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Amid high costs, city council debates slowing flood project

Another phase of flood protection advanced through the Minot City Council Monday, but not without emotional debate over the costs of slowing or pushing ahead on the overall project.

Council member Rob Fuller said flood control bids in the past few months have been egregious and will hurt the city in the long run. The council on Monday accepted a bid that was 35% over the engineer’s estimate.

“The financial implications of 35 percent cost increases raise significant concerns about the economic viability of our flood control program. As a community, we’ve got to sit back and evaluate whether the projected benefits justify the financial burden on taxpayers and local businesses. We’re discussing a billion dollar project that could balloon to $1.3 billion or more, for a flood event expected to occur only once every 100 to 500 years,” Fuller said. “Now, I understand and I realize the flood of 2011 was devastating to our community. But if we don’t do things correctly, the financial impact that we’re going to put on our future generations could be. just as devastating to them.”

He noted the city’s current share of project costs comes to $350 million. If project costs balloon to $1.3 billion, the city’s share goes to $472 million, he said.

“We have flood control bonds out there right now for 30 years. If we see an increase like that, that adds 10 years to how long we’re going to have to have our kids and our grandkids and everybody else pay for these flood control bonds,” Fuller said. “It may be time for us as a community to sit down and honestly look at either pausing or slowing down flood control until the cost inflation in the broader economy stabilizes. I’m not suggesting at all we halt anything, but let’s be clear. By pausing, this can help us avoid some of the competing costs that we’re eating because Fargo is doing a flood control program right now. There’s only so many resources to come to North Dakota and do flood control.”

Council member Mike Blessum also called flood control an incredible burden on future city residents.

“Do we have a blank check out there for whoever does this work, because that’s what it feels like, and it seems never ending,” he said. “You can make the argument that waiting six months makes this even worse. I get that. I understand that completely, but, my goodness, where are we headed then? I think we’re close to off the cliff now.”

“We don’t feel good about it either,” said Jason Sorenson, Utilities director for the City of Minot. However, he added, “I don’t think we are opening up the checkbook and just writing blank checks. That’s certainly not the objective of the Souris River Joint Board. It’s just a tough market. There aren’t enough really big contractors that can handle projects this big.”

The joint board in the future will be looking at breaking large contracts into smaller projects that more contractors can handle, he said.

Blessum questioned whether the tough environment will improve in a few years.

Sorenson said it is unpredictable. As the city’s representative on the joint board, he said he is not willing to gamble that prices will improve in a few years.

“We’re somewhat in a race against time. Yes, this is costing us a lot of money on the sales tax side, but what it’s going to cost us in the future is a lot of money from every single resident that lives in the valley. There are going to be some pretty staggering insurance rates that come because we don’t have protection in the city,” Sorenson said.

Former mayor and insurance agent Shaun Sipma, whose house was damaged in the 2011 flood, objected to talk of delaying the project by several years. If the project is not finished until 2041, valley residents will have paid $55 million to $75 million in insurance premiums, depending on FEMA decisions on rates, Sipma said.

“To be fair, Alderman Fuller, I have never felt more like a second rate citizen than I do tonight,” he said. “After all of the hard work that is put in, and we talk about optics – that echoes through the state Legislature when we go down to testify to get support from the state.

“You’re right. It is going to be difficult. We either have resolve or we don’t,” he said.

“You are standing up here trying to scare everybody about what’s going to happen with rates going forward. I get it. I understand that. But what I’m talking about is happening right now. Thirty percent to 40 percent over the estimates is not feasible,” Fuller responded.

“I’m not saying we need to stop flood control,” he added. “But what I’m saying is we have to be fiscally responsible to this city and the residents of this city in the next 30 to 40 years, and by paying $1.3 billion, when maybe we could do something at $700 or $800 or $900 million and scale it back a little bit.”

Sipma said the rate increases aren’t scare tactics but direct verbiage from the National Flood Insurance Program. Reducing the size of the flood project to save 10-15% in cost will substantially reduce flood control, he said.

Inflation over time was anticipated when the project began, Sipma said, objecting that Sorenson and others associated with the project were being “dressed down” by council members.

“With all due respect, I’m not going to just sit by and be accused of dressing people down for doing the job I was elected to do,” Blessum replied. “You have no idea what my vote will be. You have no idea what my plan would be for going forward with this, but I am going to do my job and ask questions.”

Blessum said he likely would approve the spending because he doesn’t see another path forward.

“But I was elected to have this conversation, and to not have it is the issue,” he said. “So, we will continue to have these conversations.”

Sipma conceded it is an emotional topic for him.

“Absolutely, ask questions. But there are optics, as was mentioned, that echo not only the state, but then come back locally,” he said.

Blessum responded the other side of the optics says to contractors that they can charge whatever they want.

Sipma recommended council members just show understanding when it comes to community partners and how they are addressed and of valley residents who have been through a devastating flood.

The council voted 5-2 to concur with the joint board on the award of flood phase MI-6B to Park Construction for $52.8 million. The project had been rebid after coming in about 39% over the engineer’s estimate in May. The project scope and deadlines were modified and rebidding in September resulted in a low bid 35% over the estimate. There were two bidders.

The project consists of levee and floodwall from Main Street north of downtown, extending along the river and terminating at a stormwater pump station near the Roosevelt Park pool.

Voting against bid acceptance were Fuller and Scott Samuelson.

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