Extension Lakes

Principal Differences Between Incorporated Lake Associations, Qualified Lake Associations, and Public Inland Lake Protection and Rehabilitation Districts

	Incorporated Lake Association ​	Qualified (incorp.) Lake Association	Public Inland Lake Protection and Rehabilitation District
STATUTORY AUTHORITY	Ch. 181, Wis Stats.	Ch. 281,181 Wis Stats.	Ch. 33 Wis Stats.
FORMATION	1. File Articles of Incorporation. 2. Draft bylaws	1. File Articles of Incorporation. 2. Draft bylaws with specific statutory criteria set forth.	1. Landowner petition to county or town board. 2. Resolution of city council or village board. 3. Conversion of a town sanitary district.
PRINCIPAL MEANS OF FINANCING ACTIVITIES	membership dues	membership dues state grants/other grants	property tax levy state grants/other grants
BOUNDARIES	​ Assoc. should designate one or more lakes. Specific boundaries are not required.	​ Assoc. should designate one or more lakes. Specific boundaries are not required.	Boundaries may include part of a lake, entire lake, or more than one lake. Boundaries are strictly defined.
POWERS General Management Powers (pursuant to statutory guidelines) Not an exhaustive list of powers *with permit from DNR	​has power to: acquire property, borrow money, invest money, contract for aquatic plant removal, purchase sensitive areas, improve fish habitat*, stock fish*, and maintain lake access.	Powers are the same as an incorporated lake assoc. (s. 181.04 Stats.).	has power to: sue and be sued, make contracts, take out loans, levy taxes, special charges, accept grants, state aid, monitor water quality, survey lake users, harvest or treat aquatic plants and dredge, adopt boating ordinances (s. 30.22 Stats.)
ADDITIONAL POWERS Public inland lake districts have authority to assume powers of sanitary districts. *Districts may not exercise these powers within territory of existing sanitary district (s. 33.22(2m), s. 60.77 Stats.)			has authority to: require the inspection of private sewage systems, fix and collect charges for solid waste collection, disposal, sewage service and water service. enact ordinances to implement powers. provide chemical or mechanical treatment of waters to treat swimmers itch, algae.
GOVERNANCE	Board of directors and association membership	Board of directors and association membership	Board of commissioners and electors at annual meeting

Some Advantages and Disadvantages of Unincorporated Lake Associations, Qualified Lake Associations (Incorporated) and Public Inland Lake Protection and Rehabilitation Districts

General Principles:

Unincorporated Lake Association:

Advantages:

• Informality of operations. No legal guidelines, no formal organizational requirements to govern operations.

Disadvantages:

• Cannot hold title to real property. Setting up an interest-bearing accuont may be difficult.
• Inability to shelter participants’ individual assets from claims for damages arising out of organization’s activities.
• Not eligible for lake planning and protection grants.

Unincorporated status may be appropriate under the following circumstances:

• Informality is desirable.
• Small membership
• Minimal activities
• Small budget
• Little danger of tort liability
• No need to own property or hold a bank account.

Qualified Lake Association:

Advantages

• Legal certainty. Nonstock corporations are governed by a well developed statutory framework (ch. 181 Wis. Stats).
• Simplified business activities. An incorporated lake association can engage in a greater amount of lake protection activities by virtue of its ability to hold a bank account, make contracts and borrow money.
• Qualified lake associations are eligible for lake planning and protection grants.
• Limited liability. Members, officers and directors can be sheltered from personal liability.
• Eligible for lake planning and protection grants.

Disadvantages

• Slightly more complex organizational form and more formality in operations.
• No authority over shoreland development or lake use.

Qualified lake associations may be appropriate when the following circumstances exist:

• Lake organization expects to play active role in lake protection.
• Larger membership.
• Legal certainty desirable.
• Long-term existence desirable.
• Activities create possible exposure to liability.

Lake Protection and Rehabilitation Districts:

Advantages:

• Because the lake district has the ability to tax property owners within its boundaries, it is generally in a better financial position to undertake various lake management activities.
• The lake district has all the powers of a body corporate.
• The lake district may regulate use of the lake through the adoption of boating ordinances if the authority is delegated from the appropriate units of government.
• The lake district may adopt certain powers of sanitary districts.
• Lake protection and rehabilitation districts are eligible to apply for lake planning and protection grants.
• Limited liability for officers and members.

