$57-Million Settlement Keeps Red River Diversion Project Out of Court

The contractor and the flood management authority for the huge Purple River diversion mission in North Dakota have resolved $400 million in claims with a $57-million settlement, a lot of it associated to the failure to make use of epoxy coating on rebar in elements of the mission to guard in opposition to corrosion.

The settlement clears away unresolved issues simply as new leaders take over at each mission companions they usually attempt to put the mission’s tumultuous previous and conflicts behind them.

Below the settlement, the Metro Flood Diversion Authority can pay $57 million in increments to the mission developer/contractor, the Purple River Valley Alliance, whose design building arm is ASN Constructors. The alliance had made a declare over the rebar coating and different issues.

The 13-member MFDA board unanimously permitted the settlement, which reduces the chance of unknown authorized prices and the delays that may end result from litigation, MFDA stated in a press release. The additional funds will come out of a contingency price range.

John Shockley, the authority’s normal counsel, stated that the $400 million in claims encompassed delays, change orders and other issues along with the epoxy coating. The settlement represents lower than 2 p.c of the $3.2-billion mission, he instructed the authority board at.a July 2nd assembly.

“Fifty-seven million {dollars} is clearly some huge cash, however typically with a big mission like this I feel typically it is applicable to step again and take a 30,000 ft view,” Shockley instructed the board.

Using epoxy-coated rebar had been a matter of some concern to the general public, Shockley added. The dispute centered on whether or not coated rebar can be utilized in all concrete buildings or solely these in a corrosive atmosphere.

The Fargo-Moorhead Space Diversion mission broke floor in 2017. Its 30-mile-long channel is the primary public-private partnership executed along with the U.S. Military Corps of Engineers and the first water management P3 in North America. It’s also the primary inexperienced finance initiative within the U.S. particularly designed for climate-change adaptation.

A partnership of ACCIONA, Shikun & Binui USA and North American Building Group, the Purple River Valley Alliance is the developer for the stormwater diversion channel and related Infrastructure portion of the general Fargo-Moorhead mission.

There’s a second main a part of the general mission. The Corps is delivering the portion that can stage the water and management its movement. The Corps additionally serves because the federal company overseeing the complete mission. 

The P3 mechanism permits the Fargo-Moorhead a part of the general mission to be constructed 10 years earlier than if the Corps was constructing it alone, saving thousands and thousands of {dollars}. 

In March 2025, Luke Chenery took the helm of the Purple River Valley Alliance as its CEO, and in February 2025 Jason Benson turned everlasting MFDA Govt Director.

Fargo Metropolis Administrator Michael Redlinger and Cass County Administrator Robert Wilson had been serving as co-executive administrators because the resignation a 12 months in the past of Joel Paulsen.

In a LinkedIn put up six months after his departure, Paulsen wrote that he nonetheless helps the mission “and I sincerely hope it is profitable however I’ve moved previous it and have centered on the only subject that led to my resignation, building disputes.”

The authority and the alliance had been awaiting steering on contract disagreements by the authority’s technical advisory dispute board. The board had heard the preliminary declare over the necessity to use epoxy-coated rebar in Fargo-Moorhead space diversion buildings in Could 2024 however was delayed by a grievance over open assembly necessities that the state legal professional normal needed to resolve.

Floor Coating Substituted

ASN Constructors started incorporating epoxy-coated rebar in concrete buildings in July of final 12 months, MFDA reported in a press release, however concrete buildings accomplished with out coated rebar could have their surfaces coated with what the MFDA calls a “protecting product” referred to as Tex-Cote®. Below the settlement, a coating will probably be made at substantial completion and re-coatings made as dictated by the producer’s specs.

The change in in management and wait “introduced a chance for a collective evaluate of previous and current disputes,” stated Benson. “We’ve reaffirmed our dedication to working collectively and established extra check-ins and collaborative approaches which can be anticipated to cut back the necessity for formal battle decision processes.” Chenery expressed the identical sentiments.

“By our small management staff discussions, the events have been in a position to attain this technical answer, with out the necessity to take away and exchange beforehand accomplished buildings, which helps to maintain the mission on time and prevents financial waste,” Benson stated.

with extra reporting by Jennifer Seward