Superior Watershed Partnership

“Expenses related to conservation easements are recorded on the accrual basis. Conservation easements are listed as an other asset on the balance sheet and are recorded at cost (if purchased) or fair value at the time of acquisition. The financial statement footnote on conservation easement: conservation easements are comprised of listed rights and/or restrictions over the owned property that are conveyed by a property owner to the partnership, almost always in perpetuity, to protect the owned property as a significant natural area, as defined in federal tax regulations. These intangible assets may be sold or transferred to others so long as the assignee agrees to carry out, in perpetuity, the conservation purposes intended by the original grantor. Conservation easements are recorded at cost if purchased or at fair value at the date of acquisition if all or part of the easement was received as a donation. Fair value is generally determined at the time of acquisition and is not subsequently adjusted.”

“During 2015, the government of the united states of america transferred ownership of the historic stannard rock lighthouse to the partnership under the national historic lighthouse preservation act of 2000. The partnership plans to expand great lakes climate research at the lighthouse and involve the great lakes conservation corps in historic renovation projects. Fasb asc 958-360-20 defines collections as works of art, historical treasures, or similar assets that are: held for exhibition to the public, for educational purposes, or for research in furtherance of public service and not financial gain; protected, cared for, and preserved; and subject to a policy requiring any proceeds from the sale of collection items to be reinvested in other collection items. The collection items may be capitalized in one of three ways: capitalize all collection items, capitalize no collection items, or capitalize all collection items acquired on a prospective basis. The partnership has elected to not capitalize this collection item.”

“Located on a shallow, rocky shoal in lake superior over 40 miles due north of marquette, michigan, the stannard rock lighthouse (collection) is considered the most remote lighthouse in north america. The organization plans to expand great lakes climate research at the lighthouse and involve the great lakes conservation corps in historic renovation projects.”

“The partnership is exempt from federal income taxes under section 501(c)(3) of the internal revenue code and, therefore, has made no provision for federal income taxes in the accompanying financial statements. The partnership files form 990 with the internal revenue service. The partnership believes that its income tax filing positions will be sustained upon examination and does not anticipate any adjustments that would result in a material adverse effect on the partnership's financial conditions, results of operations, or cash flows.”