Executive Summary
Introduction
The PEER Committee authorized this review of the use of Tidelands Funds in response to legislative concerns over the use of such funds.
Background
Public trust tidelands include discrete bodies of water (e.g., separate streams and bayous) and extend to approximately three miles south of the Barrier Islands. Any individual or organization building on or utilizing these tidelands must enter into a lease agreement with the state. The Secretary of State collects these tidelands lease revenues and deposits them into the Public Trust Tidelands Fund. At the close of each fiscal year the Secretary of State recovers any administrative costs incurred in his office’s administering of the fund. Any remaining funds derived from lease rentals are disbursed pro rata to local taxing authorities for the replacement of all lost ad valorem taxes, with the remaining funds disbursed to the Commission on Marine Resources in accordance with legislative appropriations.
MISS. CODE ANN. Section 49-15-301 (1972) provides for the Mississippi Commission on Marine Resources to be the sole administrator of the Public Trust Tidelands Act. The commission’s fifteen-year plan proposes that 50% of Tidelands Funds be dedicated to Public Access projects and 50% be dedicated to Management projects. Public Access projects involve the construction and acquisition of coastal resources (i.e., boat ramps, breakwaters, marinas, harbor repairs, piers), while Tidelands Management projects involve the conservation, reclamation, education, enhancement, preservation, and acquisition of marine-related coastal resources. The commission annually provides the Legislature with its recommended funding distribution plan for Management projects, as well as a list of applicants for Public Access projects.
In appropriating funds to DMR, the Legislature designates projects to be funded with Tidelands Funds in accordance with MISS. CODE ANN. Section 29-15-9. Upon receiving the Tidelands Funds from the Secretary of State in September or October, DMR enters into grant agreements with each local governing authority or private entity designated by the Legislature and distributes the appropriated amount of funds to each.
Overview
MISS. CODE ANN. Section 29-15-3 (1972) declares the public policy of the state "to favor the preservation of the natural state of the public trust tidelands and their ecosystems and to prevent the despoliation and destruction of them, except where a specific alteration of specific public trust tidelands would serve a higher public interest in compliance with the public purposes of the public trust in which such tidelands are held."
The Secretary of State serves as administrator of the state’s public trust lands, overseeing lease management of Public Trust Tidelands. The Department of Marine Resources is statutorily charged with tidelands management, which encompasses protection of the tidelands environment and administration of the Tidelands Act.
The Office of the Secretary of State and the Department of Marine Resources have collected and distributed funds in compliance with statutory provisions and legislative appropriations. However, local governing authorities and entities receiving FY 1998 appropriations did not comply with DMR grant agreement provisions for ninety-four percent of funded projects, which decreases the accountability for Tidelands Funds.
All projects which receive Tidelands Funds are subject to legislative line-item appropriations, but are not subject to an analytical review to determine their merit, need, or compliance with state law. This may not insure that tidelands resources are protected, preserved, or enhanced or that funds are expended for the advancement of the legislatively stated objectives of Tidelands Funds as set forth in MISS. CODE ANN. Section 29-15-9 (1972).
Tidelands Revenues and Expenditures
Collection of Tidelands Revenues
The Office of the Secretary of State has collected and distributed Tidelands Funds to the Department of Marine Resources in compliance with MISS. CODE ANN. Section 29-15-9 (1972).
The Office of Secretary of State collected $16,839,409 in tidelands revenues since enactment of the Tidelands Act in 1989. Of this $16,839,409, the office has retained $1,398,814, or eight percent (8%), to cover its administrative costs. The Office of Secretary of State has distributed the remaining $15,440,595, or ninety-two percent (92%), to the Commission on Marine Resources.
Distribution and Expenditure of Tidelands Revenues
The Department of Marine Resources has distributed Tidelands Funds in compliance with legislative appropriations.
Since the implementation of line-item budgeting in DMR’s annual appropriation beginning in FY 1996, the Legislature has appropriated $14,500,000 to the agency for tidelands projects. In accordance with its appropriation authority, DMR has distributed the specified amount of Tidelands Funds to each local governing or private entity provided for in DMR’s appropriation. DMR has distributed $9,175,000 of these funds to local governing bodies and private entities for Public Access projects and $5,325,000 for Management projects.
Local Entities’ Compliance
Local governing authorities and entities receiving FY 1998 appropriations did not comply with DMR grant agreement provisions for ninety-four percent of funded projects.
DMR enters into a grant agreement with each local governing authority or entity designated by the Legislature to receive Tidelands Funds for Public Access or Management projects. PEER reviewed the thirty-one FY 1998 projects to determine if local entities’ compliance with DMR grant agreement provisions.
One hundred percent of local governing authorities or private entities which received FY 1998 Tidelands Funds for Public Access projects failed to comply with DMR grant agreement provisions. Only two of the seventeen local governing authorities or private entities which received FY 1998 Tidelands Funds for Management projects complied with DMR grant agreement provisions. Local governing authorities’ and private entities’ failure to comply with DMR grant agreement provisions decreases the entities’ accountability for Tidelands Funds, and, thus, the state’s management of such funds.
Legislative Appropriations
All projects which receive Tidelands Funds are subject to line-item appropriations, but are not subject to formal analytical review.
All projects which receive Tidelands Funds are subject to line-item appropriations, but are not subject to an analytical review to determine their merit, need, or compliance with state law. DMR does evaluate proposals for Management projects and provides a recommended distribution of funding to the Legislature, but only provides the Legislature with a list of local governing authorities and private entities which have submitted applications for Public Access projects. The Legislature has appropriated funds to entities which have applied for such funds and to entities which have not submitted project applications. Further, no direct link has existed between entities’ complying with DMR grant agreement provisions and the Legislature’s appropriating funds to new projects.
Recommendations
Should other Management and Public Access projects which are not included on DMR’s comprehensive list be considered for funding during the appropriation process, the Legislature should refer such projects to DMR. The department should evaluate the merits of such projects in accordance with the same evaluation criteria used to compile the list initially submitted to the Legislature and report the results of the evaluation to the Legislature prior to the conclusion of the legislative session. The Legislature should strive to ensure that all projects receiving Tidelands Funds have been objectively and equally evaluated and are in compliance with statutory provisions for the use of such funds.
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