Global law firm Ashurst has advised The Metro Flood Diversion Authority in Fargo, North Dakota on a Design Build Finance Maintain P3 model to deliver, a 30 mile flood diversion channel, which reached financial close on October 13, 2021. It is one of the only flood diversion channels in the world to be procured as a P3, and is the first in North America.
The P3 project is part of a comprehensive project developed by the Metro Flood Diversion Authority, local stakeholders, and the United States Army Corps of Engineers (“USACE”) to establish permanent flood protection measures for more than 235,000 residents and businesses in the Fargo-Moorhead metropolitan area and surrounding rural communities. The comprehensive project is being implemented using a “Split Delivery” model under which the USACE is utilizing a design-bid-build model for various work packages to deliver the southern embankment and associated infrastructure (including, among other things, the diversion inlet control structures) and the Metro Flood Diversion Authority is utilizing a P3 delivery model to deliver the diversion channel and associated infrastructure (including, among other things, a diversion outlet, diversion line of protection, two pairs of interstate bridges, nine county road bridges, three local bridges, three railroad bridges, two aqueducts, two river inlets, twelve drain inlets and an administration building).
Ashurst worked closely with the Authority’s local counsel, Ohnstad Twichell, PC, together with the Authority’s financial (Ernst & Young Infrastructure Advisors, LLC) and technical advisors (Jacobs) over a number of years, to provide strategic and structuring advice on both the procurement structure and risk allocation on what is a ground-breaking project in the US (both in terms of (i) procurement and implementation of a flood diversion channel as a P3, and (ii) the procurement of a P3 component of a comprehensive project that is being delivered in conjunction with the USACE) and the first P3 project procured by the Authority.
The Ashurst team was led by counsel Ross McKinnon and Emily Gold Grunstein and included partners Anna Hermelin and Jason Radford, and associate Rebecca Roach.
Ross McKinnon and Emily Gold Grunstein commented, “We would like to congratulate the Metro Flood Diversion Authority and Red River Valley Alliance on achieving financial close on this transformational project. We commend the Authority, all the local stakeholders, the states of North Dakota and Minnesota, and the United States Army Corps of Engineers for their vision and collaboration in delivering permanent flood protection for the Fargo-Moorhead metropolitan area and surrounding rural communities, with all the social and economic benefits that it will bring. It has been an absolute privilege to work closely with the Authority and our co-advisors over a number of years with respect to this ground-breaking P3 project and we look forward to its successful delivery.”