Marcus Larson: Fargo Diversion Authority Doubling Down on a Bad Gamble

State and local taxpayers recently purchased $50,000,000.00 worth of upscale properties in Oxbow, ND, a small town 15 mile south of Fargo.

The tax payer cost for these properties, more than 40 residences, averaged over one million dollars apiece (see buyout list below).

Owners of the private golf course club house building, which had an assessed value of $1,085,000.00, received a ten million dollar taxpayer buyout. These properties are now owned by the Cass County Joint Water Resource District on behalf of the FM Diversion Authority.

Here are pictures of some of these high end houses:

Last month the Fargo Diversion Authority engaged a contractor to start demolishing these residences. These buyouts were not necessary for flood protection. This community is located on high ground, well above the regulatory flood plain. Oxbow’s mayor certified back in 2011 that these homes were not flood prone. All the flood prone homes in Oxbow were bought out and removed after the 2009 flood. Further, according to Oxbow’s mayor (PDF), after the 2009 flood the city completed permanent flood protection to near the “500 year level.”

[mks_pullquote align=”left” width=”300″ size=”24″ bg_color=”#ffffff” txt_color=”#000000″]At a time when state revenues are at record deficits requiring painful across the board cuts, we can’t afford to allow Fargo’s leaders to throw away $50,000,000.00 in public assets.[/mks_pullquote]

Fargo’s leaders jumped the gun and spent 50 million tax payer dollars to acquire these properties in anticipation of getting permits to dam the Red River. The plan was to build a huge ring dike on the site of these properties to protect the town and its private golf course from the reservoir waters created by the proposed dam.

On October 3, 2016, Minnesota denied the FM Diversion’s Authority’s permit application to dam the river. In a 52 page decision the Minnesota DNR found that Fargo’s diversion plan is more about development than flood protection.

Previously a federal judge ruled that the FM Diversion must comply with MN law and issued an injunction stopping ring dike construction in Oxbow.

That decision was appealed by Fargo to the US Court of Appeals.

Fargo lost. The injunction stands.

This month the State of Minnesota decided to join the Federal Law suit against the Diversion Authority seeking a permanent order against Fargo’s Diversion project. Both federal and state law forbids Fargo’s project from proceeding without the required state permits.

Despite no permits and no prospect of ever getting them, Fargo’s leaders let a contract last month to start demolishing these houses. These assets should be preserved, maintained and sold once the court issues its permanent injunction against the Red River dam. Even if sold at 50%, taxpayers would recoup more than $25,000,000.00 lost as a result of Fargo’s bad gamble.

At a time when state revenues are at record deficits requiring painful across the board cuts, we can’t afford to allow Fargo’s leaders to throw away $50,000,000.00 in public assets. This is especially true when these same Fargo leaders are traveling to Bismarck asking for even more state funds for their doomed diversion project.

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