.

Managing director Jill Jamieson said it is important to avoid escalating construction costs similar to what happened in Alberta, Canada, where an auditor found that the government overestimated public savings by about $20 million.

There have been hundreds of successful public-private partnerships across Canada — to build schools, highways and hospitals. Jamieson said that when problems have arisen, it is generally because of a lack of competitive bids.

“You can’t get lazy,” Jamieson said. “You are basically offering someone a monopoly. There has to be competition so you can ensure that you are getting the best prices.”

She said she will review the options with county officials after private companies put forward their bids. If they determine that building with the traditional process will be less expensive than with the P3 model, they will use that option, she said.

The school system recently hosted an “industry day” to provide information about the program to potential bidders; more than 400 people registered, Jamieson said.

College Park Academy, a public charter school near the University of Maryland’s campus, was built through a public-private partnership in 2013, with a priority placed on minimizing costs. The total building price ended up being about $12,600 per student, compared with $31,140 per student it cost to build Accokeek Academy — a public school built the traditional way — in 2009.

Rhodes, Goldson’s chief of staff, said he expects that the school system will put out a request for qualifications this month and a request for proposals in August, with emphasis on drawing local and minority-owned businesses.

After the 33-year contract ends — approximately three years for building and 30 years of the company handling maintenance — the school system will regain control of the buildings.

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