a private charitable trust manage and distribute assets from a natural resource damage settlement

A Private Charitable Trust

Manage and Distribute Assets from a Natural Resource Damage Settlement

HISTORY

• LARGE PUMPED STORAGE HYDROELECTRIC FACILITY

• FEDERAL LICENSE AND STATE LEASE REQUIRED MEASURES TO PROTECT FISH

LUDINGTON PUMP STORAGE FACILITY

LEGAL ISSUES

• LARGE FISH KILLS

• NATIONAL/STATE CONSERVATION GROUPS - FERC AND IN FEDERAL COURT ACTIONS

• STATE FILED IN STATE COURT

• FEDERAL GOVERNMENT AND INDIAN TRIBES CLAIMED DAMAGES

SETTLEMENT AGREEMENT

• STATE COURT CONSENT AGREEMENT- CONTINGENT ON FERC

• SEASONAL NETS - REDUCE FISH LOSSES

• PAYMENTS FOR PAST AND FUTURE FISH LOSSES

• TRUST TO PROVIDE MITIGATION

WHY A PRIVATE TRUST?

• NUMEROUS LITIGANTS/CLAIMANTS

• CASH COMPONENT LARGE

• NO PARTY TO ACTION WILLING TO VEST SOLE CONTROL TO STATE OR FEDERAL AGENCY

WHAT IS THE TRUST?

• PRIVATE CHARITABLE FOUNDATION

• COURT SETTLEMENT

• GUIDED BY BOARD AND SETTLEMENT AGREEMENT / TRUST INSTRUMENT

• GRANTS TO MITIGATE FISH LOSSES

• MANAGED BY A PRIVATE FIRM

Grand Traverse Band of Ottawa and Chippewa Indians

SCIENTIFIC ADVISORY TEAM

Little River Band of Ottawa Indians Little Traverse Bay Bands of Odawa Indians Chippewa-Ottawa Treaty Fishery Management Authority

Michigan Department of Natural Resources United States Fish and Wildlife Service Grand Traverse Band of Ottawa and Chippewa Indians Michigan United Conservation Clubs National Wildlife Federation

AND

GREAT LAKES FISHERY TRUSTBasic Structure

Lega l F inance

SAT

Adm in istra tion

M anager/Secre tary

Board o f D irectors

SOURCE OF GRANT DOLLARS

• PAST DAMAGES TO FISH - 10,000 ACRES OF LAND + 10 MILLION DOLLARS

• ANNUAL PAYMENTS FOR FISH LOSSES (APPROX. 2.5 MILLION/YR)

• PAYMENTS UNTIL 2019 (FERC LICENSE PERIOD)

• CURRENT ASSETS ~ 25 MILLION

WHO CAN GET GRANTS?

• LOCAL GOVERNMENTS

• COLLEGES AND UNIVERSITIES

• NON-PROFITS (501c3)

• STATE & FEDERAL AGENCIES

• INDIAN TRIBES

• FISHERIES RESEARCH

• REHABILITATION OF FISH POPULATIONS

• GREAT LAKES EDUCATION

• FISHERIES HABITAT RESTORATION

• FISHING ACCESS - GREAT LAKES

• SPECIAL PROJECTS

TYPES OF GRANT PROJECTS

FISHERIES RESEARCH

POPULATION RESTORATIONLake Sturgeon

Prototype Spiral Fish Ladder

EDUCATION Curriculum, Interpretive Programs,

Displays

Great Lakes Shore Fishing Access

FISHING ACCESSShore Fishing Facilities

SPECIAL PROJECTS

• SPECIAL PROJECTS– Control of Exotic

Species Introductions

– Sturgeon Research Conference

– Watershed Initiative

– Demonstration Dam Removal

SUMMARY

• $25 MILLION IN ASSETS

• $10 MILLION IN GRANTS (35 Projects)

• $4-$8 MILLION GRANTS / YEAR

• INCOME 2.5+ M/YR

GREAT LAKES FISHERY TRUSTFunctional Organization

C on trac ted L eg a l C ou n se l(A s N eed ed )

C on trac t In ves tm en t A d viso rP lan te M oran F in an c ia l

(4 T im es /Y ear)

C on trac ted A ccou n tan ts /A u d ito rsP lan te M oran , C P A s

(A n n u a l)

