Wetland Mitigation Banking: Status and Prospects (CRS Report for Congress)
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| Release Date |
Sept. 12, 1997 |
| Report Number |
97-849 |
| Report Type |
Report |
| Authors |
Jeffrey A. Zinn, Environment and Natural Resources Policy Division |
| Source Agency |
Congressional Research Service |
Summary:
Wetland protection is controversial because the federal government regulates activities on
private
lands and because the natural values at some of these regulated sites are being debated. This
controversy pits property owners and development interests against environmentalists and others
who seek to protect the remaining wetlands. Mitigation banking, which allows a person to degrade
a wetland at one site if a wetland at another site is improved, has been identified as a potential
answer to this shrill and seemingly intractable debate.
Mitigation banking is relatively new, and federal mitigation banking policies continue to
evolve.
It was first endorsed by the Bush Administration. The Clinton Administration subsequently
endorsed the concept in 1993, and the Corps and EPA issued detailed direction to field staff
concurrently. Five federal agencies published final guidance in the Federal Register in
November
1995 providing a framework to support a functioning banking system. In addition, many states have
initiated or are considering banking programs.
Banking can occur only after three steps are taken in the federal process for protecting wetlands.
First, wetland development must be avoided if possible; second, when this it is unavoidable,
impacts must be minimized; and third, impacts that can not be minimized to an acceptable level must
be mitigated. Mitigation banking is an option only when mitigation on-site is not possible. Bank
sponsors create wetland "credits" at a bank site that can be acquired by those who fall within the
purview of these two programs and are required to offset wetland losses, or "debits," at other sites.
Congressional interest is building because mitigation banking appears to be a promising
approach for offsetting wetland degradation and implementing an overall policy goal of "no net
loss." While the recent growth in the number of mitigation banks suggests expanded interest and
support for this approach, several years or more may elapse before success (or failure) at individual
sites can be determined.
This time lapse is one reason why mitigation banking is controversial. Supporters claim that
mitigation banking, when compared with mitigation on-site, provides better-organized planning, an
improved regulatory climate, greater commitment to long-term wetland protection, and more
consolidation of habitat. Opponents are concerned that banking is a loophole and endorses
additional wetland destruction, that some types of wetlands are difficult to create or restore as
thriving ecosystems, and that wetland losses are sometimes allowed before the bank is fully
functional. More generally, supporters view policy flexibility as critical to success, especially for
commercial banks, while critics worry that flexibility will lead to unacceptable losses of wetland
functions and values. Congress is hearing about these benefits and concerns as it considers how
mitigation banking might be incorporated into future wetland protection laws and programs.
