DEPARTMENT: Parks
FILE TYPE: Consent Action
TITLE
title
Authorization To Use Environmental Legacy Fund Budgeted Match For Acquisitions Ineligible For Outdoor Heritage Fund Grants And Amend 2026 Environmental Legacy Fund, General Fund, and Land Conservation Capital Improvement Program Budgets
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RESOLUTION
body
WHEREAS, by Resolution No. 18-518 (October 9, 2018), the Dakota County Board of Commissioners authorized the Physical Development Director to execute the 2018 Minnesota Legislature (ML) Outdoor Heritage Fund (OHF) Grant Agreement [ML 2018, Ch. 208, Art. 1, Sec. 2, subd 5(f) Dakota County Habitat Protection/Restoration Phase VI] with the Minnesota Department of Natural Resources (DNR) for implementing riparian and lakeshore protection and restoration/enhancement projects in Dakota County; and
WHEREAS, by Resolution No. 22-334 (August 23, 2022), the Dakota County Board of Commissioners authorized the Physical Development Director to execute the 2022 ML OHF Grant Agreement [ML 2022, Ch. 77, Art. 1, Sec. 2, subd.5(a) Dakota County Habitat Protection/Restoration Phase VIII] with the DNR for habitat protection and restoration/enhancement projects in Dakota County; and
WHEREAS, by Resolution No. 20-028 (January 7, 2020), the Dakota County Board of Commissioners approved the acquisition of the permanent 13.7-acre natural area conservation easement (NA easement) on the Main Street property in Greenvale Township using a combination of OHF ML 2018 and County match funds; and
WHEREAS, by Resolution No. 20-030 (January 7, 2020), the Dakota County Board of Commissioners approved the acquisition of the permanent 10.3-acre NA easement on the Wasner property in Greenvale Township using a combination of OHF ML 2018 and County match funds; and
WHEREAS, by Resolution No. 20-632 (December 15, 2020), the Dakota County Board of Commissioners approved the fee title acquisition of the 7.3-acre Wallin property in the City of Hastings using a combination of OHF ML 2018 and County match funds; and
WHEREAS, by Resolution No. 21-319 (June 22, 2021), the Dakota County Board of Commissioners approved the fee title acquisition of the 42.6-acre Adelmann property in the City of Farmington using a combination of OHF ML 2018 and County match funds; and
WHEREAS, by Resolution No. 21-608 (December 14, 2021), the Dakota County Board of Commissioners approved the acquisition of the permanent 2.82-acre NA easement on the Pylkas property in the City of Inver Grove Heights using a combination of OHF ML 2018 and County match funds; and
WHEREAS, by Resolution No. 23-213 (May 23, 2023), the County Board of Commissioners approved the fee title acquisition of the 29.3-acre Peterson-North property in the City of Farmington using a combination of OHF ML 2022 and County match funds; and
WHEREAS, by Resolution No. 23-214 (May 23, 2023), the County Board of Commissioners approved the fee title acquisition of the 57.2-acre Peterson-South property in Eureka Township using a combination of OHF ML 2022 and County match funds; and
WHEREAS, the County match funding that was to be provided, per the resolutions associated with each of these acquisitions, originated from the Environmental Legacy Fund; and
WHEREAS, following the closing of each acquisition, Dakota County sought reimbursements from the DNR for costs incurred during the acquisition process using the applicable OHF grant; and
WHEREAS, each of these seven acquisitions was determined to be disallowed costs by the DNR and thus ineligible for grant fund reimbursement; and
WHEREAS, the County seeks to retroactively reconcile the discrepancy in the planned funding sources and the actual funding sources for each of these seven acquisitions.
NOW, THEREFORE BE IT RESOLVED, That the Dakota County Board of Commissioners authorizes that total funding in the amount of $867,498 will be provided by the Environmental Legacy Fund (ELF) to cover the cost of the Main Street, Wasner, Wallin, Adelmann, and Pylkas acquisitions; and
BE IT FURTHER RESOLVED, That the 2026 Environmental Legacy Fund Budget is hereby amended as follows:
Other Financing Use
Transfer to General Fund $867,498
Total Other Financing Use $867,498
Revenue
Use of ELF Fund Balance $867,498
Total Revenue $867,498
BE IT FURTHER RESOLVED, That the 2026 General Fund Budget is hereby amended as follows:
Other Financing Sources
Transfer In from ELF $867,498
Other Financing Sources $867,498
Revenue
Use of General Fund Balance ($867,498)
Total Revenue ($867,498)
BE IT FURTHER RESOLVED, That the 2026 Land Conservation Capital Improvement Program Department Budget is hereby amended as follows:
Revenue
Use of Fund Balance-General Fund ($867,498)
Use of Fund Balance-ELF $867,498
Total Revenue $0
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BACKGROUND
Dakota County’s Land Conservation Program has historically leveraged state grant opportunities to fund land protection and restoration. One of the County’s strongest funding partners in these efforts has been the Lessard-Sams Outdoor Heritage Council (LSOHC) which oversees and provides annual funding recommendations to the legislature from the Outdoor Heritage Fund (OHF). Funds awarded by the LSOHC are managed as a pass-through grant with administrative assistance and oversight provided by the Minnesota Department of Natural Resources (DNR). Both the LSOHC and the DNR provide grantees with program guidelines, including Land Acquisition Reporting Procedures, that detail processes that must be adhered to under each grant award.
