The face of mitigation banking has changed substantially over the past 10 years, according to a report released by the Environmental Law Institute. Based on a two-year study of off-site compensatory mitigation, ELI found that wetland mitigation banking has evolved from a small industry dominated by state and local governments to a growing nationwide commercial enterprise dominated by entrepreneurs. Building on ELI’s 1993 study of wetland mitigation banking, Banks and Fees: The Status of Off-Site Wetland Mitigation in the United States describes and analyzes wetland mitigation banks, in-lieu-fee mitigation, and umbrella banks, and makes recommendations for improving their effectiveness.
Since the early 1990’s, federal agency guidance and legislation, and state policies and legislation have promoted the use of wetland mitigation banking, which allows developers to compensate for the negative impacts of their development projects on existing wetlands by paying for the restoration or conservation of an off-site wetland. In turn, the practice has thrived, as has the use of in-lieu-fees, in which a developer pays a sponsor to restore or conserve wetlands at a future date. Yet, in the past 10 years, no study has documented all of the banks and in-lieu-fee programs in the country.
“Without this information, federal, state, and local policymakers, conservationists, the regulated community, and the public lack the ability to assess the impacts of these compensatory mitigation approaches on wetlands resources,” said Jessica Wilkinson, Director of ELI’s Wetlands Program.
The 2002 study documents 219 approved banks — a 376 percent increase of banks in the country since 1992. At least another 95 banks are pending approval. In the early 1990s, nearly 75 percent of the nation’s existing banks were single-user banks sponsored by state or local governments with only one private commercial bank in operation. Today, of the 214 approved banks analyzed, 135 are private commercial banks and 61 are single-user banks. In addition, there are currently 87 active in-lieu-fee programs in 27 states administered by the Corps, or by state or local government. However, a significant number of in-lieu-fee programs fail to adequately document their activities.
Wetland mitigation banking, in-lieu-fee mitigation, and mitigation banking approved under umbrella agreements, which incorporate multiple wetland sites under a single sponsor, all hold great promise for improving the effectiveness of compensatory mitigation. The study makes available to the public information on the location and character of these sites with the hope that the data will help local groups get involved in incorporating local concerns into mitigation siting and design. Beyond the published report, ELI has posted its compiled data on banks and fees in a comprehensive database at http://www.eli.org/Program_Areas/WMB/index.cfm. Funding for this study was provided by the David and Lucile Packard Foundation and the U.S. Environmental Protection Agency.
Banks and Fees: The Status of Off-Site Wetland Mitigation in the United States may be ordered from ELI for $24.99 plus shipping by calling (800) 433-5120 or online at http://www.eli.org. For more information about ELI’s Wetlands Program or the Environmental Law Institute, please contact Jessica Wilkinson at (609) 818-0518 or email Pressrequest@eli.org.