30:9-23.24 Authority may enter into contract with private entity.

7. a. (1) A county hospital authority may enter into a contract with a private entity, subject to subsection f. of this section, to be referred to as a public-private partnership agreement, that permits the private entity to assume full financial and administrative responsibility for a project, provided that the project is financed in whole or in part by the private entity and that the county or the county hospital authority retains full ownership of the land upon which the project is completed.

(2) As used in this section, "project" means the on-site construction, reconstruction, repair, alteration, improvement, extension, management, or operation of a building, structure, or facility of, or for the benefit of, a county hospital.

(3) A public-private partnership agreement may include an agreement under which a county hospital authority leases to a private entity, in whole or in part, the operation of a revenue-producing facility of a county hospital to which the county or the county hospital authority holds title, in exchange for up-front or structured financing by the private entity for the construction of a building, structure, or facility of, or for the benefit of, the hospital. Under the lease agreement, the county or county hospital authority shall continue to hold title to the facility, and may continue to hold the license of the facility, and the private entity shall be responsible for the management, operation, and maintenance of the facility. A county or county hospital authority is permitted, in its discretion, to assign the right to apply for or acquire the license for the facility to the private entity, provided the county or county hospital authority obtains covenants and conditions from the private entity for the management, operation, or maintenance of the facility. The private entity shall receive some or all, as per the agreement, of the revenue generated by the facility and shall operate the facility in accordance with hospital standards. At the end of the lease term, subsequent revenue generated by the facility, along with management, operation, and maintenance responsibility, shall revert to the county or the county hospital authority.

b. (1) A private entity that assumes financial and administrative responsibility for a project pursuant to subsection a. of this section shall not be subject to the procurement and contracting requirements of any statute applicable to a county hospital authority, including the "Local Public Contracts Law," P.L.1971, c.198 (C.40A:11-1 et seq.). For the purposes of facilitating the financing of a project pursuant to subsection a. of this section, a public entity:

(a) may become the owner or lessee of the project or the lessee of the land, or both,

(b) may become the lessee of a revenue-producing facility to which the county or the county hospital authority holds title,

(c) may issue indebtedness in accordance with the public entity's enabling legislation, and

(d) notwithstanding any provision of law to the contrary, shall be empowered to enter into contracts with a private entity and its affiliates without being subject to the procurement and contracting requirements of any statute applicable to the public entity provided that the private entity has been selected by the county hospital authority pursuant to a solicitation of proposals or qualifications.

(2) For the purposes of this section, a public entity shall include the New Jersey Health Care Facilities Financing Authority, and any project undertaken pursuant to subsection a. of this section of which the authority becomes the owner or lessee, or which is situated on land of which the authority becomes the lessee, shall be deemed a "project" under the "New Jersey Health Care Facilities Financing Authority Law," P.L.1972, c.29 (C.26:2I-1 et seq.).

(3) As the carrying out of any project described pursuant to this section constitutes the performance of an essential public function, a project predominantly used in furtherance of the purposes of a county hospital authority undertaken pursuant to this section, provided it is owned by or leased to a public entity, non-profit business entity, foreign or domestic, or a business entity wholly owned by a non-profit business entity, shall at all times be exempt from property taxation and special assessments of the State, or any municipality, or other political subdivision of the State and, notwithstanding the provisions of section 15 of P.L.1974, c.80 (C.34:1B-15), section 2 of P.L.1977, c.272 (C.54:4-2.2b), or any other section of law to the contrary, shall not be required to make payments in lieu of taxes. The land upon which a project is located shall also at all times be exempt from property taxation. Further, the project and land upon which the project is located shall not be subject to the provisions of section 1 of P.L.1984, c.176 (C.54:4-1.10) regarding the tax liability of private parties conducting for profit activities on tax exempt land, or section 1 of P.L.1949, c.177 (C.54:4-2.3) regarding the taxation of leasehold interests in exempt property that are held by nonexempt parties.

c. The general contractor, construction manager, design-build team, or subcontractor for a project proposed in accordance with this section shall be classified by the Division of Property Management and Construction to perform work on a public-private partnership hospital project.

d. (1) Projects proposed in accordance with this section shall be submitted to the New Jersey Health Care Facilities Financing Authority for its review and approval and, when practicable, are encouraged to adhere to the Leadership in Energy and Environmental Design Green Building Rating System as adopted by the United States Green Building Council.

(2) Where no public fund has been established for the financing of a public improvement, the chief financial officer of the public owner shall require the private entity for whom the public improvement is being made to post, or cause to be posted, a bond guaranteeing prompt payment of moneys due to the contractor, his or her subcontractors and to all persons furnishing labor or materials to the contractor or his or her subcontractors in the prosecution of the work on the public improvement.

e. A general contractor, construction manager, design-build team, or subcontractor shall be registered pursuant to the provisions of P.L.1999, c.238 (C.34:11-56.48 et seq.), and shall be classified by the Division of Property Management and Construction to perform work on a public-private partnership hospital project.

f. (1) All projects proposed in accordance with this section shall be submitted to the New Jersey Health Care Facilities Financing Authority for the authority's review and approval. The projects are encouraged, when practicable, to adhere to the green building manual prepared by the Commissioner of Community Affairs pursuant to section 1 of P.L.2007, c.132 (C.52:27D-130.6).

(2) (a) In order for an application to be complete and considered by the authority, the application shall include, but not be limited to:

(i) a public-private partnership agreement between the county hospital authority and the private developer;

(ii) a full description of the project, including a description of any agreement for the lease of a revenue-producing facility related to the project;

(iii) the estimated costs and financial documentation for the project;

(iv) a timetable for completion of the project extending no more than five years after consideration and approval; and

(v) any other requirements that the authority deems appropriate or necessary.

(b) As part of the estimated costs and financial documentation for the project, the application shall contain a long-range maintenance plan and shall specify the expenditures that qualify as an appropriate investment in maintenance. The long-range maintenance plan shall be approved by the New Jersey Health Care Facilities Financing Authority pursuant to regulations promulgated by the authority that reflect national building maintenance standards and other appropriate building maintenance benchmarks.

(3) The authority shall review all completed applications, and request additional information as is needed to make a complete assessment of the project. No project shall be undertaken until final approval has been granted by the New Jersey Health Care Facilities Financing Authority; provided, however, that the authority shall retain the right to revoke approval if it determines that the project has deviated from the plan submitted pursuant to paragraph (2) of this subsection.

(4) The New Jersey Health Care Facilities Financing Authority may promulgate any rules and regulations necessary to implement this subsection, including provisions for fees to cover administrative costs.

g. Where no public fund has been established for the financing of a public improvement, the chief financial officer of the public owner shall require the private entity for whom the public improvement is being made to post, or cause to be posted, a bond guaranteeing prompt payment of moneys due to the contractor, his or her subcontractors and to all persons furnishing labor or materials to the contractor or his or her subcontractors in the prosecution of the work on the public improvement.

h. The provisions of P.L.2009, c.136 (C.52:18-42 et al.) shall not apply to any project carried out pursuant to this section.

L.2016, c.55, s.7.