The federal government and a south Texas county have finalized an agreement to build a combination of levees and border fence, a project aimed at addressing national security concerns and local flood-control needs at the same time.

The agreement announced Monday calls for the federal government to pay about $65.7 million of the $113.9 million project along 22 miles of the Rio Grande. It also puts Hidalgo County's long-awaited levee improvements on a fast-track to finish in less than a year.

Homeland Security Secretary Michael Chertoff announced the plan in February, hailing it as a rare compromise in the contentious fight between local and federal government on the border fence.

Many residents and elected leaders in the Rio Grande Valley have bristled at the idea of a fence, fearing the loss of private land and the message it would send to their sister communities in Mexico.

The plan soon raised environmental concerns because it replaced a planned fence that small wildlife could pass through with a 16- to 18-foot high impermeable concrete wall.

The U.S. Fish and Wildlife Service said it could not sign off on the project, but last month Chertoff announced he was using authority Congress granted him to bypass three dozen laws, including many environmental statutes, to build hundreds of miles of fence in Hidalgo County and elsewhere along the U.S.-Mexico border.

The agreement, hammered out between federal and county attorneys late Friday, includes two timelines for the project — a substantial completion date of Dec. 30 and a full completion date of March 31, 2009. County attorney Steve Crain declined to elaborate on what constituted substantial completion.

The source of the drainage district's $48.1 million contribution was not clear. Crain said county officials were reviewing financing options. Hidalgo County had initially offered to use a portion of a bond sale to pay for the project before seeking reimbursement from the federal government.

The county had been lobbying for help to improve its levees since New Orleans' levees failed when Hurricane Katrina hit in 2005.