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Creek Week: New Galveston District Stream Mitigation Operating Procedure Published

Texas-Sized news for RS’ soon-to-open Katy Prairie Stream Mitigation Bank (KPSMB).  The Galveston District of the U.S. Army Corps has put on Special Public Notice a well-composed and carefully considered Standard Operating Procedure for complying with federal requirements for the compensation of streams (as distinct from wetlands).

Below is the new Galveston District Standard Operating Procedure for stream regulation and compensation:

Galveston Corps Stream Mitigation SOP and Tool

The KPSMB was planned by RS in 2007 to coincide within a year or two with the publication of the regulatory document above.  The stream SOP spells out how linear waters will be regulated and mitigated in the Galveston District.  It looks as though RS has succeeded in not being too early or too late on the mitigation side of the equation. The KPSMB will open in the next few weeks, shortly after the mitigation requirements are in place.

The Corps Galveston District did yeoman’s work building a comprehensive stream regulatory program from scratch since the publication of the Federal Mitigation Rule in 2008.  The final product is admirable (and subject to comment over the next year).  The SOP appears to have met the requirement of the Rule for in-kind regulation of streams, and also provided the regulated and banking community with a transparent and workable document from which to begin meeting the requirements.

Houston is America’s 4th largest market and the KPSMB will service the majority of the growing metropolis and its environs.  The bank is scaled to fit the town.  As far as we know, the KPSMB will be the largest permitted stream mitigation bank in the United States, with more than 20 miles of permitted restoration and protection potential.

Perhaps just as exciting for our firm is our land partners in the venture, the Katy Prairie Conservancy (KPC) and the Warrens.  The entire restoration project is situated along streams on the 6000 acre Warren Ranch owned by the KPC and the Warren Family.  The Warren Ranch, among other things, is the largest working cattle ranch in Harris County and Houston.

The Warren Ranch is an ideal location for the establishment of a stream mitigation bank. Here’s why: As credits are sold the Katy Prairie Conservancy and the Warren family will receive a royalty from sales which will allow the Conservancy, if they choose, to retire debt and permanently protect more uplands on the Warren Ranch with conservation easements, or acquire and protect additional threatened property in the watershed. As waters are restored and protected uplands will be protected as well.  A rare but fruitful dynamic in mitigation banking.

We love our landowners at RS but have never seen the proceeds from our real estate transactions go to more wonderful ends than is likely at this ranch and with the Katy Prairie Conservancy.

Victory on Jones Street: New state law means big changes for mitigation in North Carolina

As poorly headlined in last Sunday’s Raleigh News and Observer [Legislature OK’s Rule on Streams 6/19/2011], our little state trade association, the North Carolina Environmental Restoration Association, had a huge legislative win in the just adjourned 2011 session of the North Carolina General Assembly.  It is not our way at RS to get out ahead of ourselves, so Stories from the Field wanted to wait until the Governor signed the bill before announcing this bit of good news for the ecological balance of the Tar Heel state and commercial mitigation.

She signed it last night.

SESSION LAW 2011-343 puts the state fee-program and private mitigation banks in much closer compliance with the 2008 Federal Mitigation Rule by establishing a statutory preference for mitigation bank credits in North Carolina in almost all cases, as well as establishing “Full-Delivery” turn-key mitigation as the preferred method for contracting for the state’s continuing fee-program obligations where banks are not yet available.

The law continues the wise policy taking hold nationwide of transferring responsibility for restoring and caring for compensatory ecosystems from governments to privately capitalized and bonded green firms like RS and our competitors.  It almost ensures that mitigation in North Carolina will continue its progress from a state monoply functioning with state mandated “static” prices, to a vibrant ecosystem services market with true-cost competitive pricing.

All progress in commercial mitigation is incremental.  A win in the legislative halls for the NCRA is a long way from the bottom line of any individual company. But this legislation may finally have turned the ship of state in North Carolina toward performing mitigation that is not established according to available funds — but priced according to true costs.

The former method, state production and pricing, has failed miserably as detailed in the recent News and Observer series, “Washed Away.”  The latter method endorsed by the new law – establishing mitigation and then market pricing it for sale — makes sure that someone (I hope RS) is taking personal economic and ecological responsibility for a given impact to the waters of the U.S. within our state.

