July 2, 2025
MFDA Reaches Settlement with Developer
FARGO, ND (July 2, 2025) – The Metro Flood Diversion Authority today reached a settlement with the Red River Valley Alliance regarding outstanding claims tied to the FM Area Diversion project.
“This is a positive development for the project as it allows us to move forward with a clean slate to complete this necessary flood protection. The MFDA is doing its part to ensure RRVA meets their proposed schedule,” said Cass County Commissioner Tony Grindberg, the MFDA Board chairman.
The agreement, which the 13-member MFD Board unanimously approved, includes provisions that support the schedule for RRVA and their design construction arm, ASN Constructors, to be on track for substantial completion in 2027. The agreement is expected to be formally approved by the developer and design and construction contractor’s boards on July 3. It promotes and incentivizes a more collaborative approach to accomplishing the necessary work on time.
“With both partners coming under new executive leadership while awaiting guidance on contract disagreements, it presented an opportunity for a collective review of past and present disputes,” said MFDA Executive Director Jason Benson, who stepped into the role in February 2025. “We have reaffirmed our commitment to working together and established additional check-ins and collaborative approaches that are anticipated to reduce the need for formal conflict resolution processes.”
In March 2025, Luke Chenery took the helm of RRVA as its CEO.
“I’m very thankful that we have been able to settle our numerous construction claims and disputes to allow us to collectively move forward toward our ultimate goal of completing this historic project on schedule. Our mission is to provide permanent, reliable flood protection to the people of the Fargo-Moorhead metro,” said Luke Chenery, RRVA CEO. “RRVA is proud to be a part of this community, and we will be here for the long-term, fulfilling our obligation to operate and maintain the stormwater diversion channel and associated infrastructure for the next 30 years.”
By eliminating current claims and agreeing to a specific settlement amount, the MFDA has reduced its risk of the cost of those claims by eliminating the unknown legal costs, time and ongoing delays that would result from litigating the issues in dispute. The settlement amount of $57 million will come out of the MFDA’s comprehensive project contingency budget, leaving the overall comprehensive project cost unaffected. The lump sum will be made in smaller payments tied to substantial completion of individual components of the project, including $7 million for completion of the Diversion Outlet and Rush River Inlet and $5 million each for the completion of the Maple River Aqueduct and Sheyenne River Aqueduct. Payments of $5 million also will be issued for substantial completion of road and railroad bridges.
“I’m glad that we can keep this important project moving forward on schedule but also to do so without impacting the existing budget,” said West Fargo Mayor Bernie Dardis, chairman of the MFDA Finance Committee.
Prior to the agreement, claims were waiting to be heard by a Technical Dispute Review Board comprised of independent experts in public-private partnership contracts. The initial claim, regarding the use of epoxy-coated rebar in FM Area Diversion structures, went to the TDRB in May 2024. It was not heard, however, as the TDRB awaited an attorney general’s opinion on open meeting requirements. A new panel of TDRB members was seated in May 2025, but they will no longer be needed to weigh in on the rebar issue since it’s been resolved in the settlement agreement.
ASN Constructors began incorporating epoxy-coated rebar in concrete structures in July of last year. Concrete structures that incorporated uncoated rebar placed prior to that timeframe will be coated with a protective product called Tex-Cote® prior to substantial completion, monitored throughout RRVA’s 30-year operations and maintenance contract for the FM Area Diversion – during which time a second coat will be applied – and receive another Tex-Cote® treatment prior to the components being handed back to the MFDA.
“Through our small leadership team discussions, the parties were able to reach this technical solution, without the need to remove and replace previously completed structures, which helps to keep the project on time and prevents economic waste,” Benson said.
About the Metro Flood Diversion Authority
The MFDA is a permanent North Dakota political subdivision that is cooperatively implementing the Fargo-Moorhead Area Diversion comprehensive project with the U.S. Army Corps of Engineers. The MFDA works in partnership with the Red River Valley Alliance in a public-private partnership as well as the City of Fargo, City of Moorhead, Cass County, Clay County and the Cass County Joint Water Resource District.
About the Red River Valley Alliance
The RRVA is the developer for the Stormwater Diversion Channel and Associated Infrastructure (SWDCAI) portion of the Fargo-Moorhead Area Diversion project. The RRVA is a partnership of ACCIONA, Shikun & Binui USA and North American Construction Group. The RRVA is responsible for the development, design and construction of the stormwater diversion channel as well as 19 road and railway crossings, two aqueducts, multiple inlets and the diversion outlet. In addition, the RRVA will operate and maintain the channel and associated infrastructure for a period of 30 years.