WETLANDS MITIGATION
| Jurisdiction | United States |
(Jan 2002)
WETLANDS MITIGATION
Denver Regulatory Office,
Army Corps of Engineers
Littleton, Colorado
Federal Register/Vol. 65, No. 216/Tuesday, November 7, 2000/Notices
Federal Guidance on the Use of In-Lieu-Fee Arrangements for Compensatory Mitigation Under Section 404 of the Clean Water Act and Section 10 of the Rivers and Harbors Act
AGENCIES: Corps of Engineers. Department of the Army, DOD; Environmental Protection Agency; Fish and Wildlife Service, Interior; and National Marine Fisheries Service, National Oceanic and Atmospheric Administration, Commerce.
ACTION: Notice.
SUMMARY: The Army Corps of Engineers (Corps), Environmental Protection Agency (EPA), Fish and Wildlife Service (FWS) and National Marine Fisheries Service (NMFS) are issuing final policy guidance regarding the use of in-lieu-fee arrangements for the purpose of providing compensation for adverse impacts to wetlands and other aquatic resources. Compensatory mitigation projects are designed to replace aquatic resource functions and values that are adversely impacted under the Clean Water Act Section 404 and Rivers and Harbors Act Section 10 regulatory programs. These mitigation objectives are stated in regulation, the 1990 Memorandum of Agreement on mitigation between Environmental Protection Agency (EPA) and the Department of the Army, the November 28, 1995, Federal Guidance on the Establishment, Use and Operation of Mitigation Banks ("Banking Guidance"), and other relevant policy. The advent of in-lieu-fee approaches to mitigation has highlighted the importance of several fundamental objectives that the agencies established for determining what constitutes appropriate compensatory mitigation. The purpose of this memorandum is to clarify the manner in which in-lieu-fee mitigation may serve as an effective and useful approach to satisfy compensatory mitigation requirements and meet the Administration's goal of no overall net loss of wetlands. This in-lieu-fee guidance elaborates on the discussion of in-lieu-fee mitigation arrangements in the Banking Guidance by outlining the circumstances where in-lieu-fee mitigation may be used, consistent with existing regulations and policy.
EFFECTIVE DATE: The effective date is October 31, 2000.
FOR FURTHER INFORMATION CONTACT: Mr. Jack Chowning (Corps) at (202) 761-4614; Ms. Lisa Morales (EPA) at (202) 260-6013; Mr. Mark Matusiak (FWS) at (703) 358-2183; Ms. Susan-Marie Stedman (NMFS) at (301) 713-2325.
SUPPLEMENTARY INFORMATION: This notice publishes interagency guidance regarding the use of in-lieu-fee arrangements for the purpose of providing compensation for adverse impacts to wetlands and other aquatic resources. Any comments or questions on the document may be directed to the persons listed above in the section entitled: FOR FURTHER INFORMATION CONTACT.
Dated: October 20, 2000.
Michael L. Davis, Deputy Assistant Secretary (Civil Works), Department of the Army.
Dated: October 20, 2000.
Robert H. Wayland III, Director, Office of Wetlands, Oceans, and Watersheds, Environmental Protection Agency.
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Dated: October 31, 2000.
Jamie Clark, Director, Fish and Wildlife Service, Department of the Interior.
Dated: October 25, 2000.
Scott B. Gudes, Deputy Under Secretary for Oceans and Atmosphere, National Oceanic and Atmospheric Administration, Department of Commerce.
Memorandum to the Field
Subject: Federal Guidance on the Use of In-Lieu-Fee Arrangements for Compensatory Mitigation Under Section 404 of the Clean Water Act and Section 10 of the Rivers and Harbors Act
I. Purpose
Compensatory mitigation projects are designed to replace aquatic resource functions and values that are adversely impacted under the Clean Water Act Section 404 and Rivers and Harbors Act Section 10 regulatory programs. These mitigation objectives are stated in regulation, the 1990 Memorandum of Agreement on mitigation between Environmental Protection Agency (EPA) and the Department of the Army, the November 28, 1995, Federal Guidance on the Establishment, Use and Operation of Mitigation Banks ("Banking Guidance"), and other relevant policy. The advent of in-lieu fee approaches to mitigation has highlighted the importance of several fundamental objectives that the agencies established for determining what constitutes appropriate compensatory mitigation. The purpose of this memorandum is to clarify the manner in which in-lieu-fee mitigation may serve as an effective and useful approach to satisfy compensatory mitigation requirements and meet the Administration's goal of no overall net loss of wetlands. This in-lieu-fee guidance elaborates on the discussion of in-lieu-fee mitigation arrangements in the Banking Guidance by outlining the circumstances where in-lieu-fee mitigation may be used, consistent with existing regulations and policy.
