The Financial Management Commission3 recommended that government and Supported Infrastructure Organizations (school boards, health authorities and post-secondary institution boards, known as SIOs) should be allowed to enter into alternative funding arrangements for capital projects, under specific conditions and with appropriate guidelines. The Government of Alberta accepted this recommendation.
On February 11, 2003 Cabinet established a process for approving capital projects and alternative financing of capital projects, which includes public-private partnerships. Previously all capital spending was on a pay-as-you-go basis. Under the new capital plan, alternative funding may be used. This could include, for example, P3s, capital leases, capital bonds and other borrowing.
Alternative financing may be used both for government-owned capital projects and for government-supported projects owned by SIOs (school boards, health authorities and post-secondary institutions).
An Advisory Committee on Alternative Capital Financing (ACACF) was announced on May 21, 2003. The Committee's role is to:
• Provide recommendations to Treasury Board regarding guidelines for alternative funding of capital projects.
• Evaluate capital projects and supporting business cases and make recommendations to Treasury Board.
• Provide support to Ministries on the advantages and limitations of alternative funding and the relationship to the delivery of the government's multi-year capital plan.
• Maintain an ongoing overview of public policy developments both nationally and internationally concerning the various funding approaches supporting public infrastructure development.
The Committee consists of private sector individuals with expertise in areas such as finance and investment management, real estate development and commercial law.
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3 "Moving from Good to Great - Enhancing Alberta's Fiscal Framework". Alberta government, July 8, 2002