Florida Senate - 2014                        COMMITTEE AMENDMENT
       Bill No. CS for SB 900
       
       
       
       
       
       
                                Ì4905362Î490536                         
       
                              LEGISLATIVE ACTION                        
                    Senate             .             House              
                  Comm: RCS            .                                
                  03/25/2014           .                                
                                       .                                
                                       .                                
                                       .                                
       —————————————————————————————————————————————————————————————————




       —————————————————————————————————————————————————————————————————
       following:
       
    1         Senate Amendment (with title amendment)
    2  
    3         Delete everything after the enacting clause
    4  and insert:
    5         Section 1. Section 1013.505, Florida Statutes, is created
    6  to read:
    7         1013.505 Public-Private Partnerships; state universities.-
    8         (1) DEFINITIONS.–As used in this section, the term:
    9         (a) “Debt” means bonds, including revenue bonds issued
   10  pursuant to s. 11(d), Art. VII of the State Constitution, loans,
   11  promissory notes, lease-purchase agreements, certificates of
   12  participation, installment sales, leases, or any other financing
   13  mechanism or financial arrangement, whether or not a debt for
   14  legal purposes, for financing or refinancing for or on behalf of
   15  a state university or a direct-support organization or for the
   16  acquisition, construction, improvement, or purchase of capital
   17  outlay projects.
   18         (b) “Board” means a state university board of trustees.
   19         (c) “Comprehensive agreement” or “agreement” means an
   20  agreement between a state university or a direct-support
   21  organization and a private entity which permits the private
   22  entity to assume financial and administrative responsibility for
   23  the acquisition, construction, reconstruction, improvement,
   24  purchase, management, or operation of a project of, or for the
   25  benefit of, the state university or a direct-support
   26  organization. Additionally, a public-private partnership
   27  agreement may also provide for a state university or direct
   28  support organization to transfer to a private entity the
   29  operation of a revenue-producing project to which the state
   30  university or direct-support organization holds title, in
   31  exchange for either a payment or payments to the state
   32  university or direct-support organization or the construction of
   33  a project to benefit the state university or direct-support
   34  organization.
   35         (d) “Develop” means to plan, design, finance, lease,
   36  acquire, install, construct, or expand.
   37         (e) “Direct-support organization” means an organization
   38  created pursuant to s. 1004.28 or any entity specifically
   39  established to incur debt.
   40         (f) “Fees” means charges imposed by the private entity of a
   41  qualifying project for use of all or a portion of such
   42  qualifying project pursuant to a comprehensive agreement.
   43         (g) “Lease payment” means any form of payment, including a
   44  land lease, by a board or direct-support organization to the
   45  private entity of a qualifying project for the use of the
   46  project.
   47         (h) “Material default” means a nonperformance of its duties
   48  by the private entity of a qualifying project which jeopardizes
   49  adequate service to the public from the project.
   50         (i) “Operate” means to finance, maintain, improve, equip,
   51  modify, or repair.
   52         (j) “Private entity” means a natural person, corporation,
   53  general partnership, limited liability company, limited
   54  partnership, joint venture, business trust, public-benefit
   55  corporation, nonprofit entity, or other private business entity.
   56         (k) “Proposal” means a plan for a qualifying project with
   57  detail beyond a conceptual level for which terms such as fixing
   58  costs, payment schedules, financing, deliverables, and project
   59  schedule are defined.
   60         (l) “Qualifying project” means one or more buildings,
   61  structures, or facilities that serves a public educational,
   62  research, housing, parking, infrastructure, recreational, or
   63  cultural purpose of a state university or direct-support
   64  organization that will be used by or on behalf of a state
   65  university or direct-support organization. It also means the
   66  monetization of the operation of a revenue-producing project to
   67  which the board or direct-support organization holds title, in
   68  exchange for a guaranteed payment to the board or direct-support
   69  organization.
   70         (m) “Revenues” means those revenues authorized under s.
   71  1010.62, except that money received as grants or otherwise from
   72  the Federal Government, a public entity, or an agency or
   73  instrumentality in aid of a qualifying project or gifts from
   74  private donors that are donated for the purpose of constructing
   75  or equipping a facility may be used without limitation, unless a
   76  gift is used to secure debt, in which event the maturity of the
   77  debt shall not exceed 5 years.
