Get It Right When Pursuing Unsolicited Proposals

By Ed Green
P3 Kentucky Editor

When Kentucky’s public-private partnership legislation took effect last year, we recognized that one of the more interesting elements of it was the ability for professional firms and investors to offer state and local agencies ideas for unsolicited projects — solutions to some of the challenges faced by communities and leaders.

Kentucky Tourism, Arts and Heritage Cabinet Secretary Don Parkinson told me earlier this year that he agreed. Parkinson said in some ways he prefers to receive unsolicited proposals because they offer creative, money-saving solutions that traditionally have not been considered by agency officials. This is the private sector’s best opportunity to provide business-minded solutions to government challenges.

As we’ve written before, our view is that this has been an underutilized tool, as only a handful of potential projects have been announced that started as unsolicited proposals, including a proposal to manage food services and retail operations at the Kentucky Horse Park in Lexington.

Since one of our primary goals is to offer not just to share information about P3 projects but also provide education and insights about the process, we’ve talked with state leaders about unsolicited proposals and what might be slowing down the flow of deals. One of the things we learned is that while many of the deals that have been proposed have been thoughtful, innovative ideas, some have not provided the details state leaders need to evaluate them. Additionally, some investors and vendors proposing ideas don’t fully understand the P3 process.

So I’m providing the following dos and don’ts for unsolicited proposals based on my conversations with state leaders and consultation with some of our P3 Roundtable members.

  1. Read the regulations and statutes closely. Just as we suggested last week for agency decision-makers, knowing the rules is an important first step to navigating the P3 process. For those seeking to submit an unsolicited proposal, review Section 12 of the Kentucky Revised Statute and Section 3 of the Kentucky Administrative Regulation.  (You can find links to the legislation, regulations and statutes here.)
  2. Don’t discuss your idea with agency officials. This may seem counter-intuitive for someone trying to provide just the right product or service for a government entity, but remember this P3 process is an extension of the state’s public procurement process. This is designed to be a fair and transparent process. As a result, Section 3(5)(a)(b) of the regulation state’s that agencies cannot provide direction or endorsement regarding the drafting of the content of an unsolicited proposal. Private entities must submit their own ideas for review, at which point agency officials will determine how to move forward.
  3. Provide a clear picture of your plan. Ideas are great but typically not sufficient for elected or appointed officials to determine their value. An unsolicited proposal should include a bright idea, but also at least the beginnings of a business plan to help evaluate whether the idea is technically feasible.
  4. Provide as much financial detail as possible. This isn’t always easy, but it’s important to help officials determine if your idea is financially viable. You probably won’t have all the numbers, but use the ones you have access to and show how the state would be better-served by your idea. A P3 is intended to be used only if officials determine it is the “most advantageous method of awarding and administering a capital project or other contract.” Make sure your case shows that you have a better way of doing things.
  5. Protect your proprietary information. The statute requires you to take steps to protect your proprietary information from your competitors. If the proposal includes trade secrets, financial records or other information that shouldn’t be shared publicly, you must include a letter stating that the proposal contains proprietary information, mark those portions as confidential or proprietary, submit a second copy from which that information is redacted. If you fail to take these steps, everything in the proposal could become a public document that everyone can access.

P3 Kentucky was created to educate and connect, so if you have a question about where to go next, feel free to reach out: (502) 544-2917 or ed@c2strategic.com.

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