Funding Sources for Construction, Operations & Maintenance
The MFDA intends to finance, construct, operate, and maintain the comprehensive project in coordination with the U.S. Army Corps of Engineers. In accordance with the Joint Powers Agreement, the MFDA will assist in the overall management of the comprehensive project, which includes property acquisition, planning, design, and development. The MFDA will provide financing by coordinating the issuance of debt obligations by member entities or to provide availability payments and/or milestone payments by a member entity. The MFDA also will provide for the FM Area Diversion’s operation and maintenance, including hiring, retaining, and terminating private contractors or developers for the work.
Funding for building the FM Area Diversion comes from city, county, state, and federal jurisdictions:
City of Fargo, North Dakota: Voter-approved sales taxes on retail sales (City 3-21 Sales Tax of 0.5% and City 3-22 Sales Tax of 0.5% as well as 0.25% of City 3-20 Sales Tax)
City of Moorhead, Minnesota: The City of Moorhead will request up to $1 million (in 2015 dollars, as adjusted for inflation) from the State of Minnesota through appropriations, grants, or cost share allocations
Cass County, North Dakota: A 0.5% sales and use tax within the corporate limits of Cass County (County 2010-2 Sales Tax) will contribute at least 94% of what’s collected
Clay County, Minnesota: Clay County will actively request State of Minnesota appropriations, grants, or cost share allocations
Cass County Joint Water Resource District (CCJWRD): CCJWRD created FM Flood Risk Management District No. 1, with the capacity to levy special assessments (plus applicable interest) of $725 million with an additional 20% allowed by the North Dakota Century Code
State of North Dakota: $435 million bonding package as well as $415 million in State Water Commission funds
State of Minnesota: $9.8 million appropriated to date from Minnesota DNR Flood Mitigation funds
Federal Government: $569 million Water Infrastructure Finance and Innovation Act (WIFIA) loan from the U.S. Environmental Protection Agency to the Metro Flood Diversion Authority
Federal Government: $437 million from the Infrastructure Investment and Jobs Act along with $313 million previously allocated to the U.S. Corps of Engineers
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Funding for long-term operations and maintenance costs:
The MFDA, through the Master Indenture of Trust, established an ongoing O&M Funding Program. It will be funded by excess sales and use tax revenues, an annual maintenance district levy, and stormwater maintenance fees from Minnesota member entities. The program also will fund any unforeseen mitigation needs that may arise during operation.
The comprehensive project will follow an Adaptive Management and Monitoring Plan (AMMP) to monitor performance of environmental mitigation projects along with environmental changes after operations.
When CCJWRD created the FM Flood Risk Management District No. 1 under North Dakota law, it also created a maintenance district that allows CCJWRD to levy special assessments within the district for maintenance costs. The assessment will be based on benefits to each property. For example, agricultural properties within FM Flood Risk Management District No. 1 that were identified as receiving 100 percent benefits will pay $4 per acre per year and those that have been identified as receiving 50 percent benefit will pay $2 per acre per year.
The City of Moorhead will levy the Stormwater Maintenance Fee for the third funding source. Pursuant to the JPA, the Minnesota member entities will contribute about 2 percent of the annual O&M costs.