This is a First: Wetland Mitigation Infographic

Folks over at MS USA have developed what appears to be the first and only infographic about wetland mitigation available on the internet. It provides a nice explanation and history of wetland mitigation banking. Enjoy!

Digging in: 2013 Research on ‘Level Playing Field’ of 2008 Wetland Mitigation Rules

In 2008, the US EPA and Army Corps of Engineers released their final rule on Compensatory Mitigation for Losses of Aquatic Resources (2008 Rules). The 2008 Rules were intended, in part, to right some wrongs of earlier wetland mitigation. For one, originally compensatory mitigation was steered towards mitigating close to the site of impact. But that could lead to postage-stamp mitigation, isolated from other resources and minimal ecosystem services. So the 2008 Rules gave preference to larger-scale wetland restoration in a watershed context.

(Image credit: Kerry ten Kate presentation, BBOP, circa 2010)

Another wrong to right was temporal loss of wetland functions and values. Let’s say I start restoring a wetland. Year 1 doesn’t look pretty – muddy, goopy mess with some tiny sticks trying to become trees. But it starts looking better and better as hydrophilic plants get established, as the hydrology is restored, etc. And as the wetland gets better, so do its functions – like its ability to filter water, its ability to absorb and slowly release storm flows, its ability to provide a home for critters. Mitigation banks have to have restoration in place before selling credits,*so the restoration is in place before the impact. Prior to the 2008 Rules, In Lieu Fee programs (ILFs) could collect funds and then perform the mitigation. Permittee-responsible mitigation didn’t and still doesn’t have to happen in advance of impacts.

Prior to 2008, there was not a ‘level playing field’ for mitigation. In-advance, larger-scale mitigation was costlier and riskier than at-the-time-of-impact mitigation. Cheaper, smaller-scale permittee-responsible mitigation could beat out other forms of mitigation even if it wasn’t the best thing for the environment.

The 2008 Rules set out a preference hierarchy for mitigation**:

“In order to reduce risk and uncertainty and help ensure that the required compensation is provided, the rule establishes a preference hierarchy for mitigation options. The most preferred option is mitigation bank credits, which are usually in place before the activity is permitted. In-lieu fee program credits are second in the preference hierarchy, because they may involve larger, more ecologically valuable compensatory mitigation projects as compared to permittee-responsible mitigation. Permittee-responsible mitigation is the third option, with three possible circumstances: (1) conducted under a watershed approach, (2) on-site and in kind, and (3) off-site/out-of-kind.” (Source: [2008 Rule] Questions and Answers, see also 40 CFR Chapter I § 230.93(b)(2))

So how’s that been going? Mitigation bankers say the preference hierarchy has not been followed in many US Army Corps of Engineers Districts. There is not, however, a national analysis of this (that I’ve seen). So it takes some digging at the District scale to see what’s going on. Like:

• What are these “consolidated mitigation areas” that are being used in Arkansas for frac pond mitigation? There is zero mention of the term in the 2008 Rules.
• Why did an Alaskan ILF sit on mitigation funds for more than 10 years before figuring out what to do with it?

The latter question is something that I wrote about on Scoop.It. Following that post, I was contacted by a law firm who asked that I dig into questions like these. So I’ll be digging in to the ‘level playing field’ question, FOIAs and all, and posting white papers and blog posts synthesizing the research. Wish me luck!

*Actually, they get to sell a small amount of credits after legal protections have been put in place.
**The 2008 Rules include a caveat to the preference hierarchy of mitigation:
“However, these same [see above] considerations may also be used to override this preference, where appropriate, as, for example, where an in-lieu fee program has released credits available from a specific approved in- lieu fee project, or a permittee- responsible project will restore an outstanding resource based on rigorous scientific and technical analysis.” (40 CFR Chapter I § 230.93(b)(2))

4 Wetland Mitigation Concepts Explained via Memes

The concept and practice of wetland mitigation banking is complicated to explain and understand. I thought I’d present key concepts using internet memes.

Concept 1: the Mitigation Hierarchy

The mitigation hierarchy is a concept used to explain how and when it’s acceptable to impact a natural resource and pay someone else to restore &/or protect it somewhere else. Here’s how it goes. A natural resource law prohibits impacts to wetlands/endangered species/biodiversity/native vegetation, but provides exceptions through a permitting process. To avoid the scenario where just about anyone can get a ‘license to trash’ the environment, so long as they write out a check or make it all better somewhere else, the permit process provides hurdles. One: you’ve got to show that you avoided impact to X natural resources. Two: you’ve got to show that you minimized impacts. Then and only then will the regulators consider letting you mitigate do compensatory mitigation* [note: they call it ‘offset’ outside the US].

