Group working to break logjam on North Dakota, Minnesota P3 flood project

Register now

DALLAS -- A special task force is exploring alternative plans in an attempt to break the logjam over a stalled $2 billion public private partnership billed as the solution to flooding in the metro areas of Fargo, N.D., and Moorhead, Minn.

The 16 member task force task force was created by North Dakota Gov. Doug Burgum and Minnesota Gov. Mark Dayton in an effort to end the impasse. Its work follows a federal injunction on Sept. 7 temporarily blocking construction until the Army Corps obtain the necessary permits from the Minnesota Department of Natural Resources.

Alternatives presented at a meeting on Monday include constructing a big dam on the Red River with no diversion, a diversion through Minnesota, a combination of water storage and a diversion with no dam, and the diversion project with a dam moved farther north.

Approximately $900 million of project costs would be financed through the issuance of sales tax revenue bond issued by the Fargo-Moorhead Diversion Authority -- an entity that was created by an inter-governmental agreement among five member entities: the city of Moorhead, Clay County, Minn., Cass County, N.D., Fargo, and the Cass County Joint Water Resources District.

The federal government has committed to $450 million in construction appropriations. The project has received $20 million in federal funding through the Corps work plan for fiscal year 2017. The project previously received a federal “new start” status and $5 million in federal appropriations for construction in the fiscal year 2016 Corps work plan. The fiscal year 2016 funding is being used for construction of the diversion inlet and control structure south of Horace. Some are worried that the delays will drive up project costs.

The task force has ruled out any project with a diversion channel running through Minnesota or any that relied primarily on distributed storage, a system of hundreds of temporary water storage ponds located on farms around the region. The idea was earlier presented as a possible resolution to the logjam.

"This is a challenging, complex solution we're looking for because there's a number of constraints on the project. We've identified a number of those in the working group," North Dakota Gov. Doug Burgum said after the meeting. "We said we want to maintain federal authorization. We want to achieve (Federal Emergency Management Agency) accreditation so we don't have to buy flood insurance. We want to minimize upstream and downstream impact. And we want to achieve a Minnesota permit. Often those design constraints can be in conflict with one another."

The DNR denied a permit to build a dam across the Red River in October, arguing that emergency measures like those used during a devastating 2009 flood and new dikes should be enough. The Corps however, acting on congressional authorization, began construction on the diversion inlet structure near Horace, ND in April 2017.

Monday’s gathering marked the third meeting of the group. At its second meeting in early November, the group agreed on a 100 year base line for certified flood protection for Fargo-Moorhead that FEMA says is acceptable and would not require property owners to purchase flood insurance. Burgum said that financially it amounts to a giant tax break for all in the region if the project achieves the 100 year base line for certified flood protection. The group also agreed to put a federal lawsuit against the project on hold while the group works on solutions.

Burgum and Dayton have set a Dec. 15 deadline for the task force to come up with recommendations to resolve the differences.

The project marks the Corps' first use of a public-private partnership, which backers say will save $400 million and reduce the project delivery timeline by more than 50% compared with traditional approaches.

The project received authorization from Congress in 2014 and Congress provided funding to construct the project in 2016. But in October 2016, Minnesota’s DNR denied a permit to build a dam across the Red River, arguing that emergency measures like those used during the 2009 flood and new dikes should be enough.

Congressional authorization for the new project allows for modifications but to remain within that federal authorization, there has to be a diversion channel in North Dakota, a southern embankment and minimal downstream impacts. Corps project manager Aaron Snyder said that allows for some flexibility to modify alignments, modify operations and to continue to find ways to minimize impact to people in the environment.

The project has three main parts: in-town levee projects; a southern embankment; and a bond-financed, 36-mile-long, 1,500-foot-wide diversion channel with 32,500 acres of upstream staging, including aqueducts, river inlets and bridges, and a dam. The southern embankment regulates water to prevent flooding of the metro area during a significant flood.

The Diversion Authority had been set to receive final bid proposals from competing developers for the public-private partnership on December 15. The project was scheduled to select the developer in the first quarter of 2018.

The four consortiums eligible to bid are Lake Agassiz Partners, Red River Valley Partners, Red River Valley Alliance and Red River Partners, all made up of national and international firms.

For reprint and licensing requests for this article, click here.
Public-private partnership Revenue bonds Infrastructure Lawsuits Fargo-Moorhead Diversion Authority North Dakota Minnesota