Letter to Legislators: Use of Environmental and Natural Resources Trust Fund Dollars

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RE: Use of Environment and Natural Resources Trust Fund Dollars HF3352/SF2934

May 18, 2018

Dear Legislators,

On behalf of the 39 undersigned organizations, we urge you to oppose any version of the Legislative Citizen Commission on Minnesota Resources (LCCMR) bill that attempts to spend Environment and Natural Resources Trust Funds (ENRTF) for bonding for wastewater infrastructure projects. The version of this bill passed by the Senate, SF2934, includes language which uses the ENRTF to fund the debt service for $47 million of appropriation bonds. Since 1963, approximately $900 million has been appropriated from the Fund to more than 2,000 projects that protect and enhance Minnesota’s environment and natural resources. Throughout its history, we have advocated to ensure that ENRTF funds are spent in ways that are both constitutionally and statutorily appropriate. Therefore, we again urge you to vote against a bill that includes this proposal that would misuse ENRTF dollars.

Per the language of the Senate version, the ENRTF would be used to pay the debt service on bonds for wastewater infrastructure in cities and towns with populations under 5,000. Bonding costs for such wastewater projects have traditionally been provided through the general fund, and there is no precedent for using the ENRTF for this purpose. In fact, the adopted Senate language includes a change to Minn. Stat. 116P.08 altering the allowable use of funds:

“Sect. 2 Subdivision 1 (a) (9): to pay principal and interest on special appropriation trust fund bonds issued pursuant to section 16A.969 and other law.”

The addition of this language puts this proposal in conflict with Minn. Stat. 116P.03 (a) which provides clear direction for the ENRTF and states:

“The trust fund may not be used as a substitute for traditional sources of funding environmental and natural resources activities.

When Minnesota voters overwhelmingly approved the current dedication of the state lottery proceeds twenty years ago, it was with the clear understanding that none of these funds would be used for wastewater treatment facilities. This is codified in Minn. Stat. 116P.08 Subd. 2:

“Money from the trust fund may not be spent for: …2) purposes of municipal water pollution control under the authority of chapters 115 and 116.”

The proceeds from the proposed bond authorization would be targeted to these very purposes that are expressly excluded from eligibility. Minnesota voters chose to dedicate these funds for very specific purposes of protecting our Great Outdoors for future generations and we urge you to oppose any proposal that would eliminate the protections and specific purposes of the fund. This debt service proposal would result in a violation of the trust of Minnesota voters.

The fiscal viability of this proposal raises serious concerns. The interest costs alone on $47 million of appropriation bonds could be in excess of $25 million in additional costs to the ENRTF over the 20-year period, yet this proposal has no fiscal note that outlines any of these costs or their impacts on the fund. This proposal would raid the fund until 2040, though the funds’ revenue source constitutionally expires on December 31, 2024.

Despite this dramatic and permanent change to the ENRTF and despite its potentially far-reaching financial consequences, this proposal has not been properly vetted by members of the public or the Legislative-Citizens Commission on Minnesota Resources (LCCMR). Minnesotans expect and deserve an opportunity to voice their opinions about spending from constitutionally-dedicated funds.

Because the proposed House and Senate bonding bills are well under the state’s official debt capacity, the Legislature has other options for securing funding for these important state investments in wastewater infrastructure, instead of raids that divert precious resources away from their intended purposes. We encourage you to respect the intent of Minnesota voters and oppose misuse of the Environment and Natural Resources Trust Fund.


Alliance for Sustainability
Anglers for Habitat
Audubon Minnesota
Cannon River Watershed Partnership
Clean Water Action – Minnesota
Conservation Minnesota
The Conservation Fund
CURE (Clean Up the River Environment)
Environment Minnesota
Fish & Wildlife Legislative Alliance
Freshwater Society
Friends of MN Scientific & Natural Areas
Friends of the Boundary Waters Wilderness
Friends of the Mississippi River
Great River Greening
Izaak Walton League – Minnesota Division
Minnesota Center for Environmental Advocacy
Lower Phalen Creek Project
Minnesota Conservation Federation
Minnesota Deer Hunters Association
Minnesota Land Trust
Minnesota Environmental Partnership
Minnesota Ornithologists Union
Minnesota Lakes and Rivers Advocates
Minnesota Trout Unlimited
Minnesota Native Plant Society
Minnesota Outdoor Heritage Alliance
Parks and Trails Council of Minnesota
Minnesota Waterfowl Association
Pollinator Friendly Alliance
The Nature Conservancy – Minnesota
Sierra Club – North Star Chapter
Pheasants Forever
Trust for Public Land
Save our Sky Blue Waters
Wilderness in the City
St. Croix River Association
Women’s Congress for Future Generations

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