*EPA’s official sequence is Avoid, Minimize, Compensate; with compensatory mitigation defined as “restoration, establishment, enhancement, or in certain circumstances preservation of wetlands, streams or other aquatic resources for the purpose of offsetting  unavoidable adverse impacts.”

Concept 2: How the Mitigation is Done

Mitigation generally means restoration, enhancement, creation, and preservation of a natural resource. So for wetlands, what is often served up as mitigation is nice piece of degraded wetlands, restored with some un-ditching or dam-busting, curvy-stream building, and water-loving plants. Who does the restoration? It’s either do-it-yourself (called permittee-responsible mitigation), or done by someone else–either an in-lieu fee program (a government agency or non-profit organization), or a mitigation bank (a for-profit company). The latter two types of mitigation accept funds and provide larger-scale restoration. Mitigation lands must be permanently protected by a conservation easement.

3. No Net Loss

Since a presidential mandate in the late 1980’s under  the Bush (H.W.) administration, the US has had a policy goal of “no net loss” of wetlands. Don’t impact more than you restore. But numerous studies have shown that ecologically, wetland mitigation isn’t as good as keeping what you’ve got in the first place. Here’s a meta-analysis (note that bigger restoration does better). For mitigation banks, I’ve often noticed a distaste that someone would make a profit on environmental restoration that comes at the cost of a loss of natural resources. The alternative then, is 1) to protest against issuance of permits to impact wetlands in the first place, and/or 2) to ensure that mitigation banks are held to standards as high as mitigation provided from government or non-profit sources. Ironically, mitigation bankers argued that other sources of mitigation were held to standards lower than theirs and successfully lobbied for equivalent standards in 2008 regulations. Bankers also note that they have a record of meeting 98% of their performance standards.

4. Wetland Mitigation Banking 102: Credit Stacking

Go to any conference on wetland mitigation banking or any other environmental market and there will be at least one session on credit stacking. This is a largely theoretical discussion about the opportunity for multiple credits (and implied, multiple payments) for multiple ecosystem services that a piece of land provides. If a land provides wetland functions and values AND endangered species habitat, why shouldn’t you be allowed to create multiple credits? You can, in some situations, but the criticism will come when you try to sell multiple credits without proof of additional services, functions, or financial investment.

So there you go. Four key wetland mitigation concepts. Here’s a bonus Neil deGrasse Tyson meme I made but I couldn’t figure where it belonged.

FY 2011 US ACE Annual Report – lame ‘no net loss’ of wetlands measures

See on Scoop.it – Nature + Economics

Want to know how many acres of impacts to wetlands are permitted each year? Want to know whether the nation is keeping up with ye olde goal of ‘no net loss’ of wetlands? Well, don’t look in the US ACE’s annual performance report because all you will find is non-area data. Seriously.

Here’s the indicators you get:

Arghhhh!

See full FY2011 report on comptroller.defense.gov

Dow US ACE public notice and ecosystem services approach

See on Scoop.it – Nature + Economics

Part of the Dow-TNC $10 million partnership on ecosystem services is a project to estimate the value of coastal marshes in protecting against natural hazards/storm surges. “Understanding the value of protecting and restoring these marshes as natural infrastructure will allow Dow to include them in coastal risk assessment decisions alongside gray infrastructure options like existing and proposed levees.” Another project is to study “the location of the Brazos River’s “salt wedge,” which can impair access to freshwater during times of drought and low flow.

In light of those ecosystem services projects, what do you make of this public notice to install a sand berm armored with gravel across the Brazos River temporarily – “installed as needed, during threats of saltwater intrusion, and naturally removed/dissipated by storm action.” How would this change post-ecosystem service analysis?

See on www.swg.usace.army.mil

Speed blogging through July

Back from an extended hiatus travelling for fun, for learnin’, and for work. The learnin’ part was a 2-week Enviropreneur fellowship sponsored by the Property and Environment Research Center which is a libertarian-style organization that advocates for market solutions for environmental problems. A couple of intriguing examples include the positive effect of for-profit game ranching on white rhino populations in South Africa, and a proposal to Save Rivers, Destroy Trees (not always, not everywhere… but read more here for a compelling case).

