Has anyone done a P3 project where the municipality(ies) become members of an LLC along with the private entity (then the LLC owns the improvements)? I'm trying to work through whether there any legal restrictions, pitfalls, etc. The proposed P3 LLC would obtain financing etc.

Teresa Nowlin | City Attorney
211 North Elm | P.O Box 2007 | Jenks, OK 74037
918-299-5883 Office

Not enough information to respond specifically however you should be careful in agreements not to run afoul of Article 10 Section 15 of Oklahoma Constitution.

Oklahoma Constitution
[http://www.oscn.net/Images/Applications/search/WDFolderOpen.gif] http://www.oscn.net/applications/OCISWeb/index.asp?level=1&ftdb=STOKCN#Article10-RevenueandTaxation Article 10 - Revenue and Taxation
[http://www.oscn.net/Images/Applications/search/WDFolderOpen.gif] http://www.oscn.net/applications/OCISWeb/index.asp?level=1&ftdb=STOKCN#InGeneral In General
[http://www.oscn.net/Images/Applications/search/WDDocument.gif] Section Article 10 section 15 - Pledge or loan of credit - Donation - Exceptions
Cite as: O.S. §, __ __

§ 15. Pledge or loan of credit - Donation - Exceptions.

A. Except as provided by this section, the credit of the State shall not be given, pledged, or loaned to any individual, company, corporation, or association, municipality, or political subdivision of the State, nor shall the State become an owner or stockholder in, nor make donation by gift, subscription to stock, by tax, or otherwise, to any company, association, or corporation.

CONFIDENTIALITY NOTE:  This transmission is protected by the Electronic Communications Privacy Act, 18 U.S.C. Sections 2510-2521 and intended to be delivered only to the named addressee(s) This e-mail message is intended only for the personal use of the recipient(s) named above. This message is or may be an attorney-client communication and as such privileged and confidential. If you are not an intended recipient, you may not review, copy or distribute this message. If you have received this communication in error, please notify us immediately by e-mail and delete the original message.

s/ David A. Davis
LAW OFFICE OF DAVID A. DAVIS
4312 N. Classen Blvd.
OKLAHOMA CITY, OK 73118
405 840-6353
405 557-0777 (FAX)
ddavislaw@live.commailto:ddavislaw@live.com

From: Oama oama-bounces@lists.imla.org on behalf of Teresa Nowlin tnowlin@jenksok.org
Sent: Monday, January 6, 2020 10:19 AM
To: oama@lists.imla.org oama@lists.imla.org
Subject: [Oama] P3s

Has anyone done a P3 project where the municipality(ies) become members of an LLC along with the private entity (then the LLC owns the improvements)? I’m trying to work through whether there any legal restrictions, pitfalls, etc. The proposed P3 LLC would obtain financing etc.

Teresa Nowlin | City Attorney

211 North Elm | P.O Box 2007 | Jenks, OK 74037

918-299-5883 Office

I have not done a P3 project as you describe. However, I assume that under 74 O. S. §1004, and LLC might be an appropriate §1004C.2. legal entity for such a project.

Since I have not done one, I cannot advise on the pitfalls, but if you want to obtain financing, I have to assume that assets and/or an income stream are being transferred so as to support a loan or revenue bonds. I would go through the debt approval process comparable to a public trust, with the separate approvals of the LLC's debt by the constituent governmental governing boards.

If the private partner provides all of the financing, I suppose that this might be structured as the purchase price of their interest in the LLC and then you would not have a debt to deal with as such.

I would make very clear, the expression in the record of the purpose - presumably economic development of some specific sort.

Michael R. Vanderburg
Ponca City

From: Oama [mailto:oama-bounces@lists.imla.org] On Behalf Of Teresa Nowlin
Sent: Monday, January 06, 2020 10:20 AM
To: oama@lists.imla.org
Subject: [Oama] P3s

CAUTION: This email originated from outside of the organization. Do not click any links or open any attachments unless you recognize the sender and know the content is safe.

