The Metro Flood Diversion Authority on July 24 approved a $20 million amendment to its 2025 cash budget to implement payments required under a settlement agreement with the project’s public-private (P3) developer. The board voted to obligate the money from the P3 program contingency so the authority can make the payments outlined in the settlement.

The amendment, presented to the board as a budget change request, moves $20,000,000 from the P3 program contingency into the authority’s cash budget. “As was stated earlier, the first $10,000,000 has been paid to the developer per the settlement agreement. There is another $10,000,000 payment that’ll probably come due before the end of the year,” the staff presenter explained while reviewing the request.

The change increases the 2025 cash budget from $427,555,689 to $447,555,689 to cover the two payments. Finance committee review preceded the board vote; the committee recommended approval and the full board adopted the amendment by roll call.

Why this matters: the payments are part of a broader settlement that resolves previously asserted claims between the authority and the P3 contractor. Authority leadership said resolving the claims reduces near-term litigation and constructions risks and helps reset working relationships between the authority and the P3 teams.

Details of the settlement and implementation
The settlement — repeatedly referenced in the meeting as the “statement of principles” and “settlement agreement” — resolved previously filed claims, including what staff characterized as roughly $400,000,000 in disputed claims. Staff said the settlement includes mechanisms to reduce and resolve future claims more quickly and at lower levels, and requires implementing an amended and restated project agreement that will be provided to lenders for review and consent before returning to the board for formal approval.

John Shockley, a staff member who updated the board on the dispute resolution board, said: “Pursuant to this settlement agreement that was reached with the developer, all of the claims that had been formally referred to the DRB [technical Dispute Resolution Board] have been withdrawn with prejudice by the parties.” Shockley added that the technical DRB held its first organizational meeting July 15 and will meet quarterly per its operating procedures.

Budget action and vote
Staff asked the board to obligate $20,000,000 from the P3 contingency line to cover the two payments called for in the settlement. The finance presenter said the first $10,000,000 installment has been paid; a second payment of about $10,000,000 is likely by year‑end pending completion of certain contract closeout items.

A board member moved approval, a second was offered, and the board approved the budget amendment by roll call. The board’s roll-call reflected unanimous support for the amendment.

What the board did not finalize today
Staff said an amended and restated project agreement is being finalized and will be circulated to lenders for consent; the agreement will return to the board for formal approval after lenders review. Staff also said additional implementation tasks remain — including DRB scheduling, lender consents, and administrative steps to process the payments.

Looking forward
Board members and staff described the settlement and the budget amendment as steps to stabilize project delivery and to reduce the near‑term dispute burden so teams can focus on construction completion and transition to operations and maintenance. Staff emphasized ongoing financial work with state and federal partners, and that conversations continue with Minnesota and federal lawmakers about additional funding needs.