06-22-2017 - Laserfiche WebLink

General and Chief of the Army Corps of Engineers Todd Semonite has the talking points down on this project, and he uses them frequently on behalf of this community. He said no one will leave this room today thinking the Army Corps of Engineers is not committed to partner with this project and deliver it to completion. He said there are policy items to work through, including how the federal government looks at public/private partnerships from a policy perspective as it pertains to budgeting. He said members of Congress and the administration are trying to understand and improve this and are using the F-M Diversion project as a case study on how to do it right. He said the Economic Council is looking at the P3 as a way to deliver the infrastructure needed. He said Special Assistant to the President for Infrastructure D.J. Gribbin is an advocate of P3 work. He said the Corps has been able to work closely with Mr. Gribbin about road, rail and runway projects, as well as transportation and flood risk management, which falls in line with what the Corps is doing in Fargo-Moorhead. He is looking forward to answering questions as well as assuring the Diversion Authority the Corps is committed to this project and will continue to work to get it delivered. He said this is a split delivery project with the federal government responsible for the southern embankment and its associated control structures, and the Diversion Authority and the P3 contractor are responsible for the Diversion channel itself and the associated infrastructure. He said the entire project is clearly a federal project and as far as the coordination and oversight, the Corps is involved on the P3 side. He said this is a new process and the Corps’ first P3 project and they are learning as they go. He said the Corps is open to comments and suggestions on how to do it better. For example, he said, with real estate issues, the Corps has the ultimate authority, and with permitting, the Corps is used to doing that; however, when applied to a P3 project, it takes some adjustment, flexibility and creativity. He said the President’s FY18 budget and the Corps’ FY17 work plan came out last week and there was no money for the project in the FY18 budget. He said the same thing happened last year; however, the Corps did get $20 million in the work plan. He said he expects something similar this year. He said the $20 million will help continue the planning and design work. He said the Diversion inlet control project awarded $46 million to Ames Construction, who is currently at the site doing a lot of work. He said as the group was flying over the site, Terry Williams said it was a big effort to design that inlet control structure; however, the Corps is using lessons learned for the Wild Rice control structure and the Corps expects more of this as the project continues. He said the Corps will get more efficient as the project continues and will have better products and hopefully compress the build time. He said the Corps is hopeful when the FY18 work plan comes out in a few months, contracts can be awarded and they are able to stay on the timeline. In response to a question from Mr. Grindberg as whether the project gets a line item in the President’s budget or whether funding comes through a normal allocation, Mr. Lee said the President’s budget is about $5 billion with no earmarks. He said Congress gave the Corps a little more than $1 billion in FY17; however, those are the unnamed earmarks Congress feels the President has shortchanged the Corps, so they added that money in. He said whatever projects come out of the work plan are the projects most likely not budgeted in the President’s budget. Major Gen. Jackson said Congress gives the Corps beyond what the President allocates; however, Congress cannot say what projects the Corps spends it on. He said Congress can put the money into bins and tell the Corps to spend so much on navigation projects, so much on flood risk management projects or ecosystem restoration projects; however, what projects the Corps actually does have to go through the same process as budget development. He said in some cases, the administration will give additional funding to what they had already funded as a line item in the President’s budget and in other cases, they may opt to fund a project that for whatever reason did not meet budget guidelines for budget development. He said a big test is the benefit to cost ratio. He said many of the projects that get funded in the work plan are great projects; however, they do not have the benefit to cost ratio that makes them budgetable by the administration’s policy guidance for the President’s budget development. He said the Corps does not have to wait on a surplus in an appropriations bill. He said the Corps is using the work plan allocation to get the funding needed to move forward. He would like to get it in the budget for a lot of reasons, including when there are different types of financial situations, such as a financial resolution, it is helpful to have it as a line item if Congress appropriates it.