Diversion Authority approves amendment allowing nonfederal sponsors early access to federal funds

The Metro Flood Diversion Authority board on April 27 approved Project Partnership Agreement Amendment No. 2, a change that will permit non‑federal sponsors to access unused federal funds before final project closeout, authority staff said.

John Shockley, who presented the amendment to the board, said the change does not create a financial cost for the diversion authority and instead allows funds to be returned to non‑federal sponsors earlier than the previously envisioned 2029–2030 closeout. “This project, PPA amendment number 2, will allow the non‑federal sponsors to access those funds early,” Shockley said. “There's no financial cost to the diversion authority.”

The amendment was recommended by the Finance Committee and approved by the board in a roll‑call vote. A signing ceremony for the PPA amendment is scheduled for May 7 at 2 p.m., and Assistant Secretary of the Army for Civil Works Adam Tell is expected to attend, staff said.

Why it matters: allowing non‑federal sponsors to draw down available federal funds sooner improves short‑term cash flow for sponsors and can accelerate completion of remaining projects that need local matches or supplemental funding. The authority presented the amendment as a cash‑management change rather than a new appropriation.

Other finance items and background: staff also briefed the board on federal financing and potential short‑term borrowing. The most recent WIFIA draw was $47,500,000 on a $569,000,000 loan, and staff said they expect additional draws by late April or early May depending on developer pay requests. Staff outlined a possible short‑term subordinated sales‑tax bond of roughly $220,000,000 as a 3–6 year tranche to close out remaining cash‑flow items; timing will depend on market interest rates.

The board additionally approved several related housekeeping votes during the meeting, including a resolution setting a minimum retention period for executive‑session recordings under the open‑records law and a resolution authorizing up to $32 million of federal funds to be used as a 50/50 match for Minnesota bonding requests.

Votes at a glance: • Project Partnership Agreement Amendment No. 2 — approved by roll call (see meeting record). John Shockley said the amendment allows early access to federal funds and that the City of Fargo and other non‑federal sponsors have been coordinating approvals. • Resolution on executive session recordings — approved by roll call; staff said the resolution recites current North Dakota open records requirements and sets a six‑month minimum retention. • Resolution authorizing up to $32 million federal match (50/50) for Minnesota projects — approved by roll call; finance committee had recommended approval.

What’s next: the authority will proceed with the PPA amendment signing event on May 7 and staff said they will continue to manage WIFIA draws and evaluate bond‑issuance timing to minimize interest cost for the authority.

Reported at the meeting: a number of board members and staff praised the work of project teams and committees that advanced the amendment and the finance recommendations. The board did not identify any fiscal exposure to the authority resulting from the amendment itself.