F in an ce C om m itteeTreasu re r +

B oard M em b ers(4 T im es /Y ear+ )

Tech n ica l P ro jec t R eview sP eer R eview ers

P eer R eview P an e l(O n ce /Y ear)

S c ien tfic A d viso ry Team(M on th ly)

L an d S p ec ia lis tsD u e D e lig en ce +

R ea l E s ta te B rokerL an d S a les to P u b lic A g en c ies

S p ec ia l C on trac ted S ervicesC on serva tion E asem en t In sp ec tion s

P u b lica tion s /P h o tog rap h yN eed s A ssessm en ts

Tru s t M an ag er/S ec re ta ryP u b lic S ec to r C on su ltan ts , In c .

A ss is tan t M an ag ers(D a ily)

B oard o f D irec to rs(4 T im es /Y ear)

RESPONSIBILITIES OF BOARD

• APPROVE SALE OF LANDS• INVEST / MANAGE ASSETS• MITIGATION GRANTS• CONTRACT FOR MANAGEMENT

SERVICES• OTHER FIDUCIARY RESPONSIBILITIES

RESPONSIBILITIES OF SAT

• ADVISE THE GLFT– Grant requests– Land matters (conservation easements)– Strategic planning

• EXERCISE SEPARATE AUTHORITY– Calculating annual fish damages– Signing-off on FERC requirements– Investigate technologies to minimize fish losses

RESPONSIBILITIES OF MANAGER

• IMPLEMENT STRATEGIC PLAN• MANAGE / SELL PROPERTIES• SOLICIT / MANAGE GRANTS• PROVIDE PUBLIC INFORMATION• RECOMMEND POLICY / PROCEDURES• RECOMMEND / IMPLEMENT

MANAGEMENT CONTROLS

WHY DOES THE TRUST WORK?

• FINANCIAL SECURITY

• CLEAR MISSION

• BENEFICIARY PARTICIPATION

• ENFORCEABLE MANDATE

• STABILITY

FINANCIAL SECURITY

• INITIAL ASSETS HIGH

• ANNUAL PAYMENTS - SOURCE OF INCOME FOR 25 YEARS

• PRUDENT INVESTMENTS - OPPORTUNITY TO INCREASE ASSETS

CLEAR MISSION

• SETTLEMENT AGREEMENT - PURPOSE

• TRUST INSTRUMENT - STRUCTURE / DECISION MAKING

• STRATEGIC PLAN SETS GOALS/OBJECTIVES

BENEFICIARY PARTICIPATION

• BENEFICIARIES - PEOPLE OF THE STATE WHO USE THE GREAT LAKES

• STAKEHOLDER ORGANIZATIONS MEMBERS OF THE BOARD / SAT

• PUBLIC INFORMED OF GLFT ACTIVITIES / FUNDING

LEGAL MANDATE

• ALL PLANTIFFS ON THE BOARD

• ALL PARTIES ON THE SAT

• SETTLEMENT ENFORCEABLE BY ANY PARTY

• INDEPENDENT OF STATE/FEDERAL GOVERNMENT

STABILITY

• GLFT IN PERPETUITY - MANAGED TO BE LIQUIDATED BY 2020

• ASSETS MANAGED FOR LONG TERM

• STAFFING BASED UPON PROGRAM SIZE

PRIVATE TRUST APPROPRIATE LTS OF CONTAMINATED SITES?

• PRIVATE SITES WITH PRPs • YES, PROVIDED

– Sufficient funding– Clear purpose / legal mandate– Local stakeholder involvement/participation

• YES, FOR PRIVATE SITES WITH CERCA FUNDING– Same caveats

PRIVATE TRUST APPROPRIATE

LTS OF CONTAMINATED SITES?• FOR DOE OR DOD SITES?

• PERHAPS, IF ISSUES CAN BE RESOLVED– Long Term Funding– Public Accountability vs Political

Independence

CONCLUSIONS

• PRIVATE TRUSTS CAN PERFORM A VARIETY OF FUNCTIONS – OFTEN MORE EFFICIENT THAN GOV.– CAN BE MORE RESPONSIVE TO

STAKEHOLDER CONCERNS– LESS SUBJECT TO PARTISAN OR

ECONOMIC CONSTRAINTS – HAS LIMITATIONS