The bill description below may read like a wonky little change to policy but it makes a huge difference on the ground. It allows the green shoots of true-cost restoration and advance mitigation to grow in Tar Heelia without fear of being plucked by the cold dead hand of The Leviathan.

I can’t let this post end without giving a shout-out to the NCERA lobbyist from McGuireWoods Raleigh office, Harry Kaplan.  It takes a special kind of patience to navigate legislation in a heretofore unknown field with desperate entrepreneurs nipping at your heels in the halls.

Here is Harry’s summary of the law:

Analysis of Senate Bill 425:

During their 2008 Regular Session, the North Carolina General Assembly enacted legislation to provide that, under certain circumstances, certain applicants for compensatory wetlands mitigation must seek that mitigation from a private wetlands mitigation bank before seeking that mitigation from the Ecosystem Enhancement Program (“EEP”) in the North Carolina Department of Environment and Natural Resources. During their 2009 Regular Session, the General Assembly enacted legislation to extend this preference for private mitigation to the areas of riparian buffer protection and nutrient offsets. Under the law prior to the enactment of Senate Bill 425, the preference for private mitigation and nutrient offset did not apply to the State, the federal government, or to local governments.

Section 1.1 of Senate Bill 425 amends the definition of “governmental entity” in GS 143-214.11 (Ecosystem Enhancement Program: compensatory mitigation) so that the preference for private mitigation and nutrient offsets now applies to local governments unless the unit of local government was a party to a mitigation banking instrument executed on or before July 1, 2011, notwithstanding subsequent amendments to such instrument executed after July 1, 2011. Section 1.1 defines a “private compensatory mitigation bank” as a site created by a private compensatory mitigation provider and approved for mitigation credit by State and federal regulatory authorities through execution of a mitigation banking instrument. No site owned by a government entity or unit of local government shall be considered a “private compensatory mitigation bank.” Section 1.1 also requires an existing local compensatory mitigation bank to comply with the requirements of Article 12 of Chapter 160A of the General Statutes governing the sale and disposition of property whenever it transfers any mitigation credits to another person.

Section 1.2 of Senate Bill 425 establishes a new process by which the EEP provides for compensatory mitigation. This new process creates a priority system for different types of programs for the procurement of compensatory mitigation – with “Full Delivery/Bank Credit Purchase Program” listed as the first priority. Under Senate Bill 425, EEP must first seek to meet compensatory mitigation procurement requirements through its Full Delivery program or by the purchase of credits from a private compensatory mitigation bank, as defined above.

Senate Bill 425 became effective when it became law on June 17, 2011 and applies to all projects and contracts awarded on or after that date.

Ecosystem Marketplace: Mitigation Bankers Say Army Corps Not Following the Rule

From Hannah Kett and Ecosystem Marketplace

According to law, if you damage a wetland in the US, you must restore a comparable piece of property in the same watershed. A 2008 regulatory rule says wetland credits from a mitigation bank should be your first option. Mitigation banks, however, say this isn’t happening, and they want the Army Corps of Engineers to tell them why. The Corps says it’s just trying to be flexible – and promises more transparency in the future.

29 September 2010 | In April, 2008, wetland scientist Rich Mogensen read “The Rule” and speculated that the number of wetland mitigation banks in the United States could triple from 500 then to 1500 right about now as a result of its issuance.

Officially titled the Compensatory Mitigation Rule for Losses of Aquatic Resources, the Rule was jointly issued by the US Environmental Protection Agency and the Army Corps of Engineers (USACE) (with a push from Congress), and it declared that anyone who damages a US wetland should look first to mitigation bankers to compensate for the damage before exploring other alternatives.