Disadvantages:

• A more complex organizational structure requires a higher level of maintenance.
• All property owners within the district are subject to the district�s property tax levy.
• No control over shoreline development.

Lake district status may be appropriate when the following circumstances exist:

• Lake organization expects to play active role in lake protection.
• Legal certainty is desirable.
• Long term planning for lake is anticipated.

References:

A Guide for Wisconsin Nonprofit Organizations, State Bar of Wisconsin (1992).

Volunteer organizations have been a part of the lake scene in Wisconsin for over a hundred years. By the turn of the 19th century, declining water quality and other human impacts on lakes were becoming apparent. People on Lake Geneva and the Lauderdale Lakes formed the first lake organizations in 1898 and 1902, respectively, to deal with the issues. The number of voluntary organizations concerned with the health of lakes continued to grow slowly over the years, but the issues facing lakes grew faster.

A growing sense of urgency caused more and more lake area residents to band together. They formed organizations aimed at finding solutions, but in some cases their success was limited by their lack of authority to deal with the issues at hand. Part of the problem was that, metaphorically speaking, lakes are round and governments are square. Some of the biggest challenges with lake management are that lakes and lake-related issues do not fit neatly within the boundaries of local governments and governments often have other competing priorities.

Before 1974, Wisconsin did not have local public institutions designed to manage lakes. The first attempts at publicly administered lake management took place in the early 1930s. Several Wisconsin lake communities formed sanitary districts to focus on lake problems. These governmental bodies could be established with boundaries following the shape of the lake. As government bodies, they could levy taxes to spread the cost of operations equitably. However, there were shortcomings with sanitary districts. Their primary purpose was to provide sewer and water service for urbanizing areas, but in those early days they lacked the comprehensive power needed to address the complex problems involved in lake management.

In 1959, many of the lake associations in the state joined together to form the Wisconsin Federation of Lakes. Lake water quality was still declining and by the mid-1960s our nation saw environmental deterioration of lakes and rivers becoming commonplace. Polluted water caused algae blooms, excessive aquatic plant growth, and in some cases toxic contamination. In 1972, the Cuyahoga River in Ohio actually caught fire not once, but several times. Many lakes and rivers were unfit for swimming or fishing. The 1972 Federal Clean Water Act and other environmental laws set the stage for major cleanups of many sources of pollution. But these laws did little to address the unique challenges of managing inland lakes.

In response to a growing awareness of the harmful effects of pollution and the decline of the quality of Wisconsin lakes, a major six-year demonstration project was conducted by the University of Wisconsin and the Wisconsin Department of Natural Resources (WDNR). In response to the project’s recommendations, the Legislature enacted a 1974 law aimed at solving lake issues. Chapter 33 of the Wisconsin Statutes was created to provide for the formation of a new kind of lake management organization – the public inland lake protection and rehabilitation district. Since that time, over 250 lake districts have been formed in Wisconsin. A statewide organization representing lake districts, the Wisconsin Association of Lake Districts, was formed in 1981.

The 1974 law also established a state educational assistance and cost-sharing program for lake management organizations. Over the years, program details and funding levels have changed, but this state/local partnership has continued to mature. In the 1980s, voluntary lake associations meeting certain standards (qualified lake associations) were added to the list of eligible lake grant participants. Today there are over 500 lake associations in Wisconsin.

In 1992, the Wisconsin Association of Lakes (WAL), now known as Wisconsin Lakes, was created through the merger of the Wisconsin Federation of Lakes and the Wisconsin Association of Lake Districts. This statewide non-profit, in partnership with the Extension Lakes Program and the Wisconsin Department of Natural Resources, calling themselves the Wisconsin Lakes Partnership, has continued to follow the mission of preserving and protecting our legacy of lakes to this day. Since the late 1990s, Wisconsin DNR has also provided similar funding to cost-share river planning and management. The specific DNR office involved is now the Lakes and Rivers Section, and in light of the connections between streams, rivers, lakes and watersheds, the partnership added “rivers” to its name in the 2020s.​​

People formed the first lake organization in Wisconsin about 1895​.
Today, over ​500 lake associations and over 25​0 lake districts are working for (and in) Wisconsin’s lakes.​