   78         (n) “Service contract” means a contract between a board or
   79  direct-support organization and the private entity which defines
   80  the terms of the services to be provided with respect to a
   81  qualifying project.
   82         (2) LEGISLATIVE FINDINGS AND INTENT.—
   83         (a)1.The Legislature finds that there is a public need for
   84  the construction or upgrade of facilities that are used
   85  predominantly for public purposes and that it is in the public’s
   86  interest to provide for the construction or upgrade of such
   87  facilities.
   88         2.The Legislature also finds that:
   89         a.There is a public need for timely and cost-effective
   90  acquisition, design, construction, improvement, renovation,
   91  expansion, equipping, maintenance, operation, implementation, or
   92  installation of projects serving a public purpose, including
   93  educational and auxiliary facilities and projects within the
   94  state which serve a public need and purpose, and that such
   95  public need may not be wholly satisfied by existing procurement
   96  methods.
   97         b.There are inadequate resources to develop new
   98  educational and auxiliary facilities and projects for the
   99  benefit of residents of this state, and that a public-private
  100  partnership has demonstrated that it can meet the needs by
  101  improving the schedule for delivery, lowering the cost, and
  102  providing other benefits to the public.
  103         c.There may be state and federal tax incentives that
  104  promote partnerships between public and private entities to
  105  develop and operate qualifying projects.
  106         d.A procurement under this section serves the public
  107  purpose of this section if such procurement facilitates the
  108  timely development or operation of a qualifying project.
  109         (b)It is the intent of the Legislature to encourage
  110  investment in the state by private entities; to facilitate
  111  various bond financing mechanisms, private capital, and other
  112  funding sources for the development and operation of qualifying
  113  projects, including expansion and acceleration of such financing
  114  to meet the public need; and to provide the greatest possible
  115  flexibility to public and private entities contracting for the
  116  provision of public services.
  117         (3)PROCUREMENT PROCEDURES.—A board or direct-support
  118  organization may receive unsolicited proposals or may solicit
  119  proposals for qualifying projects and may thereafter enter into
  120  an agreement with a private entity, or a consortium of private
  121  entities, to build, upgrade, operate, own, or finance
  122  facilities.
  123         (a)The Board of Governors may establish a reasonable
  124  application fee for the submission of an unsolicited proposal to
  125  a board or direct-support organization under this section. The
  126  fee must be sufficient to pay the costs of evaluating the
  127  proposal. A board or direct-support organization may engage the
  128  services of a private consultant to assist in the evaluation.
  129  The Board of Governors may also establish a reasonable fee that
  130  may be charged by a board or direct-support organization to
  131  cover the costs of evaluating all other proposals received by a
  132  board or direct-support organization as part of a competitive
  133  procurement process to select a private entity for purposes of
  134  establishing a public-private partnership.
  135         (b)A board or direct-support organization may request a
  136  proposal from private entities for a public-private project or,
  137  if the board or direct-support organization receives an
  138  unsolicited proposal for a public-private project and the board
  139  or direct-support organization intends to enter into a
  140  comprehensive agreement for the project described in such
  141  unsolicited proposal, the board or direct-support organization
  142  shall publish notice in a newspaper of general circulation at
  143  least once a week for 2 weeks stating that the board or direct
  144  support organization has received a proposal and will accept
  145  other proposals for the same project. The timeframe within which
  146  the board or direct-support organization may accept other
  147  proposals shall be determined on a project-by-project basis
  148  based upon the complexity of the project and the public benefit
  149  to be gained by allowing a longer or shorter period of time
  150  within which other proposals may be received; however, the
  151  timeframe for allowing other proposals must be at least 21 days,
  152  but no more than 120 days, after the initial date of
  153  publication.
  154         (c)In considering an unsolicited proposal, the board or
  155  direct-support organization may require the private entity to
  156  provide a technical study prepared by a nationally recognized
  157  expert with experience in preparing analyses for bond rating
  158  agencies. In evaluating the technical study, the board or
  159  direct-support organization may rely upon internal staff reports
  160  prepared by personnel familiar with the operation of similar
  161  facilities or the advice of external advisors or consultants who
  162  have relevant experience. In addition, an unsolicited proposal
  163  must be accompanied by the following information, unless waived
  164  by the board or the direct-support organization:
  165         1.A description of the qualifying project, including the
  166  conceptual design of the facilities or a conceptual plan for the
  167  provision of services, and a schedule for the initiation and
  168  completion of the qualifying project.
