What Is Mitigation Banking?
Mitigation banking typically involves the consolidation of small, fragmented mitigation projects into one large contiguous site. Units of restored, created, enhanced or preserved land are expressed as “credits” which may subsequently be withdrawn to offset “debits” incurred at a project development site. Mitigation banking unites sound environmental and economic practices to restore and enhance wetlands, streams, and other habitat resources.
Mitigation bankers restore, enhance, create and preserve water resources or other significant natural areas and assume responsibility for their long-term maintenance, earning mitigation credits, recognized by the regulatory agencies, for their efforts. Mitigation bankers can then sell these mitigation credits to permittees and others who must compensate for having impacted water resources or other natural areas.
Types of mitigation banks:
- Wetland/Stream Banks: These banks offer credits that satisfy regulatory compliance for Section 404 of the federal Clean Water Act, and other State and local regulations, for mitigating unavoidable impacts to wetland and stream resources.
- Conservation Banks: These banks offer credits that satisfy regulatory compliance for Sections 7 and 10 of the federal Endangered Species Act, and other State and local regulations, for mitigating unavoidable impacts to threatened and endangered species and their habitats and other sensitive habitat areas.
What is the process to become a Mitigation Bank?
Mitigation banks are highly regulated areas environmental agencies. Before a bank can be permitted and approved for credit sales, federal and state government regulatory agencies form a Mitigation Banking Review Team (MBRT) or Conservation Banking Review Team (CBRT) that must approve plans for building the bank, including for example the hydrological and planting design to maintenance and monitoring arrangements. The MBRT/CBRT also approves the number of mitigation credits that may be earned by the Banker.
Who buys the credits?
An applicant who has applied to the federal and/or state agency responsible for wetland/stream or species permitting, and has provided adequate justification of a need to impact the natural resource in question.
What are the benefits of utilizing mitigation bank credits?
- Reduces permitting processing time and saves money.
- Eliminates risk and responsibility as the credit transaction legally transfers all responsibility for mitigation to the mitigation banker.
- The mitigation bank assures appropriate financial and scientific resources are utilized to ensure the mitigation is successful. The perpetual maintenance of the bank’s environmental assets creates a higher level of success.
- Mitigation is typically performed in advance to the impacts, therefore reducing or eliminating temporal loss of wetland and other resource functions.
- Mitigation is always assured to occur within one year of resource impacts and financial securities and conservation easements are in place prior to resource impacts.