Northern Michigan Residents Praise Natural Resources Trust Fund at Town Hall

When we first heard that legislators planned to host town hall meetings on the Michigan Natural Resources Trust Fund, we thought, “here we go again.” Monday night’s town hall in Roscommon, though, was much more of a conversation between northern Michigan residents and legislators and, significantly, not one person said “we have too much public land.”
The Michigan Natural Resources Trust Fund was created in 1976 and protected in the Michigan Constitution in 1984 to receive the royalties from the sale of state-owned oil, gas and mineral rights. It funds public recreation land acquisition and public recreation facilities development.  It reached its $500 million cap in 2011 and royalties are now deposited into the State Parks Endowment Fund until it reaches its $800 million cap, after which they would go into the general fund, unless changes are made to keep future royalties for conservation and natural resources recreation projects, as they are now.
Representatives Andrea LaFontaine (R – Columbus Twp.) and Bruce Rendon (R – Lake City) organized the meeting, the first of a series around the state. Rep. LaFontaine, who chairs the House Committee on Natural Resources, said that the purpose of the meetings was to spark awareness of the Trust Fund, have a conversation, gather ideas, and that they “are not here to raid it.” She also said that after meetings with stakeholder groups – which included MUCC – there was a clear interest in making sure that oil and gas royalties continued to fund natural resources projects.
The crowd comments echoed that sentiment. Diane Randall, Roscommon Township Supervisor, said about the Trust Fund, “Please continue it. It’s been a tremendous help to our community.”
Frank Homola, Garrish Township Supervisor, gave a presentation on a marina renovated with Trust Fund money and said, “Every community up here relies on recreation.” He said that without the Trust Fund, the marina would likely be condos and the public would have lost the access the marina provides to Higgins Lake.
Kalkaska community representatives also echoed their appreciation for the Trust Fund, wishing it could provide more funding than it currently does each year (only the interest on the $500 million Trust Fund can be awarded as grants). Another suggestion was to raise the cap on the Trust Fund so that additional oil and gas royalties could be deposited into it.
Gaylord’s Dave Smethurst said, “the Trust Fund works,” both for local communities and for the people of the state. He suggested that future royalties could be deposited into a third conservation fund after the State Parks Endowment Fund reaches its $800 million cap (it’s currently at about $175 million). The third fund could be used for projects like removing deteriorating and failing dams, using as an example the Pigeon River dam which failed in 2008 and caused a massive fish kill in the blue ribbon trout river. MUCC members adopted a similar resolution at our annual convention this year to create a Fish & Wildlife Habitat Trust Fund that would receive the state’s oil and gas royalties once the State Parks Endowment Fund is full.
David Smith, of Crawford County, said that of the fifteen Trust Fund projects awarded in his county, he’s personally used at least thirteen of them.
Patrick Ertel, of Grayling, emphasized why it is important for oil and gas royalties to fund conservation projects. He lives near a new gas well that swallowed his favorite public land bird-hunting area and blueberry patch. “If the revenues from that well didn’t go back into conservation,” he said, “I would be really mad.”
Various pieces of legislation over the past few years have proposed to divert trust fund money to non-conservation or short-term uses, such as road funding, dredging and logging and mining roads. This Spring, though, Attorney General Bill Schuette issued an opinion that the Trust Fund could not be used for maintenance purposes under the Michigan Constitution. Referencing some of those specific proposals during the town hall meeting, Sen. Darwin Booher (R – Evart), who was also a panelist, said that he didn’t see them going anywhere in the near future.
Part of the controversy over public land in the past was payments in lieu of taxes (PILTs), which the DNR pays to local governments to compensate for lost private tax revenue. Some local governments complained they weren’t fully paid or paid on time in years when the legislature didn’t appropriate enough funds for the DNR to pay them all. Legislation enacted in the last few years, though, pays PILTs on Trust Fund-purchased lands from the Trust Fund, and other legislation guarantees PILT payments on tax-reverted land. Sen. Booher and Steve DeBrabander of the Department of Natural Resources confirmed that the PILTs are now paid in full and on time.
With the increased interest in natural gas development in Michigan, it’s important to determine what will happen to the state’s oil and gas royalties once the State Parks Endowment Fund reaches its cap, so that they continue to fund conservation and natural resources recreation projects. We appreciate Representatives LaFontaine and Rendon for taking the initiative to host these meetings and hear the thoughts of the people of Michigan. Please make every effort to attend one of the town halls and express your thoughts on the Trust Fund. The next meeting will be at the Thunder Bay National Marine Sanctuary in Alpena Thursday night at 6pm.

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