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P3 Digest for November 30, 2017

Dominique Lueckenhoff Brings a P3 Approach to Community-Based Stormwater Management

Editor’s Note: The following article is one in a series of six profiles of winners of NCPPP’s 2017 National Public-Private Partnership Awards, which recognize organizations and individuals who have gone above and beyond to advance the concept and implementation of P3s across the country. The winners will be honored during P3Connect in Miami Beach in January.

“Innovation is taking two things that already exist and putting them together in a new way.” — Tom Freston

States and localities throughout the nation are struggling to find reliable, cost-effective ways to prevent stormwater runoff from reaching — and polluting — major waterways. Failure to address this major cause of water pollution is endangering health and safety, while increasing the liabilities of communities with permit compliance requirements under the Clean Water Act. However, local government efforts to develop solutions often have been hampered by limited public funding for construction or capacity to implement larger scale projects. This is particularly true for greener stormwater infrastructure projects.

Dominique Lueckenhoff is an innovative problem solver whose commitment and dedication to public service goes far beyond the conventional government worker. She has a real passion for creating a safer, cleaner environment, particularly when it comes to safe, clean water, and has dedicated much of her life to helping local leaders bring beautification, resiliency and better living conditions to their citizens. While serving as deputy director of the EPA Region III’s water protection division (which covers Del., the Washington, D.C., Md., Pa., Va. and W.Va.), Lueckenhoff saw firsthand the many challenges cities, towns and counties struggle face. She knew there had to better ways to help them achieve clean water regulatory compliance, while also providing economic benefits that would empower and sustain these communities. To take action, she actively engaged and convened groups of nationally recognized public and private experts and stakeholders for a series of roundtables to gather insights and ideas on how to provide greener, better performing stormwater management, while identifying ways to reduce design, construction, and operations and maintenance costs. She also recognized the potential of these projects to provide added benefits to communities, such as job creation, workforce development and reinvestment in the local economy.

The discussions culminated in a series of recommendations favoring the use of non-traditional project delivery and alternative financing approaches — both of which are emblematic of P3s — to expedite the cost-effective development, implementation and maintenance of large-scale green infrastructure projects throughout the region and, potentially, nationwide. Tapping private sector expertise, performance-based business models and capacity also was a top recommendation.

Lueckenhoff drew inspiration from her years of experience in government — having supported successful public and private initiatives, as well as her working knowledge and further research related to P3 solutions from a variety of sectors — in her search for innovative solutions for the stormwater infrastructure challenges.  She particularly was intrigued by the P3 model the Department of Defense developed to address its huge shortfall of adequate housing for military personnel. Under a family housing privatization initiative DOD launched in the late 1990s, private developers took over the military’s roles of building, owning and maintaining on-base rental housing as a long-term business investment. Through this “partnership”, DOD succeeded in meeting its goal of revitalizing all of its substandard housing by 2007.

“This military housing model provided significant leveraging of public dollars through private funding — attracting $10 to $14 for every dollar paid by the public — to cover the design, construction, financing, operation and maintenance of DOD’s military housing portfolio,” Lueckenhoff explained. “I began to think about how I could apply this type of model to that of green stormwater infrastructure.”

She recognized the potential to use the P3 delivery model to solve a community’s stormwater runoff problems and, in the process, some of their economic and social challenges.

“I began thinking about how a stormwater P3, particularly one delivering a significant amount of green infrastructure, including the use of newer, higher performing materials, technologies and designs, could spur local economic revitalization through development of new types of businesses, along with the growth of existing ones and, thereby, more and different types of jobs for residents. I realized that this could also create educational and training opportunities and improve real estate values, which drives increased urban renewal. In short, I began to see how the traditional P3 model could be adapted to create a community-based one for these purposes” Lueckenhoff explained.

She, along with many others across the country, also believed that promoting such green infrastructure projects could achieve other environmental gains, such as air quality improvement and reduction in the heat island effect — rising temperatures that are the cause of hundreds of deaths in built-out, urban areas. Her ultimate goal was to prove that clean water infrastructure investments not only would create jobs, but provide cost benefits for communities, along with the necessary financial returns for private firms by producing: in her words, “faster, cheaper, greener”.

With these goals in mind, she worked with interested leaders in Prince George’s County, Md., to develop a performance-based pilot project to launch the first-ever “Community-Based Public-Private Partnership” (CBP3), which would embed community improvement priorities while improving the county’s stormwater management efforts to address water quality improvements.

