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Memorandum - Schilling Consultant Services Disadvantages Each local government within VLAWMO would identify those parcels within the newly established watershed management tax district(s) for determining the levy amount equal for its share of the proposed WMO budget. This presumably is a one -time cost once parcels are set -up in a file. However, Ramsey County requires an administrative fee of $5.00 per parcel. Thus for example, if the local government unit had 1000 parcels in the watershed management tax district, an additional administrative fee of $5,000 would be paid to the County each year. This is a similar requirement for special assessments under typical capital improvement projects authority per M.S. Chapter 429, but typically these are one -time costs per parcel. The above procedure also incurs additional VLAWMO administrative costs to assure that each local government is levying the right amount of taxes each year to achieve the requested VLAWMO budget amount. Can a local unit of government use a stormwater utility as a funding source? Yes and a number of local government units in the metropolitan area have established stormwater utilities, including the City of Vadnais Heights under authority granted in M.S. 444.075. Advantage The stormwater utility is most equitable form of funding stormwater- related issues and in this case providing the funding contribution to a WMO. While the local government unit could take its share for the WMO budget out of its stormwater utility enterprise fund, again parcels would be double charged that are within another WMO. To remove the double charging, the local government unit would need to establish a separate stormwater utility district covering only that portion within the WMO. Disadvantage There would be an internal local government unit cost in setting up a separate parcel file for the WMO area, but this would presumably be a one time cost. However, there would need to be additional work by the local government unit every year to segregate only the WMO cost to be charged back to a given parcel. While the stormwater utility is the most equitable method, it should be noted that some parcels might not have a utility charge (e.g. open space, parcels without city sewer or water). Can a WMO seek designation as a special taxing district for future funding source? Yes, the water management organization may seek designation authority from the Minnesota Legislature as a Special Taxing District under M.S. 275.066. Besides watershed districts and the Middle Mississippi River Watershed Management Organization mentioned previously, counties are also special taxing districts. This latter county authority only applies for those counties (Carver, Dakota and Scott) in the metropolitan area that are conducting watershed planning for minor watersheds within their boundaries [M.S. 103B.245, Subd. 1(c) and 103B.253]. Essentially, a WMO acting as a special taxing district determines proposed annual expenditures for its budget. It then determines the levy amount dependent upon the tax capacity of its legal area, sets the levy amount and communicates it to the county for certification of payment. Advantage Short of the storm water utilities in each local government, a special taxing district method is the most equitable approach as WMO budgets increase as a result of additional federal and state mandated programs to improve water quality, fish and wildlife habitat. Each parcel is taxed in accordance with its location within that WMO. 01/09/2006 46 Bertha Ct., Mahtomedi, MN 55115 -2031 3