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<br />While tbe a,'J,{.'ncies '1ppellr <br /> <br />concerned rl1m all()~dl/g <br /> <br />creditS s()le~:'.Iorpr<?sen.."(llion <br /> <br />mayJnl..<;trate their goal <br /> <br />OEC-09-98 11,27 FROH,H.8.S.S. <br /> <br />i*-.~ <br />.' ...~,: <br />:. , <br /> <br />. B:Inking agrc:c:metlls with regulatory agmcies that <br />escblish bank standards for pcIformance. monitor- <br />ing. maintt.'ruInce. and long.<cnn management: <br />.... Risk allocation for mitigation faUure rhal: Is restricr- <br />ed to events wirhin a credil supplier's con""'; <br />. Flcdblc: mec!wlisms. such as higher uading ratios <br />and pcIforflWlce bonds, for allootlng liability in <br />lhe e.,-ent of failure; <br />. Rules to determinc how credits will be defined and <br />their level assessed; <br />Flaible rcgulaIoty systems and <br />avoidance of price controls to <br />ensure consisten")' In mitiga. <br />tion requirements and a wider <br />marlcet; and . <br />. Integration of mitigation bank- <br />Ing with rcgion21 and 10C2l <br />wa~hed planning initiatives. <br />Making lhese facro,", worle: 10 <br />promote banking is the biggest <br />challenge confronting r~ors <br />and bank developers alike. <br /> <br />o <br />a <br />~.~ <br />Q:\ <br />It:!>. <br />W <br />~~:tl: <br />i ~ " <br /> <br />10,970 247 8827 <br /> <br />t"H.....t:. <br /> <br />will benefil :ull~nt. functioning wetlands ~'Stems. <br />Some Corps dlstricrs are alrc:ady giving credit for wet- <br />lands p~on at a ratio of 10 lO 1 (ten .acres of <br />preservation gencrues one acre of credit). Because <br />bani: sponsors can receive credit by merely placing a <br />con$el'\'2.tion casc:ment o\'er wetlands. pL:lns WI rely <br />on preservalion should enhance the economic viability <br />of many b3nk;. <br />However. making 'cxccptloD21' circums1:1nc<s the <br />sole basis for pn:sc:rvation credits and requiring evidence <br />of a 'demoostrable cIueu:' to the I='" <br />served wetlands, for full credit, :are <br />major limirations that m:ry pose an <br />insurmountable hl.lfdle for bank <br />sponsors. While the agencies appear <br />OJDccmed th:II allOWing credits sole- <br />ly for ~t1on may frustrate their <br />goal of achiC\ing 'no net loss' of <br />wetlands. the reverse is more likdy. <br />Devdopers who are willing to pur- <br />clwc: wetlands and place conserva. <br />tion e2SeIlImtS h:lve rcmo\'e(j the <br />wctJands from a.ay threat of fu= <br />permitted (or ilkgaI) impacts. These <br />preserved wctbnds also an fit into <br />~er watershed planning su:neg!es <br />and provi&: certainty to planners, <br />regulalors. and the public. <br />ReloZionsbip to E:dsling <br />Mifigarion Requirements. The <br />Guidance aprcssly reqUires a pet'- <br />mit applicant to avoid and thm to minimize adverse <br />impacts to wetlands before being allowed to use: a <br />bank. This process. known as sequencing. is a basic <br />part of the Or::m Water ACt Section 404 progr.un. <br />Under this requirement, a bank sponsor is liIcely to <br />inquire wbether the geographic (seMce) area is faCing <br />high-gro"'-th pn:ssurcs and wh:lt the likely impactS to <br />""erlands in the W:ttenhed of the proposed bank site <br />will be. In addition, betore using a bank, an applicant <br />will h:lw: to demonstrate th.at mere is no practicable <br />oppommity f"r on-site mitigation or Wt "use of a bank <br />Is environmenWly preferable to on.site compensation_ - <br />Guidance, at 13. <br />While the sequencing process has been a basic <br />pan of the program for.,.ears. strict adherence to this <br />policy could prcvmt a banking m.arker from ever <br />emerging. If a permit applic:ult must try to avoid even <br />marginal wetlands and thm demonstrate Wt on~ite <br />miligation is not feasible. the bank sponsor is given lit- <br />tle up-front assu=ce of viable marker demand for <br />credits. A better solution would be to allow for more <br />flexibility to deviate from tile sequcnctng process. <br />especially whae the bank slle will clearly provide <br />gr<:ater environmenral benefits than on.sile wctlands. <br />Such flexibility would offer greater eeonomic incen- <br />tives and assure a better environmental result. <br /> <br />Fetkral Guidance <br /> <br />of achievi//g. "no net loss" <br /> <br />of wet/a m Is. tbe reI 'ei'Se <br /> <br />'The 1995 Guidance addresses <br />most of the conditions needed to <br />make mitigation banking work. It <br />establishes basic policies and proce- <br />d= and includes :sev<:ra1 key pro- <br />Visions Wt. if properly implemenl- <br />ed, could 'prime' the fledgling private mitigation bank. <br />ing industry. <br />fkmJl Sf'" Pu.nning. The Guidance emphasizes <br />choosing 3 site that IS ecologically suiable to support <br />aquatic functions. Banks may be sited on public and <br />private lmds, and the Guidance encourages coopera. <br />tive arnngements bctwem public and private entities. <br />With publicly owned bnds. bank sponsors avoid diffi. <br />culties associat<<l with priv.r.te land acquisition. Banks <br />may be used to compensate for wc:tWld impacts under <br />otller prog:ram5. such as Army Corps of Engineers' civU <br />works projects and Supelfund (Comprehensive <br />Environmenralllesporuc. Compensation and Uability <br />Acr, 42 V.s.c. H 9601 et seq.) d~JIIups. Mitigalion <br />banking also can be expanded to endeavors such as <br />natur.ll resource damage restoration under Superfund <br />and habitat conservation planning under the <br />Endangered Spedes ACI. 16 U.S.C. U 1531 er uq. Even <br />Stale programs. like SUte td'orestation laws, C2n be <br />combin<<l with wetlands banking. which only enlargeS <br />market opportunities. <br />Under certain circwnstaDces. the Guidance allows <br />credits for the preset"lltion of _tlands and adjacent <br />upland areas, which can filter nu<ri<:nts and sedimenl <br />from $tormwater. Be<:ause: the Guidance pn:f<:n "''Ct- <br />lands to be reslored 12ther than =t<<l. resloration <br /> <br />is more m~I!Z)'. <br /> <br />~ <br /> <br />Nli&E Summer 1998 <br />