To get back in the groove of blogging, here’s a bit of speed blogging from my backlog of 792 stories on Google Reader:

• Shareholders demand sustainability: “Advocacy group Ceres says of the some 110 resolutions is tracked in 2012, 44 proposals resulted in US companies making commitments to confront environmental and social risks in their operations and supply chains.”
• Coca-cola is improving its water efficiency by 35%
• Burning Our Rivers: a report on the water footprint of electricity generation
• Water quality trading – it’s not just for TMDLs, urges industry group to EPA.
• A quick run-down about why businesses were involved in the Rio+20 Summit and what they got out of it, including a nice compilation video of quick interviews with NGOs and business execs.
• Well I’ll be! Texas Army Corps of Engineers Galveston District investing in ecosystem services: “…we have initiated a comprehensive study of the upper Texas coast from Sabine to Galveston in collaboration with the Texas General Land Office that will look for opportunities for large-scale ecosystem restoration projects to protect not only habitats, but the Texas coast from storm surge and erosion.” Their partners include a county flood control district, multiple port authorities, and the Nature Conservancy.
• An NYT piece about the greening of professional sports.
• I know this is business-as-usual for Environmental Impact Statements for endangered species, but I still find it interesting to see what kind of projects impact species: road-building, mining, airports/ports, wind energy development, and more.
• Want to learn a lot about carbon markets and get paid (modestly)? Ecosystem Marketplace is hiring a Carbon Markets Research Assistant. Apply by July 30.
• Wolf hunting allowed in MT, while 3 are sentenced for wolf poaching in WA
• A west Texas op-ed says they’d rather deal with endangered species issues voluntarily because “those advocating extreme conservation measures bear little or none of the costs or consequences they so enthusiastically would impose upon landowners.”
• ..and on that note, there’s a nice, lighthearted piece reviewing the ideas in an Scientific American article about endangered species triage – the idea that given monetary constraints, which species do you want to save?
• Voluntary Candidate Conservation Agreements with Assurances (CCAAs) on the lesser prairie chicken may be working – at least according to some optimistic results from a range-wide aerial survey conducted by the FWS. Final results are forthcoming. The l p chicken is a candidate species –  it’s in the ‘maybe’ pile re: endangered listing.
• Another candidate species – the greater sage grouse – is also getting some voluntary investments from energy companies out West. Apparently, by protecting sage grouse on private rancher land, in the hopes of precluding the need to list the species as endangered. New bumper sticker: “Save the species. It’s cheaper!”
• More demands for species protection under the ESA: 10 species in FL, 53 reptile and amphibian species
• Your 2 cents: open comment period (through Sept) on a Habitat Conservation Plan for endangered Indiana bat from impacts from wind farm development in OH.

If you’re hungry for news on a more regular basis, check out my Scoop.it page on Nature+Environment.

I’ve quickly come to love Scoop.it for its ability to be my online searchable ‘clipboard’ with a nice visual reference and ability to make notes on what I thought was interesting about the article/report. It’s also waaaay better than Pinterest for this purpose b/c it’s more geared for articles than pretty things.

Conference Bound

This week, I’m heading to the National Mitigation and Ecosystem Banking Conference (NMBEC) in Sacramento, California. I’ll be blogging with my old friends at Ecosystem Marketplace – check it out on their www.Eko-Eco.com blog.

I’m looking to catch up on news in the mitigation and conservation banking world, find out about innovative projects, and check in with colleagues. I’ll be posting some impressions from the conference this week, along with the official scoop on Eko-Eco.

Want to Meet Bankers in Waders?

The pre-registration deadline (read: cheaper price) for the National Mitigation and Ecosystem Banking Conference is tomorrow, March 15. This is *the* conference to go to if you are interested in any aspect of US wetland and conservation banking, and a bit on water quality trading too. If you’re early in your career and you’re interested in this field, you might get overwhelmed (I know I was at my first conference) but you’ll learn a lot and meet great people. If you’ve been in the field for a while, this is your chance to catch up with your industry peers. And if you’re not from around these parts (e.g., an international researcher or consultant interested in the US mitigation banking system), it’s an excellent chance to meet anyone you’d want to meet all in one spot. See you there!

Register here.

