Red River Valley Water Supply Project

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The second half of the North Dakota legislative session began in early March. Representatives of the Garrison Diversion Conservancy District (Garrison Diversion) and Lake Agassiz Water Authority (LAWA) are making frequent trips to Bismarck to provide testimony in support of the Red River Valley Water Supply Project (RRVWSP). Here is an overview of the bills we are watching closely.

House Bill 1020 – State Water Commission Budget
Garrison Diversion and Lake Agassiz are requesting $50 million in the State Water Commission’s budget for the 2021-2023 biennium. Construction got underway in December 2020, and if the RRVWSP is funded at the requested amount for the next two years, a lot of progress could be made.

“This level of funding would allow us to complete construction on the Missouri River intake and a segment of transmission pipeline, as well as complete additional land acquisition,” says Duane DeKrey, Garrison Diversion General Manager.

“Garrison Diversion and LAWA also requested legislative intent for the RRVWSP in HB 1020 to remove any uncertainty about the Project’s future,” says Merri Mooridian, Garrison Diversion Administrative Officer and Deputy Program Manager for RRVWSP Administration.

Finally, Garrison Diversion and Lake Agassiz are requesting a long-term, low-interest loan from the State to provide affordable and predictable financing for the local users of the RRVWSP. Specifically, a 40-year loan term with two percent interest is requested to ensure the smaller communities and rural water systems can gain affordable access to the drinking water and industrial water benefits the RRVWSP will provide.

“Participation in the Red River Valley Water Supply Project is an additional cost to the communities and water systems. They need to continue to operate their current systems, plus pay for access to this supplemental water supply. That is why a long-term, low-interest loan is necessary,” says Mooridian.

House Bill 1425 – Legacy Infrastructure Revolving Loan Fund
On March 29th, the Senate approved HB 1425, to continue appropriations to the Legacy Infrastructure Loan Fund. Garrison Diversion and LAWA strongly support the idea of a Legacy Infrastructure Revolving Loan Fund because it prioritizes critical infrastructure such as the RRVWSP and could increase affordability for end users.

Under House Bill 1425, up to $40 million loans are permitted, with terms of a maximum of 30 years with a cap of 2% interest rate. Garrison Diversion and LAWA had requested a 40-year loan term to make the payments more affordable for the Project’s end users. The bill now goes to Gov. Doug Burgum for his signature.

Senate Bill 2014 – Industrial Commission Bill
Similar to HB 1425, Garrison Diversion and LAWA have requested a 40-year loan term with two percent interest in SB 2014 to ensure participating communities and rural water systems can gain affordable access to the RRVWSP’s supplemental water supply.

“The Project’s useful life will certainly extend well past the requested 40-year loan term. Furthermore, a two percent, 40-year loan would make the project more accessible to the smaller water systems and cities. The drought resilience of nearly half the State of North Dakota is truly dependent on the affordability of this Project,” says Dr. Tim Mahoney, LAWA Chairman and Fargo Mayor.

“The RRVWSP’s project supporters would also like to see an increase in the cap on loan amounts, as that will allow a greater number of local water users to benefit from the Project. It will also allow the Project’s construction to remain on schedule if the end users have affordable access to loans with terms of 40-years at two percent interest,” explains Mahoney.

House Bill 1431 – Infrastructure Bonding Bill
Unfortunately, the RRVWSP was not named in a large infrastructure bonding bill that would use earnings from the Legacy Fund to repay investors. “It was disappointing to not be specifically named in the bonding bill. However, Garrison Diversion and LAWA remain optimistic about the RRVWSP being included as a water infrastructure project,” says DeKrey.

Garrison Diversion and LAWA continue to support using bonding for large infrastructure projects and supports HB 1431. “Investing in North Dakota infrastructure through bonding allows large water infrastructure projects to be built in a timely manner and not rely solely on the Resources Trust Fund,” says Mooridian.

The legislative session wraps up in late April. Updates will be provided in the next edition of the RRVWSP newsletter.