The Financial Management Commission1 recommended that GOA and Supported Infrastructure Organizations (SIOs) should be allowed to enter into alternative funding arrangements for capital projects, under specific conditions and with appropriate guidelines in place. The GOA accepted this recommendation and amended the Fiscal Responsibility Act to allow alternative financing for government-owned capital projects. Previously all capital spending was funded on a pay-as-you-go basis. The Fiscal Responsibility Act was further amended in 2008 to clarify that alternative financing may be used both for GOA owned capital projects and for GOA supported projects owned by school boards, Alberta Health Services and post-secondary institutions.
On February 11, 2003 Cabinet established a process for approving capital projects and alternative financing of capital projects, including P3s (see Appendix A.1 for the Approval Process). Alternative financing can take different forms and could include P3s, capital leases, capital bonds and other borrowing. Under the process approved by Cabinet, an Advisory Committee on Alternative Capital Financing (the "Committee") was established and announced on May 21, 2003. The Committee's primary role is to provide recommendations to Treasury Board Committee on proposals for alternative financing for capital projects. (See Appendix C.5 for the Committee's Terms of Reference.) The Committee consists of private sector individuals with expertise in areas such as finance and investment management, real estate development and commercial law.
The Alternative Capital Financing Office (ACFO) was established in June 2007. The role of ACFO is to:
■ Collaborate with stakeholders and other ministries and jurisdictions to develop opportunities to pursue alternative financing options such as P3s and implement where cost effective and feasible; and
■ Lead the development of P3 guidelines to provide consistent standards, policies and accountabilities across capital projects and ministries.
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1 Recommendation 8 of Moving from Good to Great - Enhancing Alberta s Fiscal Framework . Alberta Financial Management Commission, July 8, 2002, http://www.finance.alberta.ca/publications/other/2002 0708 fmc final report.pdf