LANSING – Whether the state will be able to use Natural Resources Trust Fund grants to pay for dredging projects appears to hedge on the Legislature’s latitude in defining development.

Legislation discussed Thursday in the Senate Outdoor Recreation Committee (SB 229 ) would define dredging as a development activity and allow the trust fund board to consider those projects in doling out grants each year.

Supporters said the move was part of a long term funding solution for dredging, but opponents said to plan goes beyond the constitutional limits on use of the funds.

“I believe the trust fund already allows for this,” Sen. John Moolenaar (R-Midland), sponsor of the bill, said. “It has regularly been used to fund a variety of infrastructure projects.”

In particular, he noted the Constitution allows the funds to be used for “access”, and he said it was not possible to access some of the harbors unless they are dredged.

Sen. Tom Casperson (R-Escanaba) said the funds also should be available for dredging inland lakes where there are chains of lakes with connecting channels that fill with silt.

But Department of Natural Resources officials and various environmental groups said dredging is clearly maintenance, not development, and so is not allowed with the trust fund revenue.

“From our legal perspective, maintenance would not fall under development,” said Trevor VanDyke, legislative liaison for the DNR.

Others said there is a clear line between development and maintenance, noting that the State Parks Endowment Fund, which receives Natural Resources Trust Fund revenues in excess of the cap on that fund, specifically allows for maintenance.

“We use the trust fund to put in a dock; we do not allow the trust fund to paint the dock,” Amy Trotter with the Michigan United Conservation Clubs said.

“I can anticipate silt build up; that’s ongoing maintenance,” Brad Garmon with the Michigan Environmental Council said. “You should build that into your budget.”

VanDyke also warned that, at an estimated $10 million annually, dredging projects would use up all the funds available for development projects each year.

But committee Republicans were concerned that the department was interpreting the program, and setting requirements, without legislative input. Several members asked VanDyke to come back with legal opinions or statutory language that supported the criteria the trust fund board was using in scoring grant applications.

“It seems like the Legislature’s been entrusted with something but a lot of things happened without the Legislature’s input,” Casperson said.

Moolenaar added: “It seems to me it would be up to the Legislature to clarify that.”

“If we believe there’s an area where dredging would help develop an area, the Constitution gives us the right to define that,” Sen. Dave Hildenbrand (R-Lowell) said.

Sen. Coleman Young II (D-Detroit) said the committee should seek an attorney general opinion on the issue before moving ahead with the plan.

Casperson said the discussion raises a larger concern with the trust fund: it encourages the state and communities to purchase and develop facilities with no plan to maintain them. “If we don’t figure out a way to maintain what we’re buying, we’re headed down a pretty bad path,” he said.

Committee members agreed with Julie Stoneman of the Heart of the Lakes Center for Land Conservation Policy that the state should be pushing the federal government to cover some of the dredging costs, noting that there are federal funds appropriated for that purpose that are not being used.

“We shouldn’t even be having this discussion,” Hansen said. “But if we don’t take care of ourselves then we’re not doing our job.”

TIFA: The committee will likely move a less controversial measure for funding dredging projects (SB 218 ) at its next meeting. The bill reinstates the Water Resources Improvement Tax Increment Finance Authority, which expired in 2011, expanding both the area it can cover and its uses.

If a community develops an authority, it could still be used for invasive species controls, but it also could fund dredging projects. The new authorities could cover properties as far as 1 mile inland from the shore, as far as 5 miles up a tributary, and as far as 1 mile from the shores of a tributary.

There was little discussion and no opposition to the proposal.

VanDyke said there were still some technical changes the department needed to make the new legislation work.

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