Has anyone done a P3 project where the municipality(ies) become members of an LLC along with the private entity (then the LLC owns the improvements)? I'm trying to work through whether there any legal restrictions, pitfalls, etc. The proposed P3 LLC would obtain financing etc.

Teresa Nowlin | City Attorney
211 North Elm | P.O Box 2007 | Jenks, OK 74037
918-299-5883 Office

Also meant to reference article 10 Section 17

Oklahoma Constitution
[http://www.oscn.net/Images/Applications/search/WDFolderOpen.gif] http://www.oscn.net/applications/OCISWeb/index.asp?level=1&ftdb=STOKCN#Article10-RevenueandTaxation Article 10 - Revenue and Taxation
[http://www.oscn.net/Images/Applications/search/WDFolderOpen.gif] http://www.oscn.net/applications/OCISWeb/index.asp?level=1&ftdb=STOKCN#InGeneral In General
[http://www.oscn.net/Images/Applications/search/WDDocument.gif] Section Article 10 section 17 - Aid to corporations, etc., by counties, cities, towns, etc.
Cite as: O.S. §, __ __

§ 17. Aid to corporations, etc., by counties, cities, towns, etc.

The Legislature shall not authorize any county or subdivision thereof, city, town, or incorporated district, to become a stockholder in any company, association, or corporation, or to obtain or appropriate money for, or levy any tax for, or to loan its credit to any corporation, association, or individual.

CONFIDENTIALITY NOTE:  This transmission is protected by the Electronic Communications Privacy Act, 18 U.S.C. Sections 2510-2521 and intended to be delivered only to the named addressee(s) This e-mail message is intended only for the personal use of the recipient(s) named above. This message is or may be an attorney-client communication and as such privileged and confidential. If you are not an intended recipient, you may not review, copy or distribute this message. If you have received this communication in error, please notify us immediately by e-mail and delete the original message.

s/ David A. Davis
LAW OFFICE OF DAVID A. DAVIS
4312 N. Classen Blvd.
OKLAHOMA CITY, OK 73118
405 840-6353
405 557-0777 (FAX)
ddavislaw@live.commailto:ddavislaw@live.com

From: Oama oama-bounces@lists.imla.org on behalf of david davis ddavislaw@live.com
Sent: Monday, January 6, 2020 10:45 AM
To: Teresa Nowlin tnowlin@jenksok.org; oama@lists.imla.org oama@lists.imla.org
Subject: Re: [Oama] P3s

Not enough information to respond specifically however you should be careful in agreements not to run afoul of Article 10 Section 15 of Oklahoma Constitution.

Oklahoma Constitution
[http://www.oscn.net/Images/Applications/search/WDFolderOpen.gif] http://www.oscn.net/applications/OCISWeb/index.asp?level=1&ftdb=STOKCN#Article10-RevenueandTaxation Article 10 - Revenue and Taxation
[http://www.oscn.net/Images/Applications/search/WDFolderOpen.gif] http://www.oscn.net/applications/OCISWeb/index.asp?level=1&ftdb=STOKCN#InGeneral In General
[http://www.oscn.net/Images/Applications/search/WDDocument.gif] Section Article 10 section 15 - Pledge or loan of credit - Donation - Exceptions
Cite as: O.S. §, __ __

§ 15. Pledge or loan of credit - Donation - Exceptions.

A. Except as provided by this section, the credit of the State shall not be given, pledged, or loaned to any individual, company, corporation, or association, municipality, or political subdivision of the State, nor shall the State become an owner or stockholder in, nor make donation by gift, subscription to stock, by tax, or otherwise, to any company, association, or corporation.