Together, Prince George’s County and EPA Region III introduced the Clean Water Partnership, the first integrated green stormwater infrastructure CBP3 pilot, in 2014. Under the pilot, Corvias, a private company that works with public agencies on environmental, energy and infrastructure projects, is conducting a $100 million green infrastructure retrofit with the county’s department of the environment. The first phase involves retrofitting 2,000 acres of public and private land with stormwater management infrastructure over three years to help Prince George’s comply with its municipal separate storm sewer system permit requirements. The county’s ultimate goal is to convert 15,000 acres of impervious surfaces into surfaces that soak up or treat rainwater, primarily by installing 46,000 stormwater devices such as rain gardens, cisterns and permeable pavements.

The size and scope of the project, along with its tight timeline and low cost — no more than $50,000 per acre — had never been attempted before. Such projects, in urbanized areas, when delivered through government, typically range from $250,000 to $500,000 per acre, in part because of inefficiency in executing infrastructure design, construction, inspection and maintenance. Allowing the private sector to participate in the project has enabled the use of innovative technology and cutting-edge project management expertise, along with economies of scale to stay ahead of schedule and on or below budget, with portions being delivered at less than $40,000 per acre.

It also is worth noting that 96 percent of the work is being conducted by local businesses, exceeding the 90 percent local employment target the set by the county. During the first 100 days of the partnership, Corvias subcontracted more than $5.7 million of work, $3.4 million of which is being performed by small, local businesses. The firm also launched a mentor-protégé program through which select local businesses receive specialized training to boost the county’s economy and bolster the growth of companies that can perform high-quality environmental and project management work there. And word of local employment opportunities has spread. Lueckenhoff also heard from the head of an engineering firm that started an internship to provide a gateway for University of Maryland engineering students to work and get hands-on experience; a reflection of the firm’s excitement about the partnership program. The program also has spawned the creation of up to 10 women-owned and -staffed firms that are working on it as well, she reported.

Lueckenhoff stressed, however, that the success of this CBP3 approach to improving environmental infrastructure hinges on a high level of local participation. “To make a community-based P3 work, there has to be a high level, of not only local involvement, but leadership. The Prince George’s County environmental and engineering departments have been working on this initiative every step of the way and getting buy-in from businesses, churches, schools and residents to install stormwater management retrofits on their property has also been a pivotal component of success,” she explained.

The EPA and the White House Council on Environmental Quality have highlighted the project and the CBP3 approach and the pilot have been hailed by national media outlets as a model of environmental stewardship that support and is supported by Prince George’s County. The American Society of Civil Engineers recently hailed it as a “game changer” for infrastructure in the country.

Far from content to rest on her laurels, Lueckenhoff is pursuing more opportunities to spark CBP3 projects in other parts of the region. EPA developed a guide, along with a CBP3 toolkit, which includes a number of model partnership documents, to help other communities familiarize themselves with and adopt the CBP3 model. She also has been working with the socio-economically depressed city of Chester, Pa., to drive significant economic development and community improvement through the use of the CBP3 approach. Her efforts have resulted in a more than $50 million investment, which will help spur the city’s economic renewal and eliminate local flooding and improved protection for local streams and the Delaware River. Chester’s CBP3 has attracted interest from other communities, five of which have asked for assistance in starting stormwater authorities based on Chester’s CBP3 model.

Lueckenhoff has acknowledged the value in taking a P3 approach to stormwater management and other green infrastructure projects.

“I have been on a mission to learn more about the P3 world from the perspective of an investor. That’s why it has been useful to work with NCPPP, which offers the opportunity to work and network with P3 practitioners, legal professionals, regulators, communities, academia and green infrastructure experts,” she said. “Gathering all of these different people together has not only given us a sense of the extent of the problem, but also a sense that we can fix this. The CBP3 model shows how to use the market to drive innovative solutions that serve our communities, while putting the community and its values first. This type of impact is what sells the approach. It is good government — at all levels — to show how we’re getting cost-effective solutions that the community cares about.”

NCPPP is honoring Dominique Lueckenhoff with its Excellence in Individual Leadership Award for her success in using the P3 procurement model to help communities develop innovative stormwater management strategies and activities that also spurred local socio-economic development.

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