  169         2.If applicable, a description of the method by which the
  170  private entity proposes to secure the necessary property
  171  interests that are required for the qualifying project.
  172         3.A description of the private entity’s general plans for
  173  financing the qualifying project, including the sources of the
  174  private entity’s funds and the identity of a dedicated revenue
  175  source or proposed debt or equity investment on behalf of the
  176  private entity.
  177         4.The name and address of a person who may be contacted
  178  for additional information concerning the proposal.
  179         5.The proposed user fees, lease payments, or other service
  180  payments over the term of a comprehensive agreement, and the
  181  methodology for and circumstances that would allow changes to
  182  the user fees, lease payments, and other service payments over
  183  time.
  184         6.Additional material or information that the board or
  185  direct-support organization reasonably requests.
  186         (d) After the public notification period has expired in the
  187  case of an unsolicited proposal or upon receipt of all proposals
  188  if using the traditional process for competitive procurement
  189  authorized under Board of Governors’ and university regulations,
  190  the board or direct-support organization shall rank the
  191  proposals received in order of preference. The board or direct
  192  support organization may then begin negotiations for a
  193  comprehensive agreement with the highest-ranked firm. If the
  194  board or direct-support organization is not satisfied with the
  195  results of the negotiations, the board or direct-support
  196  organization may terminate negotiations with the proposer and
  197  negotiate with the second-ranked or subsequent-ranked firms, in
  198  the order consistent with this procedure. If only one proposal
  199  is received, the board or direct-support organization may
  200  negotiate in good faith, and if the board or direct-support
  201  organization is not satisfied with the results of the
  202  negotiations, the board or direct-support organization may
  203  terminate negotiations with the proposer. Notwithstanding this
  204  paragraph, the board or direct-support organization may reject
  205  all proposals at any point in the process.
  206         (4) PROJECT FEASIBILITY.-Prior to entering into a
  207  comprehensive agreement, a board or direct-support organization
  208  shall conduct an analysis of the feasibility and desirability of
  209  the project or the activities proposed to be funded under the
  210  comprehensive agreement, and shall develop sufficient
  211  information to determine:
  212         (a) That the agreement is in the best interest of the
  213  public, the state, and the state university;
  214         (b) The conformity of any project with the master plan of
  215  the state university and a determination that the project or
  216  activities are essential to the state university’s core mission;
  217         (c) The need for the project or the activities proposed to
  218  be funded under the agreement based on quantitative metrics;
  219         (d)The amount and source of funds to be used to fully fund
  220  the capital, operation, maintenance, or other expenses under the
  221  agreement;
  222         (e) The cost of any investment to be made under the
  223  agreement by the board or a direct-support organization;
  224         (f) The economic and financial feasibility of any project
  225  or activities proposed to be funded under the agreement;
  226         (g) That the projected demand for use of any project is
  227  adequate in relation to the cost of the project;
  228         (h) The expected return on investment or internal rate of
  229  return for a revenue-generating project or another appropriate
  230  quantitative measure for a non-revenue-generating project;
  231         (i) That the cost of any project is reasonable in relation
  232  to similar facilities;
  233         (j) The financial, operational, or technological risk
  234  associated with any project;
  235         (k) That any increase in the cost of financing the project
  236  over the cost of financing the project under s. 1010.62 will be
  237  offset by quantifiable savings in operational costs or other
  238  activities that will be performed by the private entity and
  239  specifies the anticipated amount of such savings;
  240         (l) Any impact to the state’s finances of undertaking the
  241  project or the activities proposed to be funded under the
  242  agreement by the state university or direct-support
  243  organization;
  244         (m) The impact of the agreement on similar activities of
  245  the state university or direct-support organization that will
  246  not be placed under the agreement;
  247         (o) The anticipated use of money to be received by the
  248  state university or direct-support organization under the
  249  agreement;
  250         (p) The relationship between the source of any funds
  251  committed by the board or direct-support organization pursuant
  252  to subsection (8) and the project or activities proposed to be
  253  funded under the agreement;
  254         (q) The private entity has the available sources of funding
  255  or other financial resources that are necessary to carry out the
  256  agreement;
  257         (r) That the staff of the private entity have sufficient
  258  experience and qualifications to perform the managerial,
  259  organizational, and technical activities proposed to be funded
  260  under the agreement;
  261         (s) That no director, officer, partner, owner, or other
  262  individual with direct and significant control over the policy
  263  of the private entity has been convicted of corruption or fraud;
  264  and
  265         (t) Any other factors determined to be appropriate by the
  266  board, direct-support organization or the Board of Governors.
