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After Turbulent Year, Mitigation Bankers Meet In Denver

The annual National Mitigation & Ecosystem Banking Conference begins today in Denver and runs through the end of the week, capping a turbulent year that saw the emergence of controversial voluntary mitigation programs and the deployment of a new mitigation strategy by the Department of the Interior. Here are some of the issues we’ll be following.

6 May 2014 | For the wetland and conservation banking sector, the conference taking place this week in Denver is a big deal. We’ve created a coverage page that we’ll be updating with videoblogs and updates, and you can also follow us on Twitter for the latest developments.

Here is a brief run-down of the issues we’ll be covering this week.

Is the Lesser Prairie Chicken a Bellwether For Other Candidate Species?

The lesser prairie chicken was a candidate species for nearly 15 years before it was finally listed as threatened under the Endangered Species Act (ESA) in March. But the bird’s listing decision isn’t clear-cut. Along with the listing, a special 4 (d) rule was finalized that exempts those who participate in approved conservation initiatives from the ESA’s regulatory measures. Instead, approved conservation primarily falls under the Lesser Prairie Chicken Range-wide Conservation plan, which is a voluntary plan put together by multiple entities that have a stake in the prairie chicken’s listing status. The range-wide plan has been criticized by some as lacking in the quality of its conservation and charged with using untested methods. Most of the criticism comes from the conservation banking industry although conservationists have raised objections as well.

But the situation of the prairie chicken – the voluntary range-wide conservation plan, a listing status and the special 4(d) rule – could have implications for a slew of other candidate species. (Upward of 250 species are still awaiting federal listing.) At sessions on the lesser prairie chicken and the greater sage-grouse, a current candidate species, we’ll be listening for implications of the recent decision.

The DOI’s New Mitigation Strategy

The Department of Interior is adopting a new approach to mitigation with plans to scale up to deal with big picture problems like climate change.

What does this mean for mitigation banking? The new strategy lays out key principles it will focus on in order to achieve landscape-level mitigation, and explicitly backs compensatory mitigation mechanisms. The strategy is in its early days, however, and there are a lot of moving pieces involved. It’s likely to be a prime topic of conversation among bankers and regulators this week.

What the Proposed CWA Rule Means for Banking

Another policy change that could have an effect on bankers – although, again, it’s in very early stages – is the Environmental Protection Agency (EPA) and Army Corps of Engineers’ proposed rule on US waters protected under the Clean Water Act (CWA). Basically, the rule isn’t expanding on the CWA’s authority but rather trying to provide clarity on which streams, wetlands and tributaries fall under the law’s jurisdiction.

For mitigation bankers, first impressions of the rule were positive, with some bankers believing clearer definitions of waters could streamline the lengthy permitting process and lead to more efficient mitigation.

But the rule is far from final and the industry is at least somewhat expecting alterations before it’s made final. Bankers may be taking a ‘wait and see’ approach with the rule before acting on it.

Voluntary Protection and Banking: Can They Peacefully Coexist?

Are voluntary initiatives having a positive impact on species recovery and conservation? Do they undermine compensatory mitigation? Or can the two complement one another?These are questions likely to find their way into this year’s conference especially with the controversy surrounding the prairie chicken’s voluntary plan and the decision to use a 4(d) rule.

NGOs are participating in and even initiating voluntary measures that would proactively protect species before they’re listed. The Environmental Defense Fund’s creation of habitat exchanges are one example.

Developers, energy interests and landowners are becoming more involved in voluntary mitigation as well, since an ESA listing status would complicate their operations. The prairie chicken’s range-wide plan and the Range-wide Oil and Gas Conservation Agreements with Assurances are examples of collaborative plans between oil and gas companies, landowners and state agencies supporting proactive conservation actions.

The primary argument against voluntary mitigation is it lacks the rigor and quality of compensatory mitigation mechanisms like mitigation banking. Bankers argue that banks can provide high quality conservation that’s funded in perpetuity whereas the voluntary initiatives can’t offer this certainty.

Plenty of NGOs will be on hand at the NMEBC to discuss the issue. In fact, a Wednesday session will discuss compensatory mitigation from the NGO perspective.

The Usual Suspects

Finally, there are the issues that surface every year at the conference – the big one being progress made regarding the 2008 Mitigation Rule. The Legislative and Regulatory update on the meeting’s last day will address this topic and more.

Ecosystem Marketplace will be there to provide analysis on these topics and those that emerge as the conference unfolds. Stay tuned!

 

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