F-M metro diversion board picks partners to build $1 billion channel
The long and winding road toward completing the $2.75 billion flood-control project to protect the Fargo-Moorhead metro area took an important step with the selection of the private partners to build the $1.14 billion diversion channel.
FARGO — The long quest to provide lasting flood protection for the Fargo-Moorhead metro area took another important step with the selection of a consortium of companies that will design and build a diversion channel.
The 30-mile channel that will skirt the metro area west of West Fargo will be designed and built by a Miami-based partnership of major companies called the Red River Alliance. The Metro Flood Diversion Authority Board selected the group on Friday, June 18.
The Red River Valley Alliance was deemed to have the lowest bid — $1.14 billion — that met specifications. The bid was very close to the Diversion Authority's estimate.
Ripples of applause filled the chambers of Fargo City Hall when the choice was made by a unanimous vote in a meeting that lasted less than 10 minutes.
"This is incredible," said Moorhead Mayor Shelly Carlson, chairwoman of the Diversion Authority board, noting the magnitude of the step in the long effort to move the project ahead after it was stalled for years by legal challenges.
"This is the epitome of partnerships," said Sen. John Hoeven, R-N.D. "This is a first in the nation," a reference to the first time a public-private partnership has been used for a federal flood-control project.
"This is historic what's happening here today," said Gov. Doug Burgum, who noted that the project will protect $20 billion to $25 billion in property, a quarter of North Dakota's hospital beds and almost 60 elementary and secondary schools.
"This really is a statewide project," given its significance to the entire state, Burgum said.
Fargo Mayor Tim Mahoney said Friday's milestone means the city now is assured a brighter future and will see an end to the flood uncertainty that has shadowed residents for decades.
"It means a better and safer place to live and work and explore," Mahoney said.
Chad Peterson, chairman of the Cass County Commission, said the years of struggle and opposition in the end strengthened the project. "Iron sharpens iron," he said.
The Red River Valley Alliance's members are Corporacion Acciona Infraestruras S.L., Shikun & Binui Ltd. and North American Construction Group, Ltd. Acciona is based in Spain but has significant experience in construction management in North America.
Preparations for the channel — possibly the most iconic feature of the massive flood-control project — will be made in the months ahead and officials expect construction for that phase of the project to begin in the spring.
Work already is under way for two of three gated control structures that will be embedded within a 22-mile earthen embankment that will snake south of Fargo. The control structures and embankment will form an elaborate dam to hold back water upstream temporarily to regulate releases downstream along the Red River.
Next year work also will begin on the third and largest control structure to regulate flows on the Red River, and work will continue to raise a stretch of Interstate 29 south of the metro area to elevate it above the project’s water impoundment area.
Construction of the $2.75 billion diversion project will fuel a massive construction boom that could over time employ up to 7,700 workers — an army of builders for what is considered the largest public works project in the area since construction of the interstate highways and Garrison Dam.
Naming the consortium of private companies that will build the diversion channel brings together the parties in what is called a unique public-private partnership to build the diversion, the first such arrangement in the nation for a flood-control project, according to officials.
The public partner is the U.S. Army Corps of Engineers, which is designing and building the embankment and the three control structures.
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Also Friday, officials signed paperwork on a low-interest, guaranteed federal loan package of $569 million administered by the Environmental Protection Agency that will save $438 million in borrowing costs for the project.
Compared to traditional construction delivery, the public-private partnership will save $330 million and 10 years of time, Hoeven said.
The selection of the private partner for the project is a milestone in a twisting procedural course that mimics the meandering Red River. The diversion was prompted by the record 2009 flood, which came close to inundating Fargo and Moorhead.
Local and state officials on both sides of the river quickly decided to cooperate on a massive flood-control project, but the proposal encountered stiff resistance from upstream communities that would be impacted by the water staging area when the diversion operates, which engineers estimate will be once every 20 years, on average.
Minnesota denied a permit for the diversion’s first design, objecting to impacts in that state exceeding the project’s benefits, forcing a compromise that led to a redesign that won a permit from Minnesota.
But upstream opponents sued in federal court and challenged the Minnesota permit, resulting in a settlement agreement last fall that put to an end all of the opposition to the project. A key provision of the settlement agreement was the establishment of a $75 million economic relief fund to address upstream impacts.