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Rule Information and Background

Wetland Mitigation Banks, Chapter 173-700 WAC

The Department of Ecology (Ecology) adopted a rule for wetland mitigation banks. The rule was filed in the State Register on September 3, 2009, WSR 09-19-013. The purpose of the rule is to provide an efficient, predictable framework to certify, operate, and monitor wetland mitigation banks (banks) across the state.

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How does the state wetland mitigation bank rule change existing practices?

Current mitigation sequencing practices of avoidance, minimization, and compensation still apply. The wetland mitigation bank rule (WAC 173-700) focuses on procedures for certifying banks as well as their implementation process. Essentially, the rule adds another tool to the regulatory toolbox for protecting wetlands.

Background Information on the Rule

Rule Adoption Process

The proposed rule was published for public review and comment in the Washington State Register on March 18, 2009. Ecology also issued a Draft Environmental Impact Statement (DEIS) under the State Environmental Policy Act, a Small Business Economic Impact Statement (SBEIS), and a Preliminary Cost-Benefit Analysis (CBA) as part of the public comment process.

Ecology reviewed all of the comments received during the public comment period. The agency's responses to those comments are published in a Concise Explanatory Statement (CES) and as part of the Final Environmental Impact Statement (FEIS). All rule-making documents are posted on Ecology's rules web page.

Rule Development Process

Ecology used a negotiated rule process to begin the rule process in 1999. A negotiated rule group was formed. The group played a pivotal role by adding diverse viewpoints from local, state, and federal agencies; environmental interests; private bank developers; agricultural concerns; and businesses. The group helped develop the initial negotiated draft rule text. Unfortunately, this first draft rule was withdrawn due to budget cuts in June 2001.

In 2004, the state legislature authorized the wetland mitigation banking program to test that negotiated rule text through a pilot program; under the Administrative Procedures Act (Chapter 34.05 RCW), an agency may test a rule before it is formally adopted. The pilot program focused on essentially two processes:

  • How will mitigation banks be certified? and
  • How will mitigation banks be implemented?

During the testing of the pilot program, an advisors group was formed. The members included local, state, and federal agencies; environmental interests; private bank developers; agricultural interests; and businesses. During the pilot program, the advisors group analyzed the negotiated draft rule text and how it was working and being implemented by the pilot projects. The group worked together for over a year and identified necessary revisions. The proposed rule text was published for public comments in April 2009. MORE on the pilot program

General Information on Banking

How are wetlands regulated now?

Wetlands are regulated under a number of statutory authorities. Regulatory agencies from the federal, state and local governments all have an interest in overseeing wetland protection.

Under current regulatory programs, parties seeking permits for activities that affect wetlands must first avoid and then minimize those effects. Any remaining damage must be compensated. Historically, the regulatory preference for compensation has been on-site creation, restoration, or enhancement of a wetland. These mitigation efforts have resulted in several smaller, "postage stamp" wetlands that have had limited success in reaching full function potential.

The sequencing of avoidance, minimization, and compensation still applies prior to using credits from any bank. However, in contrast to traditional mitigation activities, banks are in place prior to any wetland impacts. Credits are generated by this up-front activity. Those credits can then be used by the sponsor or sold to another party to offset impacts to wetlands that occur in other locations. Again, only impacts that cannot be avoided or minimized are available for compensation through purchase of bank credits.

Elements of mitigation banking

  • Service areas - A service area is loosely defined as the geographic area in which a bank can reasonably provide compensation for unavoidable impacts to wetlands. The size of a service area can vary depending upon the wetland functions being provided, the type of damage anticipated to be offset, local and regional conditions, etc.
  • Determination of credits - Considerations for determining the number of credits a bank can generate include acreage, category type, and gains in function.
  • Release of credits - Guidelines for releasing credits are developed as part of the certification process and are outlined in the bank's mitigation banking instrument. Credit releases are tied to gains in performance such as wetland structure and function.
  • Streamlined process - The law requires that the state certification process be consistent with federal guidance regarding banks. The federal agencies adopted ‘Compensatory Mitigation for Losses of Aquatic Resources; Final Rule in April 2009 (33 CFR Part 332 and 40 CFR Part 230). This rule outlines federal requirements for wetland mitigation banks. To streamline the processing of bank proposals, Ecology and the US Army Corps of Engineers combine the state and federal review processes, as much as possible. This allows an applicant to receive federal approval and state certification in one process.

 

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