Review: Lawyers, Swamps and Money

Royal Gardner delivers an easy read on the complex world of US wetland mitigation in Lawyers, Swamps and Money: U.S. Wetland, Law, Policy and Politics. I’ll admit it, I let this book sit on the end table for a while, expecting a mind-numbing read. But if a normal law book is like eating your brussels sprouts, this book is guacamole funny. Mr. Gardner has a light tone and peppers the book with humorous illustrations and anecdotes, while sneaking in nutritious law and policy.

This is a great book for anyone interested in the U.S. system of wetland mitigation (/banking), providing background on the law that underpins it as well as recent developments. The book also laid out the ‘odd bedfellows’ situation of the U.S. Army Corps of Engineers’ and Environmental Protection Agency’s joint power over wetland regulations that had me head-scratching for years.  And no wonder–it truly is a confusing relationship. If you’re a legal nerd, you’ll enjoy the detailed story of court decisions that have altered the bounds of regulations over the years. The book ends with a series of excellent recommendations for clearing the waters of regulation and implementation. Take note, regulator s- you have been served up a platter of free advice from one of the top wetland lawyers in the nation.

So in short, you should buy this book if you are: a U.S. wetland regulator, policy-maker, lawyer, banker, in-lieu fee provider, researcher, or consultant. It would also benefit international researchers and policy-makers interested in a compliance-driven environmental market that brings ~$2 billion and over 20,000 acres annually into wetland restoration and conservation.

Wetland Mitigation Bank Initial Investments are Sunk Costs, no Takings Allowed

Hat-tip to EcoAnalytics for the heads-up…

Hearts Bluff Game Ranch, Inc. v. United States is a legal case from my neck of the woods related to mitigation banking. The skinny: if you don’t yet have a mitigation banking instrument (MBI) but only a greenlight from the US Army Corps of Engineers, you can’t claim takings if the Corps later decides not to grant an MBI. The money spent in-between initial ok and signing the MBI is risky money.

Here’s a quick, non-lawyer run-down. A mitigation bank called Hearts Bluff was being considered in east Texas. The banker approached the Corps with the idea of bank, and the Corps gave it an unofficial ok. At that point, the mitigation banker began investing money to turn the land into the bank. Fast-forward several years. A reservoir project in the vicinity of the proposed mitigation bank that had been in the ‘maybe’ pile now moves to the ‘definitely’ pile. The reservoir project, however, can’t happen with a mitigation bank in the area. The mitigation banker had at this point not gotten a mitigation banking instrument approved by the Corps. The Corps then informs the banker that the mitigation banking permit (which is required for the bank to sell credits) isn’t going to happen. Bank sues with a takings claim:

Hearts Bluff asserts that as a landowner it is entitled to operate a mitigation bank on its land and that the Corps’ rejection of its mitigation bank proposal was a taking of its property right.

And the government responds nuh-uh. Below are some snippets from the Court’s decision. Happy reading, lawyers!

Hearts Bluff was never entitled to operate a mitigation bank solely by virtue of its ownership of the land and that it did not have a property right in access to the mitigation banking program because the program is entirely a creature of the government and subject to pervasive and discretionary government control. We agree with the government that Hearts Bluff does not possess a compensable property interest in obtaining a mitigation banking instrument.
…
Hearts Bluff purchased land, not a mitigation bank instrument or mitigation bank credits. At no point did Hearts Bluff possess a right to sell or transfer mitigation bank credits or a mitigation bank instrument. It is possible at some point in the future that the Corps could grant a mitigation bank instrument applicable to the property. But without such an instrument, Hearts Bluff is still able to sell, assign, or transfer the land, or exclude others from its use, as it always was able to do. Hearts Bluff is even free to create and preserve environmentally friendly wetlands on the same property, as it desired to do under the mitigation banking program. In short, the Corps’ denial did not diminish in any way the rights Hearts Bluff possessed the day it purchased the land, after it applied for the permit, or after the Corps denied the permit. Owning land in and of itself does not give rise to a right to run a mitigation bank, and obtaining a mitigation instrument is therefore not a cognizable property interest.
…
Finally, Hearts Bluff argues that the representations by the Corps that the land was suitable for a mitigation bank gave rise to a reasonable investment-backed expectation property interest. Hearts Bluff argues that the Corps’ representations caused it to invest hundreds of thousands of dollars in developing a mitigation bank. The government responds that Hearts Bluff merely hoped that the Corps would exercise its discretion and authorize entry into a mitigation banking instrument, and that such hope or expectation is a collateral interest, not a cognizable property interest. Again, we agree with the government.