P3 projects offer lenders an opportunity to extend low-risk financing either to a development entity i.e., contractor. In the typical P3 project, there will be a funding agreement between the County and NCGPA pursuant to which the County will make periodic payments to NCGPA. These payments will allow NCGPA to make payments to the contractor or to a lender, if a lender extends financing directly to NCGPA.
The funding agreement will be an “intergovernmental agreement” under the County Administrative Code, which means County Council will be obligated to make annual appropriations to fund the payments to NCGPA. A lender can cooperate with a contractor to develop the financial component of a proposal submitted by the contractor to perform the project work. Alternatively, if NCGPA issues an RFP to lenders for financing for the project, lenders will have the opportunity to submit proposals directly to NCGPA. Lenders are advised that neither the County nor NCGPA will issue bonds to finance a project.