The Competent Authority shall, in order to handle water conservancy activities and fund the operations of irrigation management organizations as mentioned in Article 18, establish the Farmland Water Conservancy Activities Operational Fund, whose funding sources shall be as follows:
1. Appropriations of the governmental budget.
2. Income from fees collected for applications in farmland water conservancy facilities areas based on Paragraph 1 of Article 12, Paragraph 1 of Article 13, and Paragraph 2 of Article 14, as well as fees collected from users based on the provisions of Article 25.
3. Rental and interest income.
4. Income from asset disposal or revenue from assets activation.
5. Other income.
The uses of the Operational Fund as mentioned in the preceding Paragraph shall be as follows:
1. Expenditures for the construction, improvement, maintenance, or management of farmland water conservancy activities.
2. Expenditures for matters related to prevention of disasters and post-disaster response measures for farmland water conservancy activities.
3. Personnel costs for staff for farmland water conservancy activities.
4. Expenditures for matters related to the rental or acquisition of land needed for the use of farmland water conservancy facilities belonging originally to an Irrigation Association.
5. Other expenditures related to farmland water conservancy activities.
The Farmland Water Conservancy Activities Operational Fund as mentioned in Paragraph 1 of this Article shall set up individual accounts for each farmland water conservancy activity.
The income listed in the Sub-Paragraphs of Paragraph 1 of this Article shall be exempted from the Business Tax.

Following the organizational reform of the Irrigation Associations, their assets and debts shall be summed up and taken over by the state, and incorporated into and managed by the Farmland Water Conservancy Activities Operational Fund set up in accordance with Paragraph 1 of the preceding Article.
When assets are transferred to the Farmland Water Conservancy Activities Operational Fund for management as mentioned in the preceding Paragraph, the transfer shall be exempt from all taxes.
To finance the costs of farmland water conservancy activities, assets taken over by the state as mentioned in Paragraph 1 of this Article shall be handled in a manner to activate revenue in their use, revenues, or disposition, and are not subject to the restrictions in Article 28, Chapter 4, or Chapter 6 of the National Property Act; regulations governing the assets to be activated, fee, and other relevant matters shall be stipulated by the Competent Authority. Any agency which makes receives appropriations according to law shall arrange appropriations with charge.
Assets as mentioned in Paragraph 1 of this Article shall not be subject to the limitations related to uncompensated appropriation or substitution of public land in the proviso in Paragraph 1 of Article 43 of the Land Expropriation Act, in Paragraph 1 of Article 60, of the Equalization of Land Rights Act, or in Paragraph 2 of Article 11 of the Rural Community Land Readjustment Act.
After organizational reform of Irrigation Associations, in cases where as a result of reorganization of land ownership it is discovered that land originally belonging to an Irrigation Association as registered by the land administration of the relevant municipality, county, or city has the notation “state-owned” in the column for the owner, the managing organization shall be a subordinate agency designated by the Competent Authority.

To meet the needs of maintaining the operations of farmland water conservancy facilities, the Competent Authority shall appropriate funding in the annual budget to the Farmland Water Conservancy Activities Operational Fund set up on the basis of Paragraph 1 of Article 22 of this Act.
The standards for calculating the yearly appropriation mentioned in the preceding Paragraph shall be stipulated by the Competent Authority.

In cases where the topography requires the Competent Authority to supply irrigation water through pressurization, the Competent Authority may collect additional fees related to the operation and maintenance of facilities.
The fee-charging standards as mentioned in the previous Paragraph shall be stipulated by the Competent Authority.

The Farmland Water Conservancy Activities Operational Fund shall each year appropriate part of the proceeds from asset disposal for the rental or acquisition of usage rights of land that shall continue to be used as before as stipulated in Paragraph 1 of Article 11 of this Act.