Top 4 Purchasing Benefits
If your project’s plan to avoid and reduce adverse impacts to water resources isn’t enough and impacts are unavoidable and above regulatory pre-set thresholds – you will be responsible for compensatory mitigation. In other words, you must compensate for the form and amount of impact the Corps or other regulatory agency determines your project will make (Corps’ Final Compensatory Mitigation Rule).
You have three options when it comes to how to fulfill your compensatory mitigation requirement: 1) purchase mitigation bank credits, 2) purchase in-lieu fee credits, 3) undertake permittee-responsible mitigation. (For a full explanation of these options, see our article, “5 Tips for Successfully Navigating Compensatory Mitigation.”)
The Corps’ preferred mechanism is purchasing credits from a mitigation bank, or in-lieu fee program if no bank is available. Why? Here are five reasons:
1. Purchasing credits saves time and money.
The permit approval process, construction and other tasks involved in creating or restoring a wetland or stream are time-consuming and costly. In addition, permitting, construction, and monitoring will require long term operations and maintenance of the wetland/stream restoration project, possibly up to ten years. The process of purchasing credits could take a relatively short time to complete and involves a few simple steps (obtaining a quote, agreeing on a contract, invoicing/payment, and issuing a sale certificate). In fact, Corps data consistently show that purchasing bank credits can cut permitting time in half.
2. Banks and in-lieu fee programs decrease risk.
A mitigation bank must have an approved mitigation plan and other assurances in place before any credits can be used to offset permitted impacts. Purchasing bank credits reduces some of the risks and uncertainties associated with compensatory mitigation. The 2008 Mitigation Rule also addresses concerns regarding in-lieu fee programs’ past performance and equivalency with the standards for mitigation banks.
3. Banks and in-lieu fee programs assume responsibility for perpetual protection.
When a developer purchases bank credits, all responsibility for mitigation and long-term stewardship and management is legally transferred to the mitigation banker or in-lieu fee program. Once the credits are purchased, the permit holder is free of all regulatory responsibility – all remaining responsibility for the mitigation project lies with the bank or in-lieu fee program. With permittee responsible mitigation the permit holder assumes all responsibility for site preparation, monitoring, reporting, maintenance, management (adaptive and routine), and long-term protection. This process can take 7 to 10 years to complete. Long-term stewardship and management costs and responsibilities continue in perpetuity for permittee-responsible mitigation.
4. Purchasing credits confirms success.
Landowners or developers lacking the know-how in wetland or stream restoration are at greater risk of failing, thereby reducing or eliminating temporal gain of ecological functions by the mitigation. With mitigation bank credits, restoration is performed prior to impacts.
Should you need to purchase credits from a mitigation bank or in-lieu fee program, we can help with the process, from locating eligible credits to negotiating credit pricing. Connect with us to learn more or read about the permittee-responsible mitigation process in our article HERE.
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