CONFIDENTIALITY NOTE:  This transmission is protected by the Electronic Communications Privacy Act, 18 U.S.C. Sections 2510-2521 and intended to be delivered only to the named addressee(s) This e-mail message is intended only for the personal use of the recipient(s) named above. This message is or may be an attorney-client communication and as such privileged and confidential. If you are not an intended recipient, you may not review, copy or distribute this message. If you have received this communication in error, please notify us immediately by e-mail and delete the original message.

s/ David A. Davis
LAW OFFICE OF DAVID A. DAVIS
4312 N. Classen Blvd.
OKLAHOMA CITY, OK 73118
405 840-6353
405 557-0777 (FAX)
ddavislaw@live.commailto:ddavislaw@live.com

From: Oama oama-bounces@lists.imla.org on behalf of Teresa Nowlin tnowlin@jenksok.org
Sent: Monday, January 6, 2020 10:19 AM
To: oama@lists.imla.org oama@lists.imla.org
Subject: [Oama] P3s

Has anyone done a P3 project where the municipality(ies) become members of an LLC along with the private entity (then the LLC owns the improvements)? I’m trying to work through whether there any legal restrictions, pitfalls, etc. The proposed P3 LLC would obtain financing etc.

Teresa Nowlin | City Attorney

211 North Elm | P.O Box 2007 | Jenks, OK 74037

918-299-5883 Office

I agree with David's warning.

However, I am not sure if the courts will interpret the constitutional provision as preventing a purely governmental LLC, an entity that did not exists at the time of the adoption of the constitution. Clearly the local governments cannot invest in a private corporation.

MRV

From: Oama [mailto:oama-bounces@lists.imla.org] On Behalf Of david davis
Sent: Monday, January 06, 2020 10:46 AM
To: Teresa Nowlin; oama@lists.imla.org
Subject: Re: [Oama] P3s

CAUTION: This email originated from outside of the organization. Do not click any links or open any attachments unless you recognize the sender and know the content is safe.

Not enough information to respond specifically however you should be careful in agreements not to run afoul of Article 10 Section 15 of Oklahoma Constitution.

Oklahoma Constitution
[http://www.oscn.net/Images/Applications/search/WDFolderOpen.gif] http://www.oscn.net/applications/OCISWeb/index.asp?level=1&ftdb=STOKCN#Article10-RevenueandTaxation Article 10 - Revenue and Taxation
[http://www.oscn.net/Images/Applications/search/WDFolderOpen.gif] http://www.oscn.net/applications/OCISWeb/index.asp?level=1&ftdb=STOKCN#InGeneral In General
[http://www.oscn.net/Images/Applications/search/WDDocument.gif] Section Article 10 section 15 - Pledge or loan of credit - Donation - Exceptions
Cite as: O.S. §, __ __

§ 15. Pledge or loan of credit - Donation - Exceptions.

A. Except as provided by this section, the credit of the State shall not be given, pledged, or loaned to any individual, company, corporation, or association, municipality, or political subdivision of the State, nor shall the State become an owner or stockholder in, nor make donation by gift, subscription to stock, by tax, or otherwise, to any company, association, or corporation.

CONFIDENTIALITY NOTE:  This transmission is protected by the Electronic Communications Privacy Act, 18 U.S.C. Sections 2510-2521 and intended to be delivered only to the named addressee(s) This e-mail message is intended only for the personal use of the recipient(s) named above. This message is or may be an attorney-client communication and as such privileged and confidential. If you are not an intended recipient, you may not review, copy or distribute this message. If you have received this communication in error, please notify us immediately by e-mail and delete the original message.

s/ David A. Davis
LAW OFFICE OF DAVID A. DAVIS
4312 N. Classen Blvd.
OKLAHOMA CITY, OK 73118
405 840-6353
405 557-0777 (FAX)
ddavislaw@live.commailto:ddavislaw@live.com

From: Oama oama-bounces@lists.imla.org on behalf of Teresa Nowlin tnowlin@jenksok.org
Sent: Monday, January 6, 2020 10:19 AM
To: oama@lists.imla.org oama@lists.imla.org
Subject: [Oama] P3s

Has anyone done a P3 project where the municipality(ies) become members of an LLC along with the private entity (then the LLC owns the improvements)? I'm trying to work through whether there any legal restrictions, pitfalls, etc. The proposed P3 LLC would obtain financing etc.

