Gov. Mark Dayton is proposing an increase in state water fees that would raise millions of dollars to help the Department of Natural Resources analyze groundwater supplies at a time when the Land of 10,000 Lakes faces potential water shortages.

Water use has risen sharply in recent years, driven by urban use as well as rural industry and irrigation, and state officials say they haven't had the money to analyze how the activity is affecting thousands of underground aquifers that are critical to the state's water supply. Some systems they have studied over time have seen levels dropping year after year in trends that are unsustainable.

The higher permitting fees would increase costs for municipal suppliers, farmers and industries. For the average homeowner, the annual water bill could go up as much $1, according to state estimates, while the average farm would see its permit fee rise from $140 a year to about $500.

About 75 percent of Minnesotans rely on groundwater systems for their drinking water, and groundwater accounts for about 17 percent of the 1.3 trillion gallons of water used each year in the state.

"Considering how important these groundwater supplies are for our economy, our future economy, our ecosystems, we think we have to get on top of this issue and make sure that we're making informed choices," said Jason Moeckel, the DNR manager who oversees the water inventory and analysis unit.

The plan, if it passes the Legislature, would more than double the amount generated by fees each year that go to DNR's water management programs. Currently fees generate about $5 million a year for the programs and would increase to $11.8 million within two years.

The extra funds would allow state hydrogeologists to place additional monitors to track underground water levels.

Understanding the state's water supply is essential because the DNR is in charge of permitting usage, said Kris Sigford, water quality program director with the Minnesota Center for Environmental Advocacy.

"We have a lot of water, but we do have local shortages and we are projected to have more of them," she said.

Last year, White Bear Lake sued the DNR over the lake's diminished water level, blaming it on agency approval that allowed surrounding communities to draw more water from the aquifer below the lake.

The lake that supplies the city of Fairmont with water dropped to such low levels last fall that city officials eliminated nonessential use. In Worthington, the city's water supply was so low that wells were nearly going dry.

Moeckel said aquifers are also important to the health of lakes, rivers and streams across the state. He said these systems will be under increased pressure as the state is expected to add 1 million new people over roughly the next two decades.

"There are clearly places in the U.S. experiencing very severe water shortages, places where streams don't flow anymore," Moeckel said. "We need to get in front of this issue."