Anderson: Some state legislators would again dip into trust fund for outdoors

Irony reared its head Monday when Minnesota Lottery officials issued a brag sheet extolling the many good deeds citizens have funded while trying to hit the jackpot. Since 1990, the notice said, the lottery has raised more than $3 billion, with about $1.2 billion assigned to protect the state's environment.

You might recall the lottery was first approved in Minnesota on Nov. 8, 1988, as a constitutional amendment favored by 58% of voters. It's no accident the lottery's logo is a loon, because the public was told the state's entry into the gaming business would help protect their cherished lakes, rivers, forests, fields and wildlife.

Yet if that's the case, why did Monday's announcement also state that a considerably larger sum, about $1.7 billion of lottery money, has ended up in the state's general fund?

In part, that fund's lopsided winnings can be traced to a sleight of hand the Legislature pulled not long after voters approved the lottery — a switcheroo that resulted in a larger share of betting proceeds funding the state's ongoing operations than was originally presented to voters.

Now the public is again at risk of being shortchanged, because the Republican-controlled Senate is attempting to circumvent the project- recommendation processes of the Legislative-Citizen Commission on Minnesota Resources (LCCMR), a 17-member group of legislators and citizens that advises the Legislature on expenditures from the lottery's Environment and Natural Resources Trust Fund.

Recall last year that the Republican-controlled Legislature approved in its last hours and without public input a bill allowing the state to use about $8 million annually in lottery money from the Environment and Natural Resources Trust Fund to pay interest on appropriations bonds to fund wastewater treatment plants and other infrastructure projects.

Over the bonds' 20-year lifetime, the state would pay $66 million in interest from the trust fund.

Much-less-expensive general obligation bonds typically fund projects such as these. But Republicans wanted to stay within their comparatively tight budget targets while also delivering projects they — and most everyone — deemed necessary, and one way to do it was to rob the trust fund.

Gov. Mark Dayton ultimately signed the bill, but under protest, and a consortium of eight conservation groups sued the state, saying that paying for infrastructure projects from the trust fund violated both the voters' trust and the state Constitution.

All of which seemed to be smoothed over last month when legislative leaders and Gov. Tim Walz signed into law a $98 million general-obligation bonding bill that replaced the bonds that would have been paid from the Environment and Natural Resources Trust Fund.

To naive outsiders like me, the hugfest that celebrated the law's enactment signaled that legislators had seen the error of their ways and, for fear of being sued over their misuse of lottery funds, would not again attempt to circumvent the (1) will of the people; (2) the project-evaluation-and-recommendation processes of the LCCMR; and (3) what many observers believe are specific legislative and constitutional prohibitions against using lottery grants for wastewater treatment plants.

As I say, I was naive. Because Sen. Torrey Westrom, R-Elbow Lake, an LCCMR member, told me this week that he and certain other legislators, including some DFLers, agreed to the bonding swap only to avoid long funding delays, adding that in his opinion the law allows for lottery-funded grants to be used for wastewater plants and other infrastructure.

Which is why this session he included about $10 million of the $61 million the Senate trust fund bill spends to pay for wastewater treatment plants. Moreover, another Senate Republican bill eliminates 18 LCCMR-recommended projects and replaces them, in part, with $10 million in funding for state parks and trails operations and maintenance.

The comparable DFL-controlled House bill, meanwhile, largely funds projects approved by the LCCMR, while also providing $6.5 million in loans (not grants) for water treatment plants.

"The lottery will be up for a vote again in 2025," said Rep. Rick Hansen, DFL-South St. Paul, chairman of the House Environment and Natural Resources Finance Division. "Voters need to be confident the money is being spent the way they were told it would be spent."

Sen. Bill Ingebrigtsen, R-Alexandria, chairman of the Environment and Natural Resources Finance Committee, said he and his Republican colleagues are constrained by tight budget targets that in coming weeks likely will be revised when the governor and legislative leaders meet.

"Nothing's carved in stone yet," he said of the Senate's bills. "But the money for all these projects has to come from somewhere."

Hansen, meanwhile, thinks some Senate Republicans wouldn't mind if the whole mess ended up in court.

"There's a faction there," said Hansen, "I think that's saying, 'So sue us.' "

Dennis Anderson • 612-673-4424