  267         (5) APPROVAL OF COMPREHENSIVE AGREEMENTS.-All comprehensive
  268  agreements are contingent upon approval by the Board of
  269  Governors. A comprehensive agreement between a direct-support
  270  organization and a private entity must be approved by the
  271  university board prior to submission to the Board of Governors
  272  for approval.
  273         (a)In addition to Board of Governors’ approval, approval
  274  of the Governor and Cabinet is required for any comprehensive
  275  agreement that:
  276         1. Has a term of over ten years, including any renewals or
  277  extensions;
  278         2. Provides for an up-front payment from the private entity
  279  to the board or direct-support organization which constitutes
  280  more than 10 percent of the total compensation anticipated to be
  281  paid by the private entity to the board or direct-support
  282  organization over the initial term or any renewal term or
  283  extension of the agreement;
  284         3. Provides for the creation of debt of the board or a
  285  direct-support organization as permitted pursuant to s. 1010.62;
  286         4. Pledges or uses revenues permitted under s. 1010.62 to
  287  secure or pay amounts due under the agreement; or
  288         5. Is implemented pursuant to paragraph (b).
  289         (b) Before a board or direct-support organization enters
  290  into an agreement under which the board or a direct-support
  291  organization is expected to receive over $10 million, the state
  292  university must provide a summary of the proposal to the Board
  293  of Governors, the Governor, the members of the Cabinet, the
  294  President of the Senate, and the Speaker of the House of
  295  Representatives. The summary must include a description of the
  296  anticipated use of money to be received by the board or direct
  297  support organization under the public-private partnership
  298  agreement and any other information requested by a recipient of
  299  the summary. If the President of the Senate or the Speaker of
  300  the House of Representatives objects to the proposed agreement
  301  in writing within 14 days after receipt of the summary, the
  302  board or direct-support organization may not proceed with the
  303  agreement unless all objections are resolved.
  304         (c)The Board of Governors shall establish a process for
  305  the evaluation and approval of comprehensive agreements by a
  306  university board, the Board of Governors or other state
  307  officers, and requirements for additional information to be
  308  provided by a state university in obtaining approval for a
  309  comprehensive agreement.
  310         (6) COMPREHENSIVE AGREEMENT.—
  311         (a) Before developing or operating the qualifying project,
  312  the private entity must enter into a comprehensive agreement
  313  with the board or direct-support organization. The comprehensive
  314  agreement must provide for:
  315         1. Delivery of performance and payment bonds, letters of
  316  credit, or other security acceptable to the board or direct
  317  support organization in connection with the development or
  318  operation of the qualifying project in the form and amount
  319  satisfactory to the board or direct-support organization. For
  320  the components of the qualifying project which involve
  321  construction, the form and amount of the bonds must comply with
  322  s. 255.05 and s. 1013.47.
  323         2. Review of the design for the qualifying project by the
  324  board or direct-support organization and, if the design conforms
  325  to acceptable standards, the approval of the board or the
  326  direct-support organization. This subparagraph does not require
  327  the private entity to complete the design of the qualifying
  328  project before the execution of the comprehensive agreement.
  329         3. Inspection of the qualifying project by the board or
  330  direct-support organization to ensure that the private entity’s
  331  activities are acceptable to the board or direct-support
  332  organization in accordance with the comprehensive agreement.
  333         4. Maintenance of a policy of public liability insurance, a
  334  copy of which must be filed with the board or direct-support
  335  organization and accompanied by proofs of coverage, or self
  336  insurance, each in the form and amount satisfactory to the board
  337  or direct-support organization and reasonably sufficient to
  338  ensure coverage of tort liability to the public and employees
  339  and to enable the continued operation of the qualifying project.
  340         5. Monitoring by the board or direct-support organization
  341  of the maintenance practices to be performed by the private
  342  entity to ensure that the qualifying project is properly
  343  maintained.
