Wetland Mitigation Banking:
Wetland Mitigation banking is "wetlands restoration, creation, enhancement, and in exceptional circumstances, preservation undertaken expressly for the purpose of compensating for unavoidable wetland losses in advance of development actions, when such compensation cannot be achieved at the development site or would not be as environmentally beneficial." (Federal Guidance for the Establishment, Use and Operation of Mitigation Banks. U.S.EPA. 1995)
"Regulators are promoting wetland banking because it is a means to address fragmented mitigation by consolidating the mitigation needs of multiple projects at a single larger site. For developers and other permit applicants, there is notable advantage to purchasing credits from a mitigation bank - it frees the applicant of the liability for mitigation site development and performance. Most notably, preference for compensatory mitigation actions is awarded to mitigation banks, and permit applicants may purchase credits from an approved bank if it is available and sufficient credits exist." (Federal Compensatory Mitigation Regulations. U.S.EPA. 2008)
Overview of Wetland Mitigation Industry:
Wetlands mitigation banks represent one of the most developed market-based approaches in the U.S. for environmental conservation, and the most effective approach to compensatory mitigation. As an industry, wetland mitigation banking is still relatively young. The first wetland mitigation bank was established in Louisiana in 1984. In 1988 a study by the U.S. Fish and Wildlife Service found that 13 banks were approved around the country, and by 1992 approximately 46 banks had been established in 17 states, mostly in California and Florida. Most of the early banks were established to serve just one user, generally state highway departments, port authorities, etc; with a purpose primarily of providing mitigation for public projects. However, now it is currently estimated that at least 50% of banks are established for general use to service multiple users.
The number of banks has increased dramatically since then. In 2005, there were at least 391 operational mitigation banks, including 305 commercial and 86 single user banks and another 198 mitigation banks had been proposed (149 commercial and 49 single user banks)(Final Environmental Assessment, Finding of No Significant Impact, and Regulatory Analysis for the Compensatory Mitigation Regulation. U.S. Army Corps of Engineers. 2007) . In 2008, the Ecosystem Marketplace and the Mitigation Banking Association estimated that were over 500 banks operating across the United States.
"Wetlands are areas where water covers the soil, or is present either at or near the surface of the soil all year or for varying periods of time during the year, including during the growing season. Water saturation (hydrology) largely determines how the soil develops and the types of plant and animal communities living in and on the soil. Wetlands may support both aquatic and terrestrial species. The prolonged presence of water creates conditions that favor the growth of specially adapted plants (hydrophytes) and promote the development of characteristic wetland (hydric) soils. Wetlands vary widely because of regional and local differences in soils, topography, climate, hydrology, water chemistry, vegetation, and other factors, including human disturbance. Indeed, wetlands are found from the tundra to the tropics and on every continent except Antarctica." (http://www.epa.gov/owow/wetlands/vital/what.html)
Wetlands are essential for providing flood control, improving water quality, reducing the effects of global warming, and are the home of numerous species of migratory birds, fish and wildlife.
Restored, created, enhanced, and preserved wetlands generate "credits" which may subsequently be withdrawn to offset "debits" incurred at a number of project development sites. Credits may be established by using the ratios stipulated in state rules (OAR 141-85-135). The rules provide that restoration will be credited at a ratio of 1:1, creation at a ratio of 1.5:1, and enhancement at a ratio of 3:1. Disturbed cropped wetlands are credited at a ratio of 2:1. For restoration, this means that each acre of restored wetland will generate one mitigation credit. If credits are to be generated by creation or enhancement, 1.5 acres of created wetland or 3.0 acres of wetland enhancement, respectively, will be required to generate one mitigation credit.
In 2008, an acre of wetland mitigation credit (1 credit) was worth an average of $85,000 in the state of Oregon, and ranged from $50,000-$175,000 per acre.
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