Wetland Banks Provide Environmentally Friendly Regulatory Solutions

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By Laurie Rink, Manager, Mile High Wetlands Group, LLC

 


A new regulatory solution has emerged in Colorado: wetland mitigation banking. Rather than undertaking wetland mitigation in their own hands, project proponents, including both public and private Colorado entities, can now buy credits from professionally operated banks.

Development pressures often result in unavoidable wetland impacts. Public or private development interests who need to impact wetlands must seek prior regulatory approval in the form of a Section 404 permit from the U.S. Army Corps of Engineers. The permit requires that any unavoidable impacts be compensated for by creating new wetlands. Before banks, project proponents were faced with building and maintaining wetlands on their own properties. However, a nationwide study of wetland mitigation found that these projects failed more than fifty-percent of the time. Due in part to this significant failure rate, the government has issued new regulations that encourage the establishment of larger-scale mitigation banks.

Banks are designed to create, restore, and/or enhance large, ecologically important wetland tracts in advance of permitted impacts. Based upon the type, size, and function of the improvements, the bank is authorized by the regulatory/resource agencies to sell a certain number of credits. As part of the sales transaction, the number of credits necessary to satisfy the requirements of a permit holder’s Section 404 permit are debited against the mitigation bank’s assets.

Three banks are currently authorized to sell credits in Colorado. Two are located in the middle South Platte basin and one in the Gunnison basin, while a fourth bank is in the works for the Upper South Platte basin. The author of this article operates the Mile High Wetland Bank, located near Brighton just north of Barr Lake. The Mile High Wetlands Group, LLC, a partnership of local interests, is the bank sponsor developing the 600-acre property to meet regional development needs. The first phase of 32-acres of wetland creation is complete on the ground. In subsequent phases, up to 140 acres of new wetland will be created from pasture ground while 220 acres of low quality wetland will be enhanced to its natural condition. The remaining acreage will be restored as upland buffer to protect the integrity of the wetland ecosystem.

Banks are an environmentally friendly solution to the regulatory requirement for mitigation compensation. Mitigation banks are established in advance of impacts, so there is little to no “ecological lag-time” between when a wetland is lost and another created. Banks can also consolidate many small, isolated wetland mitigation projects into a single, large-scale ecosystem. Banks also have the opportunity to include riparian restoration components as part of an ecosystems approach. The significant technical and financial resources that go into establishing and operating a mitigation bank guarantee a high degree of success.

Banks are also a developer-friendly solution. Often times, on-site mitigation is simply not appropriate given site suitability constraints, potential low functionality, or questionable long-term viability. A substantial amount of time and money can often be saved by purchasing wetland credits rather than building one’s own wetland. Additionally, the risks inherent with habitat development and maintenance are passed on to the bank sponsor.

The Mile High Wetland Bank is currently home to two juvenile nesting bald eagles. Located just five miles from the South Platte River flyway, it soon will be host to even more migratory and resident waterfowl. Both large and small mammals enjoy the open space as they travel between the bank and Barr Lake State Park along the Beebe Draw. The Mile High Wetland Bank will be maintained as wetland open space in perpetuity thanks to a permanent conservation easement that will be donated to a local non-profit entity.