  344         6. Periodic filing by the private entity of the appropriate
  345  financial statements that pertain to the qualifying project.
  346         7. Procedures that govern the rights and responsibilities
  347  of the board or direct-support organization and the private
  348  entity in the course of the construction and operation of the
  349  qualifying project and in the event of the termination of the
  350  comprehensive agreement or a material default by the private
  351  entity. The procedures must include conditions that govern the
  352  assumption of the duties and responsibilities of the private
  353  entity by an entity that funded, in whole or part, the
  354  qualifying project or by the board or direct-support
  355  organization, and must provide for the transfer or purchase of
  356  property or other interests of the private entity by the board
  357  or direct-support organization.
  358         8. In negotiating user fees, the fees must be the same for
  359  persons using the facility under like conditions and must not
  360  materially discourage use of the qualifying project. The
  361  execution of the comprehensive agreement or a subsequent
  362  amendment is conclusive evidence that the fees, lease payments,
  363  or service payments provided for in the comprehensive agreement
  364  comply with this section. Fees or lease payments established in
  365  the comprehensive agreement as a source of revenue may be in
  366  addition to, or in lieu of, service payments.
  367         9. Duties of the private entity, including the terms and
  368  conditions that the board or direct-support organization
  369  determines serve the public purpose of this section.
  370         10. A limitation on the term of the comprehensive agreement
  371  not to exceed 30 years, inclusive of all renewal terms.
  372         11. A provision under which each entity agrees to provide
  373  notice of default and cure rights for the benefit of the other
  374  entity, including, but not limited to, a provision regarding
  375  unavoidable delays.
  376         12. A provision that terminates the authority and duties of
  377  the private entity under this section and dedicates the
  378  qualifying project to the board or direct-support organization.
  379         (b) A comprehensive agreement may not obligate the full
  380  faith and credit of the state, a state university, or the Board
  381  of Governors, but shall only be secured by the revenues of the
  382  board or direct-support organization pledged for such purpose.
  383  Revenues of a board or direct-support organization may not be
  384  pledged to secure, or be used to make payments on or in relation
  385  to, a comprehensive agreement, nor shall any debt of a board or
  386  direct-support organization be created, except as provided in s.
  387  1010.62, and only the revenues authorized to be used pursuant to
  388  s. 1010.62 may be used to secure or pay obligations under or
  389  related to such agreement. In addition, a comprehensive
  390  agreement may not contain any provisions limiting the ability of
  391  the state university or direct-support organization to perform
  392  its functions, including any limitation on the ability to
  393  perform responsibilities and duties relating to debt issued for,
  394  by or on behalf of the state university or direct-support
  395  organization.
  396         (7) FINANCING.—
  397         (a) A private entity may enter into a private-source
  398  financing agreement between financing sources and the private
  399  entity. A financing agreement must be paid in full at the
  400  applicable closing that transfers ownership or operation of the
  401  facility to the board or direct-support organization at the
  402  conclusion of the term of the comprehensive agreement. In the
  403  event of a material default by the private entity, the board or
  404  the direct-support organization will assume ownership or
  405  operation of the qualifying project pursuant to the terms of the
  406  comprehensive agreement.
  407         (b) The board or direct-support organization may use
  408  innovative finance techniques associated with a public-private
  409  partnership under this section, including, but not limited to,
  410  federal loans as provided in Titles 23 and 49 C.F.R., commercial
  411  bank loans, and hedges against inflation from commercial banks
  412  or other private sources. In addition, the board or direct
  413  support organization may provide its own capital or operating
  414  budget to support a qualifying project. The budget may be from
  415  any legally permissible funding sources of the board or direct
  416  support organization, including the proceeds of debt issuances.
  417  A financing agreement may not subject the board’s or direct
  418  support organization’s facility to liens in violation of s.
  419  11.066(5).
  420         (8) RESPONSIBILITIES OF THE PRIVATE ENTITY.—
  421         (a) The private entity shall:
  422         1. Develop or operate the qualifying project in a manner
  423  that is acceptable to the board or direct-support organization
  424  in accordance with the provisions of the comprehensive
  425  agreement.
  426         2. Maintain, or provide by contract for the maintenance or
  427  improvement of, the qualifying project if required by the
  428  comprehensive agreement.
