Louisiana Secures Alternative Funding for $366M Flood Protection Project

Mon December 21, 2020 - Southeast Edition
CEG

The Houma Navigational Canal Project is advancing to construction using an alternative financing plan.
The Houma Navigational Canal Project is advancing to construction using an alternative financing plan.

Louisiana officials have announced that construction on a $366 million flood protection project will begin using an alternative financing plan approved by the state legislature earlier this year.

The Louisiana Coastal Protection and Restoration Authority (CPRA) said Dec. 9 that the plan will be used for the flood-protection lock project in the Houma Navigation Canal (HNC). It will allow the agency to incur debt or issue bonds to pay for projects. The lock will play a critical role in Terrebonne Parish's hurricane protection system.

The project also aims to shield inland communities from storm surges. CRPA officials said the first phase of the construction will begin next year.

CPRA is utilizing recent legislative authority via Act 89 of the 2020 Regular Legislative Session, giving the department the authority to finance coastal restoration projects by entering debt obligations within the regulatory and oversight process of the State Bond Commission set out in existing law.

The HNC Project is currently proposed to be funded with RESTORE Bucket 3, and CPRA is finalizing the grant process. The alternative financing plan is intended to provide gap financing during the HNC Phase 2 construction period and until CPRA receives the annual RESTORE Bucket 3 payments.

The Authority anticipates starting the competitive process for securing capital market financing a few months prior to the bid of Phase 2.

"We are aggressively finding ways through funding and delivery methods to advance more projects to implementation as quickly as possible," said CPRA Chairman Chip Kline. "HNC is a critically important hurricane protection and ecosystem restoration structure, and we are thrilled to have identified a way to expedite its construction. We are leaving no stone unturned in order to make our Coastal Master Plan a reality."

CPRA's traditional approach involved waiting until the entirety of allocated funds was available before moving projects to construction.

"As a result of this new legislation, we will be able to advance construction of this important project by about four years," said CPRA Executive Director Bren Haase. "This is a truly integrated project in that it provides both ecosystem restoration and hurricane protection benefit for Louisiana's coastal citizens."

The HNC Lock Complex Project is contained in the Louisiana Coastal Master Plan and 2021 Annual Plan (Project TE-113) as a hydrologic restoration project and is needed to reduce saltwater intrusion and distribute fresh water within the Terrebonne Basin, an area which is experiencing one of the highest rates of land loss in coastal Louisiana. The restoration will help limit the intrusion of salt water into freshwater marsh systems allowing for the maintenance of thousands of acres of wetlands which serve as critical wildlife habitat and nurseries for fisheries.

Additionally, HNC also will provide crucial flood protection by blocking storm surge as a key component of the Morganza to the Gulf Hurricane Protection Project.

"The saltwater intrusion and freshwater diversion aspects of the HNC Lock System are huge environmental wins for Terrebonne Parish that will forever positively impact the ecosystem," said Terrebonne Parish President Gordy Dove. "This is also a major economic win in that it will improve the nonstop navigation of the marine industry which is the economic backbone of Terrebonne."

In 2013, the Terrebonne Levee & Conservation District (TLCD) constructed a $50 million barge floodgate known as the HNC "Bubba Dove" Floodgate with combined state and local funds. The new lock project will incorporate the existing floodgate as part of the complex.

"The HNC Lock Complex is the main anchor and most important structure of the entire 98-mile Morganza to the Gulf Hurricane Risk Reduction Project," said Reggie Dupre, executive director of TLCD. "In addition to the environmental benefits of the lock complex, we will now be able to better provide mariners with safe harbor when we are facing tropical weather threats."

CPRA anticipates beginning Phase 1 in 2021, while Phase 2, the construction portion of the project, is expected to begin in 2022.