Restoring competition in wetlands

CHAPEL HILL — With North Carolina facing a looming budget deficit, Governor Perdue has cited "green collar" jobs as an area of targeted growth to provide a needed spark to the state’s economic engine. By John Preyer

I applaud the new governor for her interest in promoting economic growth related to jobs that have the added benefit of being good for the environment. However, the best way she can accomplish this worthy goal is to follow the central tenant of the Hippocratic Oath – first, do no harm.

That’s because, for more than 10 years, the state has been directly competing against existing green collar jobs in a way that has led to the stifling of an industry that would otherwise be a great success story of green job creation.

I happen to know something about this subject as I co-founded a "green" company in 1998. It originally specialized in wetland mitigation and has since grown to include stream, riparian buffer and nutrient offset mitigation. We have 15 employees.

North Carolina, unlike almost all other states, has operated a state wetland mitigation program under the Department of Environment and Natural Resources since the legislature first authorized it in 1996. The purpose was to provide a state-sanctioned clearinghouse for all mitigation needs, so that the unavoidable impact (destruction) of certain environmental resources, due to permitted development activities, would be offset with the requisite amount of mitigation.

How did it work here?

Not so great. The first iteration of the concept was called the Wetland Restoration Program and, as The N&O revealed in a front-page story on Jan. 2, 2002, the program took in over $58 million in payments from development interests for mitigation needs over five years, but completed just 10 acres of mitigation.

This debacle resulted in a repackaging of the program with a new, grander name, the Ecosystem Enhancement Program, or EEP.

The EEP came into being in 2003 with an initial staff of six. The intent was for a small staff to oversee a competitive bid process involving green companies like ours (and others). The bidder would be responsible for all components of the project: site identification, land acquisition, technical evaluation, mitigation design, construction, planting and five years of monitoring to insure success.

In addition, the EEP would also maintain a smaller internal mitigation program to do these same tasks but with full government command and control over all the components, including land acquisition.

Guess what happened?

The EEP has grown to a staff of over 60 in five years and today occupies part of a former industrial warehouse complex on Capital Boulevard. The vastly expanded staff has steadily pursued a policy of trying to perform its mitigation work internally, rather than putting it out for competitive bid to mitigation companies.

The Perdue administration needs to look closely at this program and how it obtains its mitigation if it truly wants to help sustain existing green collar jobs and promote new ones.

It should also follow the lead of the most recent short session of the General Assembly, which enacted S. 1885 (An Act to Promote Compensatory Mitigation By Private Mitigation Banks). The bill establishes a preference for private mitigation banks (landrestored, enhanced, and or preserved to offset unavoidable impacts to aquatic resources resulting from development) in watersheds where they are located, and precludes the EEP from competing with those mitigation banks. One of the advantages of private mitigation banks is that they don’t require any state funding; instead they rely on the capital and resources of private companies to do the same work the state is doing with the EEP.

Perhaps the single greatest thing that distinguishes private mitigation from EEP-performed mitigation is the incentive to succeed. The projects that my company puts in the ground have to succeed in order for us to get paid. In contrast, no one has a similar motivation at EEP; they get paid regardless.

In my view, the history of government-performed mitigation in North Carolina is one of failure and empire building at the expense of the environment.

The last thing any business wants, especially today, is to have to compete against a state government program for its work. The new administration can unleash existing and add new green collar jobs in the mitigation industry simply by scaling back an inefficient state government program.

John Preyer is a partner in Restoration Systems and serves on the EEP Liaison Council representing private mitigation companies.