  429         3. Cooperate with the board or direct-support organization
  430  in making best efforts to establish interconnection between the
  431  qualifying project and any other facility or infrastructure as
  432  requested by the board or direct-support organization in
  433  accordance with the provisions of the comprehensive agreement.
  434         4. Comply with the comprehensive agreement and a lease or
  435  service contract.
  436         (b) Each private facility that is constructed pursuant to
  437  this section must comply with the requirements of federal,
  438  state, and local laws; state, regional, and local comprehensive
  439  plans; the regulations, procedures, and standards for facilities
  440  of the board or direct-support organization, as applicable; and
  441  such other conditions that the board or direct-support
  442  organization determines to be in the public’s best interest and
  443  that are included in the comprehensive agreement.
  444         (c) The board or direct-support organization may provide
  445  services to the private entity. An agreement for maintenance and
  446  other services entered into pursuant to this section must
  447  provide for full reimbursement for services rendered for
  448  qualifying projects.
  449         (d) A private entity of a qualifying project may provide
  450  additional services for the qualifying project to the public or
  451  to other private entities if the provision of additional
  452  services does not impair the private entity’s ability to meet
  453  its commitments to the board or direct-support organization
  454  pursuant to the comprehensive agreement and the services do not
  455  differ in kind from those provided under the agreement.
  456         (9) EXPIRATION OR TERMINATION OF AGREEMENTS.—Upon the
  457  expiration or termination of a comprehensive agreement, the
  458  board or direct-support organization may use revenues from the
  459  qualifying project to pay current operation and maintenance
  460  costs of the qualifying project. Revenues in excess of the costs
  461  for operation and maintenance costs may be paid to the investors
  462  and lenders to satisfy payment obligations under their
  463  respective agreements if allowed under the provisions of the
  464  comprehensive agreement. A board or direct-support organization
  465  may terminate with cause and without prejudice a comprehensive
  466  agreement and may exercise other rights or remedies that may be
  467  available to it in accordance with the provisions of the
  468  comprehensive agreement. The assumption of the development or
  469  operation of the qualifying project does not obligate the board
  470  or direct-support organization to pay an obligation of the
  471  private entity from sources other than revenues from the
  472  qualifying project.
  473         (10) SOLE AUTHORITY.-This section shall provide the sole
  474  authority for a state university or direct-support organization
  475  to enter into a comprehensive agreement.
  476         (11) SOVEREIGN IMMUNITY.-A comprehensive agreement may not
  477  be construed as waiving the sovereign immunity of the state or
  478  as a grant of sovereign immunity to a private entity.
  479         (12) ANNUAL REPORT.-For any comprehensive agreement
  480  executed by a state university or direct-support organization
  481  after the effective date of this act, the university shall
  482  prepare an annual report to the Board of Governors which updates
  483  information provided for the initial approval of the public
  484  private partnership and provides any other information required
  485  by the Board of Governors. The format and specific timeframe for
  486  reporting shall be as specified by the Board of Governors.
  487  However, the initial annual report shall be filed no later than
  488  November 30th after the public-private partnership has been in
  489  effect for one full fiscal year.
  490         (13) RULES.-The Board of Governors may adopt such rules as
  491  may be necessary for carrying out all of the requirements of
  492  this section and may do all things necessary to carry out the
  493  powers granted under this section. The Board of Governors may
  494  establish additional restrictions relating to public-private
  495  partnerships but may not take any action which would reduce the
  496  requirements of this section.
  497         Section 2. This act shall take effect July 1, 2014.
  498  
  499  ================= T I T L E  A M E N D M E N T ================
  500  And the title is amended as follows:
  501         Delete everything before the enacting clause
  502  and insert:
  503                        A bill to be entitled                      
  504         An act relating to public private partnerships;
  505         creating s. 1013.505, F.S.; providing definitions;
  506         providing for partnerships between state universities
  507         or direct-support organizations and private entities;
  508         providing for approval of the Board of Governors and
  509         the Governor and Cabinet for certain public-private
  510         partnership agreements; providing for a summary of
  511         certain proposed projects; providing for an analysis
  512         of the feasibility and desirability of the proposed
  513         project; providing requirements of a private entity
  514         and the Board of Governors; providing terms of a
  515         public-private partnership agreement; providing for an
  516         annual report; providing authority to the Board of
  517         Governors to adopt certain rules and policies;
  518         providing an effective date.