Public Private Partnerships in Saint-Petersburg
Public Private Partnerships (PPPs) are the long-term mutually advantageous cooperation between the state and private sectors for the purpose of the effective and qualitative realization of the publicly significant projects.
The PPP mechanism makes it possible to not only to assign the means on the realization of the projects that are socially significant for the city, but also to find the most contemporary technical solutions and to effectively govern the properties created.
According to the estimates of the World Bank, in Saint-Petersburg at the present moment some of the largest projects in the world are being fulfilled with the use of the public private partnership mechanism.
Normative-legal regulation of PPPs.
PPP Projects in Saint-Petersburg
Saint-Petersburg has become one of the first subjects of the Russian Federation which began to use the PPP mechanisms in the implementation of investment projects. Various infrastructure projects that are most significant for the city are being implemented on the basis of PPPs.
Useful links:
The basic normative-legal acts
In 2006, the law of Saint-Petersburg “on the participation of Saint-Petersburg in public-private partnerships”, was passed, which made it possible to stimulate private investment in PPP projects due to an increase in transparency and the absence of limitations on the forms of application, the providing for such forms, and guarantees that the property rights of the constructed property belong to the investor. This makes it possible for an investor to take borrowed means under more advantageous conditions.
The law makes it possible for Saint-Petersburg to define the parameters of concrete projects in the tender documentation; therefore the position of the law is applicable as to major and as to small projects. Furthermore, the law of Saint-Petersburg to a larger degree guarantees the rights of the investor, including according to changes in the legislation or the detection of overloading of a given land plot to an investor which had been unknown earlier.
The operation of the Committee on Investments and Strategic Projects and its partners within the framework of the pilot infrastructure projects has caused interest in mechanisms for the attraction of private investment and in other spheres. The obvious need for expanding the field of uses of PPPs and the experience of the committee have contributed to the fact that the government of Saint Petersburg made the decision to create a special structure which deals with PPP projects. This structure has been created within the framework of the Committee and bears the name “The Administration of Public Private Partnership Projects and Legal Support”.
With the use of the experience of Saint-Petersburg and the World Bank in the sphere of the realization of PPP projects a mechanism has been developed according to which within the sphere of the responsibility of the PPP administration there has been included the evaluation of projects and the development of proposals where under the themes of how to prepare, to realize and to accomplish the subsequent control during the period of the realization of project are covered. This complex standardized approach makes it possible to prepare projects to a high standard, which is intelligible to foreign investors and convenient for the organs of state power.
Furthermore for the realization of less major projects at present into the law on PPP has been modified with some introduced changes through the law of Saint Petersburg “on the introduction of changes in the separate laws of Saint-Petersburg”, which was passed by the legislative assembly of Saint-Petersburg on 01.12.2010
МThe PPP mechanisms can be used not only in the implementation of socially significant projects, but also for the development and formation of public health and social services for the population, in physical culture, in sport, in tourism, in transportation and engineering infrastructure, and on the infrastructure of telecommunications.
Also changes were introduced by way of the assignment of land plots for the implementation of PPP projects.
A number of changes to the PPP law will also make it possible to use the public private partnership mechanism in cases when this is necessarily for the purposes of the performance of other investment agreements concluded by Saint-Petersburg under established legislative orders, or for the fulfilment of other socially significant projects in accordance with transactions concluded by Saint-Petersburg.
The change indicated will enlarge the possibilities of the participation of Saint Petersburg in public private partnerships and the regulation of inter-relations with investors.
At present, on the basis PPP the Committee is aiding the following major investment projects.
The project of the building of the Orlovsky Tunnel under the river Neva is being realized on the basis of the federal law “on concessional agreements”. On the basis of the law of Saint Petersburg “on the participation of Saint-Petersburg in public-private partnerships” two major projects are also being achieved:
Also a preliminary preparation of PPP projects is being made in the sphere of housing and utilities (water and heat supplies, electricity and the like), the development of transportation infrastructure and in the social sphere (the building of socially significant items - schools, hospitals and so on).
Tenders for PPP projects
On 31 March 2011 there was the announcement of the results of the open tender for the right to conclude an Agreement on the creation and operation on the basis of a public-private partnership of buildings, that are intended for housing educational institutions on the territory of the Pushkinskiy disctrict of Saint-Petersburg and an agreement on the lease of land plots
The winner of the tender was acknowledged as being OOO "Controlling Company "Peremena".
The signing of the agreement with the investor will take place on 1 June 2011.
At present the Committee has declared tenders for the realization of the following projects: