Five Questions With: John G. Picerne

"Rhode Island should consider capitalizing on its annualized revenue sources through a public-private partnership that will allow them to put a sustainable solution in place."

John G. Picerne is founder and CEO of Corvias Group, a privately owned company with three divisions that focus on addressing large-scale challenges in military housing, student housing and stormwater and energy infrastructure using a community-based public-private partnership approach. According to the company, it has a proven track record of providing “sustainable, long-term performance” and cost savings to communities across the United States. The firm cites recent successes including the elimination of millions of dollars in backlog of housing maintenance and operations at 13 Department of Defense military bases nationwide. The company is also focused on addressing quality campus housing for colleges and universities along the eastern seaboard, and assisting municipalities, such as Prince George’s County, Maryland with storm water regulatory compliance challenges.
When Picerne founded Corvias in 1998, he also established a private charitable foundation, Corvias Foundation, to support the spouses and children of active-duty service members in their pursuit of higher education. To date, the Foundation has awarded more than $5 million in scholarships.
Picerne has been a real estate professional for more than 20 years.

PBN: With your extensive experience in real estate, starting with your family business and then your own companies, Corvias Military Living, Corvias Campus Living and Corvias Solutions, which focuses on public infrastructure, what do you see as the most pressing issue that requires public or private investment?
PICERNE:
At Corvias we are concerned about the challenges Rhode Island and other states face with aging and neglected infrastructure. Our roadways, waterways and bridges are essential to economic development and are required to move people, goods or services in an efficient manner.
State and local governments have been forced to delay maintenance activities during this protracted economic downturn and this underinvestment has created safety and health concerns. Our educational institutions, for instance, are enduring unsafe, unhealthy and inadequate conditions that undermine the missions of these institutions. Public-private partnerships, or P3s, are effective ways to fund, implement and manage these kinds of large-scale infrastructure and facilities projects.
Much of the discussions we are having with state, county and local governments are about how to fund these important projects at a time when all available public sector financing options are not sufficient to meet the need. There is a genuine desire to address these challenges and officials are looking to find flexible funding options like those offered by public-private partnerships.

PBN: The nation has been in the economic doldrums for several years and while the economy is reportedly picking up a bit, it’s still sluggish. Where do you suggest investments should come from to replace deficient infrastructure and facilities?
PICERNE:
I believe it should be a matching of public and private investment to address some of the basic infrastructure areas in need of improvement. Public sector educational institutions and governments are facing a shortage in traditional funding sources and have inadequate operating budgets to maintain these projects for the lifespan of the asset. The best, and likely only, way to solve the state’s deficient infrastructure challenge is with the investment of federal and state funds matched with private funds. The money and funding sources already exist, but they are not being used properly. I would like to see the federal government supporting state governments by allowing them to use existing funds more effectively to enable the private sector to leverage these funding sources to address crumbling elementary schools, dilapidated college dorms and to meet storm water regulatory requirements.
For instance, broadening the use of the Clean Water Act State Revolving Funds by Congress could allow the funds to be invested in a public-private partnership, which in turn, could be converted into what would amount to a $3 trillion investment.

PBN: A national report released in July found more than two-thirds of U.S. roadways in need of repair. Rhode Island and Connecticut are the worst, with 41 percent of their roads considered to be in poor condition, compared with a national average of 14 percent. Where do you suggest Rhode Island should begin in confronting that overwhelming challenge?
PICERNE:
Rhode Island should consider capitalizing on its annualized revenue sources through a public-private partnership that will allow them to put a sustainable solution in place. By supplementing existing funds with private investment, they could solve most, if not all, infrastructure challenges.
This is the approach that the DoD utilized to address the backlog in military housing. In the dawn of military housing privatization, three quarters of the U.S. Army’s military housing was in poor condition. Traditional solutions would have required 20 years to clear the maintenance backlog at a cost of more than $7 billion. The Army successfully managed this backlog at a much lower cost and half the time by creating public-private partnerships that allowed private partners like Corvias Military Living to leverage the existing revenue to raise private money that addressed the immediate shortage while creating a sustainable 50-year solution.

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PBN: Rhode Island continues to lag behind much of the U.S., and its New England neighbors, in economic recovery. Many businesses are located in older structures that need repair or renovation. Some businesses considering expansion are hampered by flood insurance issues. Based on your experience, what insights or guidance can you offer Rhode Island businesses in need of structural improvements?
PICERNE:
This is a complex problem that requires a collaborative community approach, similar to what Corvias Solutions is doing in Prince George’s County, Maryland. Urban flooding is driven by several factors, including inadequate storm water management, extensive impervious surfaces which prevent absorption, and inadequate risk mitigation via flood insurance. The obstacles surrounding flood insurance are best addressed at the root of the issue. The reality is that when heavy rains come, the state’s infrastructure is not capable of handling storms adequately. We could also support one another if the state created a flood insurance pool (similar to workers’ compensation funds) for businesses. As a business owner, I would welcome more dialogue about how the state can better support local businesses with initiatives including financial incentives for a business to renovate or remodel an old building, or streamlining the approval process for anyone seeking to fix up a facility.

PBN: You’re a native Rhode Islander who has launched several successful businesses, defying a lot of the continuing concerns about the high cost of doing business in the state and other complaints of business unfriendliness. How have you managed to override the common challenges many business face in the Ocean State?
PICERNE:
Corvias has the good fortune of being a national player working on a national platform. We maintain our corporate offices in Rhode Island because it is a great place to live with an intelligent, entrepreneurial workforce. I was lucky to have been born here and I appreciate all of the great things that come with being a Rhode Island resident.
These are important elements of commerce that Rhode Island needs to think about to maintain and attract businesses. We need to find better incentives for businesses to stay and grow here. I am starting to see that Rhode Island is becoming more open to working with businesses to help them succeed.
We have to create an environment by taking a cooperative approach to supporting economic growth. The state is primed for investment as well as development. The benefits of public-private partnerships are being realized nationwide. Rhode Island is fertile ground for public and private investment to take place to reshape the state. Our hope and expectation is that Corvias will be a part of that.

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