The $200 million state grant has been a very significant inflection point for how the Four Lakes Special Assessment District will be managed as well as the Four Lakes restoration project going forward. We have received questions related to the new assessment model since the amount of the Capital Assessment is now common for all lake property owners, similar to the Operations Assessment.
Total Approach to Funding Given the $200 Million State Grant
Well over a year ago, with no significant government funding in the forecast, FLTF was able to qualify for a United States Department of Agriculture (USDA) loan, creating a financial model where the properties of each lake would be assessed separately for the construction restoration costs of their dam. This was due to the capacity limitation of the USDA funding program in any one year and if the project could be financed as one project. USDA requirements needed to have all four dams' engineering completed prior to funding all four dams, which would have delayed Secord and Smallwood dams’ schedules.
In December of 2021, FLTF set the following priorities, as there became a possibility of a significant State of Michigan grant of over $100 million, which occurred with the $200 million appropriation that was approved on March 30, 2022.
Fund all property owners on all the lakes to the point where construction can begin.
Apply grants to get the assessment to the lowest common capital assessment number based on benefit, with no property owners paying more than they would if they financed on their own.
FLTF will do everything that can safely be done to remain under the current project estimate of $250 million, given there is uncertainty in the project and the markets.
Importantly, the State has provided $200 million to the Four Lakes Task Force for the Special Assessment District under Part 307, to make the lakes affordable for all the Four Lakes communities.
FINANCING AND MANAGING AS ONE SYSTEM IS LOWER COST TO THE PROPERTY OWNER THAN LAKE-BY-LAKE FINANCING WITHOUT THE STATE GRANT
By managing and financing as one project with a common assessment for all the SAD, EVERY PROPERTY OWNER IN THE FOUR LAKES SPECIAL ASSESSMENT DISTRICT WILL HAVE A LOWER COST than if the repairs and restorations were funded with lake-by-lake financing without state grants.
Capital Assessent Timing Is Over 2 Years Away
To reiterate what was discussed at last week's webinar: if additional funding is needed beyond the $200 million State grant, it will not be until towards the end of all the Four Lakes Restoration projects, and a Capital Assessment would occur in 2024/2025. This has uncertainty in the numbers. But we will stay focused on project cost management, and these numbers do not include any future grants.
These lakes would never have been restored had the counties chosen not to rescue them from their owner and worked with the Four Lakes Task Force to recover and restore these dams. It’s important to understand the dams are owned by the counties, and the state grants were to lower the burden on all the lake communities to make it affordable. The methodology is intended to give each of the Four Lakes properties in the Four Lakes Special Assessment District an equivalent assessment allocation of cost based on the properties’ equivalent benefits. This is created by two simple facts: the county acquired the lakes, and the state has funded 80% of their restoration.
Please mark your calendar for important dates related to the Four Lakes Special Assessment.
April 11, 2022, at 2 p.m. | FLTF board meeting | Secord Township Hall, 1507 Secord Dam Rd, Gladwin, MI 48624
Topics will include a review of the 2022 budget and its financing, and approval of the financial plan that was reviewed at the April 6 webinar. There will be a public comment period.
April 19, 2022, 9 a.m. - 4 p.m. | Preliminary Day of Review | Jerome Township Hall
April 20, 2022, 4:30 p.m. - 9:30 p.m. | Preliminary Day of Review | Secord Township Hall
FLTF encourages you to attend and review your property with the FLTF team working on the SAD. The assessment methodology will be applied using the property tax records as provided to FLTF from each county and will be formally adopted at the Four Lakes Special Assessment Hearing.
June 15, 2022 | Deadline to Combine Parcels
Mail or email a letter to FLTF from your township assessor that indicates a parcel combination is in progress and will be in effect in 2023.
June 2022 (Date TBD) | Special Assessment Hearing
Property owners can appeal their portion of the Operations Assessent for 2022-2004. After this meeting, the counties will review the rolls and assessment for approval.