In the case of the seven aforementioned conservation easement and fee title acquisitions, reimbursement for acquisition costs was disallowed by the DNR for failure to meet their program requirements. Each acquisition was denied for reimbursement independently and for its own reason(s), which, in these cases, included failure to produce required documentation, acquiring outside of the grant term, acquiring a parcel that was not pre-approved by the grantor and failure to meet appraisal and environmental assessment requirements. Reimbursement for approved grant activities and allowable expenses have been typically sought after the service or product has been paid for internally. Since reimbursement for these acquisitions was sought after the fact, each acquisition had already been paid for using internal funds. The denied reimbursement requests represent missing revenue that can no longer be used to cover expenses tied to each of these acquisitions.
Dakota County staff have since implemented several process improvements both internally and externally to ensure grant funded reimbursements for land acquisitions are approved prior to closing. These improvements include submitting required pre-closing documentation to DNR grants staff thirty days ahead of closing, allowing additional time for administrative review and corrective actions, if needed. Coordination between County Parks, Real Estate and Finance staff has also improved through more consistent planning meetings, refined file organization and utilization of internal reference guides to ensure alignment with grant program requirements. The implementation of these practices allowed staff to successfully acquire a new conservation easement in Greenvale Township on June 30, 2026, using available ML22 funds. These grant funds were received ahead of closing, thereby guaranteeing that grant requirements had been met while also lessen the short-term financial burden on the County. Requesting that grant funds be issued in advance for acquisitions will be yet another mechanism to maintain accountability while protecting the County’s programs and financial interests.
The Dakota County Board of Commissioners authorized each of these acquisitions with the understanding that primarily grants funds would be used in tandem with a smaller contribution of local match funds coming out of the Environmental Legacy Fund (ELF). Factoring in the approved levels of match, the remaining balance of the acquisition costs of the seven conservation acquisitions is:
|
Acquisition Name |
Budgeted Match Expense |
Budgeted OHF Grant Expense |
Budgeted Combined Acquisition Expense |
Actual Acquisition Expense |
Additional ELF Match Requested |
Approval For Use Of Existing ELF Match |
|
Main Street (ML18) |
$3,930 |
$15,720 |
$19,650 |
$20,162 |
($16,232) |
|
|
Wasner (ML18) |
$3,216 |
$12,864 |
$16,080 |
$15,820 |
($12,604) |
|
|
Wallin (ML18) |
$144,750 |
$434,250 |
$579,000 |
$593,731 |
($448,981) |
|
|
Adelmann (ML18) |
$86,900 |
$352,500 |
$439,400 |
$439,977 |
($353,077) |
|
|
Pylkas (ML18) |
$20,750 |
$62,250 |
$83,000 |
$81,670 |
($36,604) |
($24,316) |
|
Peterson-North (ML22) |
$148,733 |
$203,122 |
$351,855 |
$185,727 |
|
($36,994) |
|
Peterson-South (ML22) |
$19,258 |
$298,372 |
$317,630 |
$339,283 |
|
($320,025) |
|
Totals |
$427,537 |
$1,379,078 |
$1,806,615 |
$1,676,370 |
($867,498) |
($381,335) |
RECOMMENDATION
recommendation
There is adequate existing funding from the ML22 county match funds to cover the additional acquisition funds needed for ML22 projects, Peterson-North and Peterson-South. However, there is not adequate ML18 county match funding to cover all the additional acquisition costs for the five ML18 acquisitions. County staff recommends that an additional $867,498 be provided by ELF to pay the balance of the acquisition costs for the five ML18 acquisitions addressed in this Request for Board Action.
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FINANCIAL AND STAFFING IMPACTS
A budget amendment to transfer ELF to General Fund is needed in the amount of $867,498. Current and future workplans and staff time will not be impacted by this action.
PREVIOUS BOARD ACTION
23-213; 5/23/23
23-214; 5/23/23
22-334; 8/23/22
21-608; 12/14/21
21-319; 6/22/21
20-632; 12/15/20
20-030; 1/7/20
20-028; 1/7/20
18-518; 10/9/18
ATTACHMENTS
None
CONTACT
Department Director: Niki Geisler
Author: Alexander Scurto