II. Federal Endangered Species Act §10 : Financing Conservation

1. II. Federal Endangered Species Act §10: Financing Conservation • Opportunities • Supports land acquisition • HCPs address broad-based, landscape-level planning issues • Limitations • Mitigation is targeted to offset impacts to the specific listed species from permitted activities • Site selection is applicant-driven

2. III. Federal Natural Resource Damage Programs • Hold liable parties that are responsible for injuries to the environment • NRDs may be assessed under: • Comprehensive Environmental Response, Compensation, and Liability Act • Clean Water Act • Oil Pollution Act of 1990 • Park System Resources Protection Act • National Marine Sanctuaries Act

3. III. Federal Natural Resource Damage Programs • Cost of injury assessment and restoration • From 1997-2005: $87.7 million Lordship Point, CT remediation New Bedford Harbor, MA PCBs and toxic metal contamination

4. Estimated Annual Compensatory Mitigation Costs Environmental Law Institute. October 2007. “Mitigation of Impacts to Fish and Wildlife Habitat: Estimating Costs and Identifying Opportunities.” Washington, DC: Environmental Law Institute. Supported by the Doris Duke Charitable Foundation

5. III. Federal Natural Resource Damage Programs: Financing Conservation • Opportunities • May allow for restoration, replacement, and acquisition of equivalent resources • NRD restoration plans must be available for review by responsible parties, trustees, other interested agencies and tribes, and “any other interested member of the public” • Limitations • NRD restoration must be equivalent = on-site restoration and off-site in-kind restoration

6. IV. Federal Power Act • Authorizes FERC to issue and renews licenses for hydropower project • License issuance, reissuance or surrender may require mitigation actions

7. IV. Federal Power Act • 2003-2006: FERC issued 70 EAs and final EISs • Itemized recommended mitigation measures • On average of $210.3 million/year

8. Estimated Annual Compensatory Mitigation Costs Environmental Law Institute. October 2007. “Mitigation of Impacts to Fish and Wildlife Habitat: Estimating Costs and Identifying Opportunities.” Washington, DC: Environmental Law Institute. Supported by the Doris Duke Charitable Foundation

9. IV. Federal Power Act: Financing Conservation • Opportunities • Federal, state agencies make recommendations on “protection, mitigation and enhancement” (PME) measures including mandatory conditions and fishway prescriptions • Limitations • Mitigation is applicant-driven • Mitigation actions must be made within the context of energy development and conservation

10. V. Northwest Power Act • Encourages the development and conservation of electric power in the Columbia River Basin • Seeks to “protect, mitigate and enhance” fish and wildlife in the river and its tributaries • Provides funding for projects that include protection, mitigation, and enhancement measures

11. V. Northwest Power Act • Hydropower project mitigation expenditures • 2003 – 2005: Averaged $207.1 million/year 1,400-acre Willamette Valley Ranchpreserved as partial mitigation for impacts of hydropower dams on fish and wildlife of the Columbia River Basin. 12,533-acre Sagebrush Flats Wildlife Area northwest of Ephrata. Preserved as partial mitigation or habitat lost with construction and operation of Grand Coulee and Chief Joseph hydropower dams.

12. Estimated Annual Compensatory Mitigation Costs Environmental Law Institute. October 2007. “Mitigation of Impacts to Fish and Wildlife Habitat: Estimating Costs and Identifying Opportunities.” Washington, DC: Environmental Law Institute. Supported by the Doris Duke Charitable Foundation

13. V. Northwest Power Act: Financing Conservation • Opportunities • The Council is required to solicit and must give “due weight” to recommendations from fish and wildlife agencies, tribes, and other parties in developing mitigation projects • Limitations • Compensatory mitigation is solely limited to actions that address fish and wildlife in the Columbia River and its tributaries

14. Stream Mitigation • RGL 02-2 (2002): “Districts should require compensatory mitigation projects for streams to replace stream functions.” • Rule (2008): clarifies requirement for stream compensation Alaculsy Mitigation BankMurray County, GA Sponsored by: Wetland & Ecological Consultants, LLC

15. Mitigation Bank Credit Types (2005) Proportion of approved mitigation banks that sell only wetland credits, both wetland and stream credits, and only stream credits (data available for 380 out of 405 approved banks).

16. ILF Program Credit Types (2005) Proportion of approved, active in-lieu-fee programs that sell only wetland credits; only stream credits; both wetland and stream credits; and wetland, stream, and other credits (data available for 42 programs).

17. Biennial legislation to study, plan, and carry out water resource development and restoration projects An authorization bill; appropriations are needed for funding Construction funding averages $1.6 billion/year Water Resources Development Act 2007

18. Water Resources Development Act 2007 • Corps failed to prepare mitigation plans for ~70 percent of its projects from 1986-2001 • Requires minimum mitigation standards for projects USACE Flood Control & Ecosystem Restoration Project Photo: Honolulu District

19. Water Resources Development Act 2007 • “A water resources projects that involves wetlands mitigation and that has impacts that occur within the service area of a mitigation bank…[the Corps] shall first consider the use of the mitigation bank…” §2036. Levee construction for Dredge Material Placement Area on Victoria Barge Canal, Victoria, Texas

20. The Arrival of Private Capital $300-500 million/year committed to investing in wetland mitigation banking

21. Compensatory Mitigation Hierarchy under 2008 Rule • Mitigation bank credits • In-lieu fee program credits • PRM under a watershed approach • PRM through on-site and in-kind mitigation • PRM through off-site and/or out-of-kind mitigation

22. Wetland Mitigation Mechanisms (2005) Proportion of required wetland mitigation nationwide (43,549 acres) satisfied by permittee-responsible mitigation, purchase of credits from a mitigation bank, payment to an in-lieu-fee program, and by other means.

23. Mitigation Bank Sponsorship (2005)

24. ILF Program Sponsorship (2005)

25. New Provisions for In-lieu Fee Mitigation • May be sponsored only by governmental or non-profit natural resources management entity • Requires a compensatory mitigation planning framework • Less up-front capitalization than banking Maine in-lieu fee program

26. Opportunity: Support the Watershed Approach • The watershed approach • Where available, use an existing watershed plan • Where no such plan is available, use the watershed approach Julie J. Metz Wetland Bank, Woodbridge, VA Bank sponsor: Wetland Studies & Solutions

27. The Watershed Approach • Provides additional flexibility on: • Site selection • Type • Method • Preservation: only in conjunction with restoration, establishment, or enhancement • Unless identified as a priority through the watershed approach • BUT…higher ratios Watershed-based wetland characterization for Maryland’s Nanticoke River and Coastal Bays Watersheds: U.S. FWS & Maryland DNR

28. The Watershed Approach • Can be guided by: • Information on rare, endangered and threatened species and critical habitat • Local ecological reports or studies Middle South Platte River Wetland Mitigation Bank, CO Sponsored by: Land and Water Resources, Inc.

29. Conclusions for conservation non-profits… • Lessons learned from the wetland compensatory mitigation market • Poor track record, both ecologically and administratively • Higher risks and up front investment requirements for banks

30. Questions?