Let us first address the question: What exactly is Wetland Mitigation Banking? The process of mitigation banking involves restoring, preserving, and providing compensation for the negative impacts occurring to wetlands, streams, or other aquatic areas caused by developing.
There is a system of credits and debits in place that was devised to ensure that ecological loss would be compensated for by preservation, so as to avoid net loss to the environment. Mitigation banks consist of four components: bank sites, bank instruments, interagency review teams, and the service area. The bank site is the physical property that is being preserved and the bank instrument is the agreement between the owners of that preserved plot of land and the regulators who make
sure that everything is being managed accordingly.
The service area is the plot of land that is to be developed so long as the bank site is compensating for all impacts. These impacts are authorized by Section 404 of the Clean Water Act, which establishes the parameters for the discharge of dredged or fill material into waters of the U.S. In other words, developers require credits to continue building outside of wetland areas, which accordingly are considered debits.
The following question becomes: Who runs or operates these banks? Bank sponsors are individuals or entities who work to develop the wetlands that will be used for mitigation banking and they are responsible for the cost of development and the ongoing maintenance of the wetland. The sponsors must go through the process of developing a mitigation plan, making a formal proposal, and then waiting for the determination of whether or not the plan can provide appropriate compensatory mitigation. As with any business, mitigation banks deal with product and service. In their specific case, the products are the credits and the service is the transference of liability for mitigation compliance. With a traditional bank, cash is the asset to be loaned to customers but in the case of a mitigation bank the credits are the assets that can be sold to those who are seeking mitigation debits. The Southern United States, especially Florida due to the Everglades and similar types of land, has had a lot of Mitigation Bank activity in the last ten years. In more recent years, there has been a significant and rapid loss of existing wetlands in Florida due to development. Chapter 373.4135, Florida Statutes states: “Mitigation banks and offsite regional mitigation should emphasize the restoration and enhancement of degraded ecosystems and the preservation of uplands and wetlands as intact ecosystems rather than alteration of landscapes to create wetlands. This is best accomplished through restoration of ecological communities that were historically present.
Florida has an aggressive state level permitting program that requires a state and §404 permit. The Florida specific program regulates dredging and filling in wetlands and is broader than the federal program. It regulates the alteration of uplands as well, which can affect surface water flows and isolated wetlands that fall outside of federal jurisdiction.
Since former President George HW Bush pledged “no net loss” of U.S. Wetlands, most republicans and democrats have supported this fusion of conservation and capitalism. Each Party has had the general understanding that if a company damages the natural environment, it shall be responsible for offsetting negative impacts. While mitigation banks are not a cure-all, they have in the past served as the preferred governmental method to protect wetlands from developmental damages and give people the opportunity to turn their green land into potential goldmines.