For Tribal governments, information technology (IT) is a powerful tool that facilitates rapid communication, enables the efficient delivery of public services and enhances public health, welfare and safety. As such, a stable, robust IT infrastructure is becoming more critical than ever for Tribal governments to meet the demands of citizens, businesses and the community. Given this, many Tribal IT departments are being pushed to provide more and higher levels of services—often with infrastructures that are already stretched beyond capacity.
To support current and future demand much of the existing IT infrastructure must be upgraded or in some cases, entirely overhauled. However, IT upgrades and overhauls do not come cheap—they typically require high capital outlays both initially and to support long-term maintenance and support.
Unfortunately, securing funding to support Tribal IT projects is more difficult than ever before. The persistent economic slowdown and steep cuts in Federal spending have resulted in Tribal IT budgets being cut to the bone. And with regular revenue sources such as formula grants and allocations being pared down as well, Tribal IT departments are increasingly turning to discretionary state and Federal grants to fund IT projects.
A discretionary grant is defined as a nonrefundable, budget line grant awarded on a competitive basis. Discretionary grants permit the Federal government, according to legislation, to exercise wide latitude and judgment in selecting both the projects to be supported and the recipients. In other words, discretionary grant programs are ones in which applicants must demonstrate that their projects are well planned, feasible and sustainable, while also addressing the program goals and priorities.
On average, only up to about five percent of grant proposals submitted are awarded funding. With some programs, it’s closer to one percent. Considering that some discretionary grant programs receive close to a thousand applications for funding, it’s no surprise that competition for grant dollars is fierce.
With this in mind, it is clear that Tribal IT departments need to use every tool at their disposal to develop a competitive grant proposal that gets funded. Collaborations and partnerships are two such tools that many tribes are using to leverage resources and demonstrate support and commitment to a project’s long-term success, both of which are important elements of a successful approach to funding.
A Public-Private Partnership (PPP)—which is both a partnership and a collaboration—is among the most indispensible strategies a Tribal IT department can use to secure project grant dollars. A PPP is a formal partnership between a governmental entity and one or more private sector firms. The specific terms of the PPP and associated roles and responsibilities of each partner are outlined in a formal contract.
Public-Private Partnerships can take a variety of forms
PPPs can take a variety of different forms. In fact, the National Center for Public Private Partnerships (www.ncppp.org) lists 18 different types of commonly-used public private partnerships. However, not all of these would be suitable for developing a grant-funded IT infrastructure project. For instance, in nearly all cases involving Federal grants, the Tribe will be the applicant and fiscal agent, receiving, managing and disbursing the grant dollars. Because the Tribe is accountable to the Federal government in managing the funds, it generally retains ownership of the asset. Support, operations, maintenance and other services can be provided on a contractual basis but the asset itself usually remains the property of the Tribe. Keeping this general model in mind, here are a few common PPP structures that Tribal IT departments might consider using to support their infrastructure projects:
- Design-Build (DB): In this type of partnership, the private partner provides both project-related design and construction services for the Tribe. This type of partnership can save both time and money while providing stronger guarantees of project success while transferring a degree of project risk to the private partner. The DB PPP can also reduce conflict by allowing for a single entity to be responsible to the Tribe for both design and construction of the project. The Tribe retains ownership of the asset and is responsible for its operation and maintenance.
- Design-Build-Maintain (DBM): This PPP is very similar to the Design-Build model above with the key difference being that for a mutually agreed-upon time period, the private sector partner assumes responsibility for maintaining the infrastructure. The Tribe retains ownership of the asset. The partnership model has the benefit of transferring some of the maintenance risk to the private sector partner.
- Design-Build-Operate (DBO): Through this partnership arrangement, a single contract is awarded to a private sector firm for the design, construction, and operation of an IT infrastructure project, although the Tribe retains ownership of the finished project. Particularly for large, complex projects, this type of PPP runs contrary to the traditional contracting model where different parties are responsible for different project areas (e.g., design, construction, etc.). The DBO is useful because it creates a single point of responsibility for design and construction. This can have the added benefit of speeding up the project timeline, which is especially useful for complex projects that involve activities such as construction, burying fiber or placing towers. For tribes that are located in northern climates, remote regions and mountainous areas, this can be an important consideration because geographic- or climate-related delays are common, leading to costly overruns.
- Design-Build-Operate-Maintain (DBOM): This model represents an integrated partnership that combines the design and construction with operations and maintenance. In this partnership, each of these four components is the primary responsibility of the private sector partner. However, the Tribe retains ownership of the project and provides a high degree of project oversight.
In the next post I’ll discuss the benefits of public-private partnerships and provide more information about what to look for in a good partnership as well as steps for identifying potential public-private partnerships.
