Proposal threatens wetland banks
A private f irm is making big money selling promises about some gator-infested Florida swampland. The Panther Island Mitigation Bank isn’t another land boondoggle, but part of a federal system designed to restore wetlands across the United States.
Panther Island’s owners preserved one of the nation’s last stands of virgin bald cypress, 4 square miles on the western edge of the Everglades where they cleared away invasive plants and welcomed back wood storks, otters and other native flora and fauna.
Banks like this sell “wetlands mitigation credits” to developers for up to $300,000 apiece, offsetting the destruction of marshes by construction projects elsewhere. It’s a billion-dollar industry that has slowed the loss of U.S. wetlands, half of which are already gone.
This uniquely American mix of conservation and capitalism has been supported by every president since George H.W. Bush pledged a goal of “no net loss” of wetlands, growing a market for mitigation credits from about 40 banks in the early 1990s to nearly 1,500 today. Investors include Chevron and Wall Street firms, working alongside the Audubon Society and other environmental groups.
Now the market is at risk. Administrator Scott Pruitt’s Environmental Protection Agency has completed a proposal for implementing President Donald Trump’s executive order to replace the Waters of the United States rule, or WOTUS, with a much more limited definition of what constitutes a protected federal waterway.
The current definition is an overreach that claims federal jurisdiction over “dry creek beds” and “prairie puddles” that are better regulated by the states, Pruitt told a group of farmers and businesspeople Thursday in Lincoln, Neb.
“We’re going to say what it is, but we’re also going to say what it isn’t. We’re proposing that prairie puddles in North Dakota are not waters of the United States, and we’re proposing that ground water is not water of the United States,” Pruitt said. “That’s how you save the economy a billion dollars.”
The EPA said the proposal now faces months of reviews before being released for public comment, but experts in mitigation are alarmed.
“It would destroy wetland mitigation banking at the federal level,” said Royal Gardner, a professor at Florida’s Stetson University College of Law.
The Associated Press is the first outlet to report comprehensively on the potential harm this proposal could bring to the billion-dollar wetlands mitigation banking industry. The EPA did not specifically address AP questions about how redefining waterways could affect it.
Wetlands are protected under the Clean Water Act because they are vital to the nation’s water quality. Their dense vegetation helps filter out toxins as water flows through. Wetlands provide key fish and bird habitat, and protect coastal land from hurricanes.
Mitigation banks are not a panacea, but they are the government’s preferred method of protecting wetlands from damage from development, a preference that has fueled the market for mitigation credits. The system began decades ago under the Army Corps of Engineers, but it initially wasn’t well-designed, and the market failed to take off.
That began to change after 2001, when the National Research Council identified a chief problem: The Corps was letting developers who lacked the necessary expertise design and build the restoration projects. The Corps and EPA revamped the system in 2008, requiring developers to collaborate with conservation experts, and to get the science right before selling any credits.