New Wetlands Mitigation Rule—A Boost for the Mitigation Banking Sector
The U.S. Environmental Protection Agency and the U.S. Army Corps of Engineers recently issued revised regulations to the Clean Water Act . The new regulations govern compensatory mitigation for the fill of wetlands, streams, and other waters of the United States. The Clean Water Act states that compensatory mitigation is required to replace the unavoidable loss of wetland, stream, and/or other aquatic resource functions and area due to dredging and filling.
The new rule, effective June 9, 2008, encourages mitigation banking as the preferred option over in-lieu fees programs and permittee-responsible mitigation. EPA and the Corps explained in the comments to the new rule that mitigation banking is preferred because "mitigation banks must have an approved mitigation plan and other assurances in place before credits can be provided to permittees…Because of the requirements imposed on mitigation banks, they generally involve less risk and uncertainty than in-lieu fee programs and permittee-responsible mitigation.”
Until now, mitigation banks accounted for 33% of mitigation, while permittee-responsible mitigation accounted for 60%. In-lieu fee mitigation already was the minority at 7%. Under the new rule these percentages are certain to shift, and will likely cause a boost in the mitigation banking industry. It remains to be seen whether or not this new rule will result in filled wetlands being replaced by more ecologically viable wetlands. Dr. Joy Zedler, Chair of the 2001 National Resources Council Wetlands Mitigation Study Committee, put it best: "It could be the best of all worlds…or it could be the same old same old…It's all in the implementation."
Posted by Jeanette C. Schuster, attorney practicing in the Sustainability and Real Estate & Land Use Practice Groups.