National Mitigation Banking Association letter to Army Corps of Engineers regarding the implementation Fede… Read more

SwampGate: News and Observer busts EBX for hitting the punch bowl twice

Quite a find on my porch this morning. The state’s paper of record revealed a long-stewing controversy in the obscure but important world of compensatory environmental mitigation policy.  [EBX paid twice for wetlands work, December 8, 2009]  RS’ principal competitor, Environmental Bank and Exchange (EBX), sold nutrient mitigation credits to the North Carolina Ecosystem Enhancement Program subsequent to the site being banked, restored and previously paid for by the North Carolina Department of Transportation for wetland mitigation credit.  In industry parlance —  we call this a “double-dip.”

Read more

Guidance: Army Corps Savannah District Releases Draft Guidelines for Mitigation Banking

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The updated guidance for mitigation banking in the Savannah Army Corps District has at long last arrived. As regular readers will know, in summer 2008 the Army Corps of Engineers and the Environmental Protection Agency promulgated an extensive regulation to reform and improve compensatory mitigation and mitigation banking for the 404 Federal wetland regulatory program. Presumably, each Army Corps District will at some point issue a document similar to this one in order to conform local practice and previously issued guidance to the new federal regulatory standards.

I have only skimmed the guidance document but (as expected) it appears to be excellent work. The Savannah District and the Georgia IRT (Interagency Review Team) already administer a relatively well-functioning and responsive mitigation banking regulatory system. It is no surprise to see them lead the nation in updating their regs in a comprehensive and thoughtful manner. Don’t get me wrong: I am sure there are bugs in it. But this document is a draft — and “Stories from the Field” will let you know in future posts what we think does or doesn’t work.

Another tip of the hat goes to the newly formed Georgia Environmental Restoration Association (GERA). Modeled to some degree after North Carolina’s NCERA, the GERA was formed last year and has quickly mobilized to improve compensatory mitigation banking in GA. GERA is a “must-join” for working down there.

Proposed Savannah Corps regs here

RS assists in National Survey of Mitigation Bankers

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The indispensible Ecosystem Marketplace published a second story in a week involving RS.  (Here is the first). This one is a lot drier, but also filled with consequence for and insight into the emerging markets for compensatory mitigation and ecosystem services (a term for another blog).

When I get a chance, I will blog some about the background of the survey, it’s conclusions, and the propects for its continuation.  But, for now, I just wanted to share the link below, and recognize Ecosystem Marketplace for their coverage of these important issues as they develop.

The Katoomba Group's Ecosystem Marketplace

Mitigation Bankers Say New Rule Heightens Old Conflicts: Survey

by Todd BenDor, J. Adam Riggsbee, and George Howard

About the Survey

This article has been adapted from the Executive Summary of A National Survey of Federal Mitigation Regulations and their Impacts on Wetland and Stream Banking. You can download the full report, including the executive summary, above.

It’s been more than a year since the United States enacted uniform procedures for
offsetting lost wetlands across the country, but market participants say “The Rule” has neither calmed the conflicts it was designed to eradicate nor driven business to mitigation banks. The reason, they say, is that regulators are as regionally inconsistent as ever.

20 November 2009 | When the US Environmental Protection Agency and Army Corps of Engineers released their long-awaited regulations for offsetting lost wetlands in March of last year, everyone seemed to agree that “the Rule” – as the regulations are collectively and colloquially known – would encourage the expansion of mitigation banking to provide compensatory mitigation for unavoidable impacts to the nation’s

wetlands.

Webinar: New Mitigation Rule Compliance for the NC Fee Program

nceep_weblogo

This should be interesting:

Dear Colleagues:

The U.S. Army Corps of Engineers Wilmington District, the U.S. Environmental Protection Agency and the N.C. Ecosystem Enhancement Program invite your participation in a Webinar on Dec. 16, 2009 at 10:00 a.m.  The purpose of the Webinar is to provide the latest status of EEP’s conversion to the new federal mitigation rule, including the review of specific provisions of the draft instrument.

If you wish to participate in the Webinar, you must register your interest with EEP by Dec. 7.  Participants will be sent information on how to access the meeting via the Internet and telephone.  To sign up, please send an email to Eric Ellis of EEP (eric.ellis@ncdenr.gov) by Dec. 7, and please feel free to share this announcement with others that you think would be interested.

Tad Boggs

Director of Communications

N.C. Ecosystem Enhancement Program

919-715-2227 www.nceep.net