North Carolina
League of Municipalities
Public/Private Partnerships
October 24, 2011
Public/Private Partnerships
What is a Public/Private Partnership?
Why Use One?
How Do They Happen?
This Session will Provide Answers
How Public/Private Partnerships Work:
Committed Leadership
Public Support
The Right Deal
Financing Well Within Capacity
True Partners
Funding and Financing
Public/Private Partnerships
General Obligation Bonds
Tax Increment Financing (TIF’s)
Synthetic TIF’s
Installment Purchase Contracts
& Construction Leasebacks
Funding and Financing
Public/Private Partnerships
Grant Funding
Private Incentives
Case Study #1
Levine Center for the Arts
Charlotte, NC
The Duke Energy Center
Duke Energy Center
John S. and James L. Knight Theater
John S. and James L. Knight Theater
The Bechtler Museum of Modern Art
+ “Firebird”
The Mint Museum Uptown
The Harvey B. Gantt Center for
African-American Arts+Culture
Major Partners in the Process
Primary
Others
• Wachovia / Wells Fargo
• Mecklenburg Towns
• City of Charlotte
• Bank of America
• Mecklenburg County
• Duke Energy
• Arts and Science Council
• Private Contributors
• Arts and Cultural Affiliates • Attorneys
• State of North Carolina
• Architects
• Chamber of Commerce
• Contractors
• Tourism Groups
Critical Agreement Terms
• Purchase Price
• Design Approval
• Property Tax Guarantee
• Minority/Women’s Business Goals
• Construction Period Financing
• Go Dark and Relocation Events
• Permanent Public Financing
• Bechtler Art Agreement
• Acquisition Terms/Schedule
• Privately Funded Operating
Endowment
• Termination Rights
Major Observations
• Negotiate fairly, openly, respectfully, honestly
• Negotiate recognizing that many issues are not mutually exclusive
• Negotiate knowing there will be another day and another project
• Negotiate realizing that the final product must withstand all scrutiny
• Reduce the complex and complicated to its simplest terms
• It is a marathon, not a sprint
• Charlotte/Mecklenburg is built on a strong public/private foundation
Case Study #2
Embassy Suites Hotel and Convention Center
Fayetteville, NC
(Spring 2012)
Case Study #2
Embassy Suites Hotel and Convention Center
Fayetteville, NC
Innovate: State-of-art amenities at minimal costs
Resolve: City negotiated patiently, knowledgeably.
Adapt: City leveraged assets under its control.
Comparing Projects
Cultural Campus
Critical Feature
Hotel & Convention Center

Multiple Funding Sources

Public
Debt Service
Private
7:1
Private/Public Investment Ratio
28:1
Positive
Change to Property Tax Base
Positive
Public Plazas-Ticketed Venues
Access
Guests and Invitees
Cultural, Tourism and
Economic Development
Primary Purpose
Tourism and Economic
Development
Leisure & Business
Primary Users
Business & Leisure

Future Expansion Space

The Future of Public/Private Partnerships
Greater public scrutiny
Standardized economic impact studies
Greater sophistication
More economic development projects
Your Questions and Comments