II. Background
A. "In-lieu-fee" mitigation occurs in circumstances where a permittee provides funds to an in-lieu-fee sponsor instead of either completing project specific mitigation or purchasing credits from a mitigation bank approved under the Banking Guidance.
B. A fundamental precept of the Section 404(b)(l) Guidelines is that no discharge of dredged or fill material in waters of the U.S. may be permitted unless appropriate and practicable steps have been taken to minimize all adverse impacts associated with the discharge. (40 CFR 230.10(d)) Specifically, the Section 404(b)(l) Guidelines establish a mitigation sequence, under which compensatory mitigation is required to offset wetland losses after all appropriate and practicable steps have been taken to first avoid and then minimize wetland impacts. Compliance with these mitigation sequencing requirements is an essential environmental safeguard to ensure that CWA objectives for the protection of wetlands are achieved. The Section 404 permit program relies on the use of compensatory mitigation to offset unavoidable wetlands impacts by replacing lost wetland functions and values.
C. The agencies further clarified their mitigation policies in a Memorandum of Agreement (MOA) between the EPA and the Department of the Army Concerning the Determination of Mitigation under the Clean Water Act Section 404(b)(l) Guidelines (February 6, 1990). That document reiterates that the Clean Water Act and the Guidelines set forth a goal of restoring and
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maintaining existing aquatic resources. The Corps will strive to avoid adverse impacts and offset unavoidable adverse impacts to existing aquatic resources, and for wetlands, will strive to achieve a goal of no overall net loss of values and functions. Moreover, the MOA clarifies that mitigation "should be undertaken, when practicable, in areas adjacent or contiguous to the discharge site," and that "if on-site compensatory mitigation is not practicable, off-site compensatory mitigation should be undertaken in the same geographic area if practicable (i.e., in close proximity and, to the extent possible, the same watershed)." As outlined in the MOA, the agencies have also agreed that "generally, in-kind compensatory mitigation is preferable to out-of-kind." The MOA further states that mitigation banking may be an acceptable form of compensatory mitigation. The agencies recognize the general preference for restoration over other forms of mitigation, given the increased chance for ecological success.
D. Pursuant to these standards, project-specific mitigation for authorized impacts has been used by permittees to offset unavoidable impacts. Project-specific mitigation generally consists of restoration, creation, or enhancement of aquatic resources that are similar to the aquatic resources of the impacted area, and is often located on the project site or adjacent to the impact area. Permittees providing project specific mitigation have a U.S. Army Corps of Engineers (Corps) approved mitigation plan detailing the site, source of hydrology, types of aquatic resource to be restored, success criteria, contingency measures, and an annual reporting requirement. The mitigation and monitoring plan becomes part of the Section 404 authorization in the form of a special condition. The permittee is responsible for complying with all terms and conditions of the authorization and would be in violation of their authorization if the mitigation did not comply with the approved plan.
E. In 1995, the agencies issued the Banking Guidance. Consistent with that guidance, permittees may purchase mitigation credits from an approved bank. Mitigation banks will generally be functioning in advance of project impacts and thereby reduce the temporal losses of aquatic functions and values and reduce uncertainty over the ecological success of the mitigation. Mitigation banking instruments are reviewed and approved by an interagency Mitigation Banking Review Team (MBRT). The MBRT ensures that the banking instrument appropriately addresses the physical and legal characteristics of the bank and how the bank will be established and operated (e.g., classes of wetlands and/or other aquatic resources proposed for inclusion in the bank, geographic service area where credits may be sold, wetland classes or other aquatic resource impacts suitable for-compensation, methods for determining credits and debits). The bank sponsor is responsible for the operation and maintenance of the bank during its operational life, as well as the long-term management and ecological success of the wetlands and/or other aquatic resources, and must provide financial assurances.
F. The Banking Guidance describes in-lieu-fee mitigation as follows: "... in-lieu-fee, fee mitigation, or other similar arrangements, wherein funds are paid to a natural resource management entity for implementation of either specific or general wetland or other aquatic resource development project, are not considered to...
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