To the editor:
The Saint Paul District U.S. Army Corps of Engineers has recently released a document touting the value of the Alternative Delivery plan, called the P3, for funding the FM Diversion.
The P3 funding is a private public partnership to fund projects that were not funded in the Water Resource Reform and Development Act of 2014.
Among the reasons stated in this document for using the P3 funding method are the following:
“It will save the federal government $400 million.”
This is because Diversion Channel Non-Federal Sponsor (the Northern Reach) of the project is a local project. It is clear the federal government is not going to fund the Northern Diversion Channel. The only ones who can make up that lost federal share of $400 million are the taxpayers in North Dakota.
The state of North Dakota will only put in so many dollars. Fargo/West Fargo will be paying the extra federal share. Of course Moorhead will not be paying for Fargo's growth.
“The P3 relocates the federal risk.”
A private contractor who is to build the project is to take the risk. What is the risk that the Corp (federal government) does not want to take? Is it a financial risk? If that risk is too big for the federal government, who is this private contractor or group of contractors who is big enough to take that risk? If it is a risk of failure of the high-hazard dam or any of the miles of levees, it is a condemnation of the whole project.
The Diversion Channel Non Federal Sponsor (Northern Reach) is to be built by a P3 contractor and the Southern Embankment (Southern Reach) is to be built by the Corps, as they, the Corps, are more qualified to do it. Which one, the Diversion Channel or the Southern Embankment (which is just a long high-hazard dam), has more financial risk or a higher risk of failure? If the project is sound, there should be no shuffling of risk to others. The private contractor when faced with a failure of finances or project failure can file bankruptcy leaving North Dakota holding the bag.
“The P3 will reduce exposure and future cost to FEMA.”
This may very well be true, without flood insurance FEMA will not pay flood loss claims.
“The project is shovel ready.”
It is not shovel ready; all design work is not completed and contracts are not ready to be signed.
“Local funding is secured.”
The voters and West Fargo rejected the assessment district as a backup to the funding means chosen by the Diversion Authority. Also the assessment district is still in court. With talk of a new sales tax it is presumptuous to state that local funding is secured.
The Buffalo Red River Water Resource District has refused to approve the FM Diversion budget for 2015 and has not approved the 2016 budget.
The Minnesota contribution to the project is in grave doubt so that $100 million will be made up by Fargo taxpayers, as North Dakota will not be paying Minnesota's share of the project. Minnesota has already spent millions on flood protection for Moorhead.
If the P3 funding is authorized, Keith Berndt, Cass County administrator and a member of many committees of the Diversion Authority, is right -- Fargo taxpayers will pay for this project.
Kindred ND 58051
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