Wetland Mitigation Banking

Compensatory mitigation is the last step in the three-step approach of (1) avoidance of impacts to wetlands, (2) minimization of impacts to wetlands, and (3) compensation.  The purpose of mitigation is to compensate for unavoidable impacts to wetlands.

There are occasions when wetland losses are unavoidable. When these situations arise, the wetland that is lost due to impact must be replaced. The majority of these wetland replacements occur individually, resulting in small wetland restoration or creation attempts either on the same property as the wetland loss, or within the same county or watershed as the filled wetland. IDEM requires that wetland replacement occur within a year of the wetland loss.

Wetland Mitigation Banking allows a sponsor (e.g., individual, corporation, governmental entity etc.), to restore a large wetland area in advance of impacts with the expectation that the sponsor may use or sell these "wetland credits" at a future date. Under certain circumstances, the sponsor may be allowed to use or sell a percentage of the wetland credits before the wetland is restored.

Wetland Mitigation Banking, because of its up-front nature, its increase in restoration size, and its commitment to increased planning and placement considerations, has the potential to improve the performance of wetland compensatory mitigation. However, it also has a potential for misuse.

In an effort to foster an environment welcoming of wetland mitigation banking while minimizing potential problems, IDEM, the U.S. Army Corps of Engineers, the Indiana Department of Natural Resources (IDNR), the Natural Resource Conservation Service (NRCS), the U.S. Fish and Wildlife Service (USFWS), and the U.S. Environmental Protection Agency (USEPA) have developed the Interagency Coordination Agreement on Mitigation Banking in Indiana [PDF]. This agreement governs how mitigation banks are created and operated within Indiana.

If you are interested in developing and starting a wetland bank in Indiana, contact by email at info@idem.in.gov.

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