Committee authorizes preliminary statement for subordinated sales‑tax bonds and agrees to 50/50 match for Minnesota grant applications

The Diversion Authority Finance Committee on June 24 approved two resolutions to advance project financing and grant matching for Minnesota partners.

John Shockley, attorney for the authority, said the board was being asked to authorize distribution of a preliminary official statement for subordinated sales‑tax bonds totaling about $255 million. Shockley said roughly $35 million of that amount would refund two capital improvement bonds currently held by the City of Fargo and the remaining proceeds would complete the capital financing for remaining project items. He described the bond as a six‑year, interest‑only structure with a bullet maturity at the end of the term.

Shockley also asked the committee to amend the authority's 50/50 match policy so the Diversion Authority can provide a match for two grant applications the City of Moorhead plans to submit for lift stations Nos. 7 and 11; Shockley said the amendment only applies if Moorhead receives the grants. "It essentially allows them to say for every dollar the state of Minnesota gives... they'll get a dollar from the diversion authority," he said.

On a related financing update, Shockley reported staff will submit a WIFIA draw in the next few days for roughly $15 million and that WIFIA typically processes draws quickly; the proceeds are expected to appear in the authority account in July.

The committee moved, seconded and approved the resolutions for items 9A and 9B by roll call.

Why it matters: the bond authorization and match amendment move significant financing decisions forward and affect the project's capital plan and partner grant competitiveness; the WIFIA draw will augment near‑term cash available for contractor payments.