Teresa Nowlin | City Attorney

211 North Elm | P.O Box 2007 | Jenks, OK 74037

918-299-5883 Office

Also, do not overlook 74 O. S. §5152 et seq.

Mike V

From: Oama [mailto:oama-bounces@lists.imla.org] On Behalf Of Michael R. Vanderburg
Sent: Monday, January 06, 2020 10:55 AM
To: 'david davis'; Teresa Nowlin; oama@lists.imla.org
Subject: Re: [Oama] P3s

CAUTION: This email originated from outside of the organization. Do not click any links or open any attachments unless you recognize the sender and know the content is safe.

I agree with David's warning.

However, I am not sure if the courts will interpret the constitutional provision as preventing a purely governmental LLC, an entity that did not exists at the time of the adoption of the constitution. Clearly the local governments cannot invest in a private corporation.

MRV

From: Oama [mailto:oama-bounces@lists.imla.org] On Behalf Of david davis
Sent: Monday, January 06, 2020 10:46 AM
To: Teresa Nowlin; oama@lists.imla.org
Subject: Re: [Oama] P3s

CAUTION: This email originated from outside of the organization. Do not click any links or open any attachments unless you recognize the sender and know the content is safe.

Not enough information to respond specifically however you should be careful in agreements not to run afoul of Article 10 Section 15 of Oklahoma Constitution.

Oklahoma Constitution
[http://www.oscn.net/Images/Applications/search/WDFolderOpen.gif] http://www.oscn.net/applications/OCISWeb/index.asp?level=1&ftdb=STOKCN#Article10-RevenueandTaxation Article 10 - Revenue and Taxation
[http://www.oscn.net/Images/Applications/search/WDFolderOpen.gif] http://www.oscn.net/applications/OCISWeb/index.asp?level=1&ftdb=STOKCN#InGeneral In General
[http://www.oscn.net/Images/Applications/search/WDDocument.gif] Section Article 10 section 15 - Pledge or loan of credit - Donation - Exceptions
Cite as: O.S. §, __ __

§ 15. Pledge or loan of credit - Donation - Exceptions.

A. Except as provided by this section, the credit of the State shall not be given, pledged, or loaned to any individual, company, corporation, or association, municipality, or political subdivision of the State, nor shall the State become an owner or stockholder in, nor make donation by gift, subscription to stock, by tax, or otherwise, to any company, association, or corporation.

CONFIDENTIALITY NOTE:  This transmission is protected by the Electronic Communications Privacy Act, 18 U.S.C. Sections 2510-2521 and intended to be delivered only to the named addressee(s) This e-mail message is intended only for the personal use of the recipient(s) named above. This message is or may be an attorney-client communication and as such privileged and confidential. If you are not an intended recipient, you may not review, copy or distribute this message. If you have received this communication in error, please notify us immediately by e-mail and delete the original message.

s/ David A. Davis
LAW OFFICE OF DAVID A. DAVIS
4312 N. Classen Blvd.
OKLAHOMA CITY, OK 73118
405 840-6353
405 557-0777 (FAX)
ddavislaw@live.commailto:ddavislaw@live.com

From: Oama oama-bounces@lists.imla.org on behalf of Teresa Nowlin tnowlin@jenksok.org
Sent: Monday, January 6, 2020 10:19 AM
To: oama@lists.imla.org oama@lists.imla.org
Subject: [Oama] P3s

Has anyone done a P3 project where the municipality(ies) become members of an LLC along with the private entity (then the LLC owns the improvements)? I'm trying to work through whether there any legal restrictions, pitfalls, etc. The proposed P3 LLC would obtain financing etc.

Teresa Nowlin | City Attorney

211 North Elm | P.O Box 2007 | Jenks, OK 74037

918-299-5883 Office