Mitigation Bank

Status Update

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The City of Bellingham’s mitigation bank application remains strong with no significant concerns other than a delay in the agency review timeline. While this delay was largely due to a shortage in federal agency staffing, we are hopeful additional federal staffing added in 2023 will hasten future reviews.

The City is continuing to prepare Mitigation Banking Instrument (MBI) documents for our first mitigation bank site, the Bear Creek Corridor Mitigation Bank Site. Since October 2021 the City has achieved the following milestones:

  1. Obtained acceptance of critical area mapping and characterization.
  2. Received an invitation to begin preparing the first batch of MBI Appendices.
  3. Initiated Whatcom County mitigation bank permit approval.

The City is preparing the eight MBI Appendices and will submit them for sequential approval throughout 2023.

The City is preparing Mitigation Banking Instrument (MBI) documents for our first mitigation bank site, the Bear Creek Corridor Mitigation Bank Site. Although the agencies are actively reviewing our submittals, we anticipate their review process will take longer than expected, delaying our scheduled 2022 bank opening. We will provide an update when more information becomes available. 

The City’s bank application has reached three milestones:

  1. On July 7, 2020, the public comment period concluded per the Joint Public Notice issued by the Department of Ecology and the Army Corps of Engineers (Co-Chairs).
  2. On August 19, 2020, we received a positive Initial Evaluation letter from the Co-Chairs. The Co-Chairs determined that the City’s bank application is ecologically appropriate and has the potential to provide appropriate compensatory mitigation for future development projects.
  3. On November 19, 2020, the Co-Chairs held a virtual kick-off meeting with tribal, local, state, and federal entities with a substantive interest in the establishment and operation of the City’s proposed bank. 

The positive Initial Evaluation letter and kick-off meeting advanced the City’s bank application into the next phase of the certification process, developing the draft Mitigation Banking Instrument (MBI). This document will describe the bank’s physical and biological features, legal structures, and how it will be established and operated. The City is on schedule to submit this document to the Interagency Review Team (IRT) in the first quarter of 2022.

In April 2018, the City submitted our Bellingham Umbrella Mitigation Bank application to the Interagency Review Team (IRT) Co-chairs, the US Army Corps of Engineers and Washington Department of Ecology. On, April 16, 2020, the City received a completeness determination from both agencies. 

This completeness determination initiates the first of two review phases. The first phase is a review of the prospectus and serves as the IRT’s initial determination of key issues. The IRT is composed of the Co-chairs and representatives from federal, tribal, state, and local agencies. During this first phase, the IRT will conduct a public review process, starting with a public notice.

The second review phase is a review of the mitigation banking instrument (MBI). This review will occur once the IRT accepts the prospectus and the City submits a draft MBI. The purpose of the MBI is to detail the physical characteristics, legal obligations, operational procedures, monitoring, and maintenance requirements for the bank. Review of the MBI generally takes two years and includes a public review process. If approved by the IRT, the MBI will represent a formal banking agreement between the regulatory agencies and the City.

The City is committed to expediting review and approval processes. We look forward to comments and feedback generated through this process to ensure the resulting bank supports watershed functions and meets the needs of our community.

Overview

A primary component of the City’s mitigation program will be a Mitigation Bank. The City conducted extensive analysis to determine how best to provide ecologically appropriate and functional mitigation for impacts anticipated to occur over the next 10 years.

As a result, the proposed Mitigation Bank includes:

Background

Traditionally, a project with unavoidable wetland, stream, or habitat impacts is responsible for completing their own mitigation activities. This is often referred to as “permittee-responsible” mitigation. Unfortunately, permittee-responsible mitigation sometimes results in high costs, high rates of failure, and inefficient land use.  A mitigation bank is an alternative approach that offers Bellingham the opportunity to complete mitigation in a way that better reflects community values. In addition, federal and state agencies now prefer the use of mitigation banks.

The City’s proposed mitigation bank builds on previous foundational efforts. In 2012, the City completed a review of mitigation program feasibility. The resulting City of Bellingham Mitigation Program Review and Recommendations report (Northwest Ecological Services LLC) recommended implementing an in-lieu fee program. Subsequently, the City worked with a team of consultants to complete the science-based 2015 Habitat Restoration Technical Assessment (Environmental Science Associates, Northwest Ecological Services, LLC; and Veda Environmental). This document identified and analyzed the City’s existing habitat conditions and future restoration opportunities in preparation for pursuing an in-lieu fee program or mitigation bank. In 2016, the City contracted with Water & Land Natural Resource Consulting, LLC to complete ecological and economic analyses, confirm the appropriate mitigation program type, and prepare a mitigation program prospectus for agency submittal. As a result of this work, the City decided to pursue a mitigation bank rather than an in-lieu fee program.

The term “mitigation” means to lessen the severity of an action. When a development project proposes impacts to wetlands, streams, and habitat areas; agencies require the project “mitigates” these impacts. Mitigation is done by avoiding, minimizing, and compensating for the impact.

Mitigating impacts is important because wetlands, streams, and habitat areas are central to wise land use. These resources are shared assets that benefit the community as a whole. They provide valuable functions for our community including flood control, ground water recharge, water quality improvements, erosion control, recreation, education, and habitat for commercially important species.

The desire and need to protect Bellingham’s ecological assets such as wetlands, streams, and habitat areas is reflected in numerous policies and regulations including Bellingham’s Critical Areas Ordinance (CAO), Shoreline Master Program (SMP), Comprehensive Plan, and the City Council 2009 Legacies and Strategic Commitments. These values are supported in federal and state laws including the federal Clean Water Act (CWA), the federal Endangered Species Act (ESA), the state Growth Management Act (GMA), the state Shoreline Management Act (SMA), the State Hydraulic Code (Hydraulic Code), state Water Pollution Control Act, and the State Environmental Policy Act (SEPA).

As with traditional mitigation, a project proponent must first demonstrate they have avoided and minimized wetland and stream impacts to the maximum extent practicable according to a series of steps called “mitigation sequencing.” 

These steps are defined in the SEPA implementing rules both Chapter 197-11-768 Washington Administrative Code (WAC) and City of Bellingham Critical Areas Ordinance (CAO), Bellingham Municipal Code (BMC) 16.55.​250.

Mitigation Sequencing

  1. Avoiding the impact altogether by not taking a certain action or parts of an action
  2. Minimizing impacts by limiting the degree or magnitude of the action and its implementation, by using appropriate technology, or by taking affirmative steps to avoid or reduce impacts
  3. Rectifying the impact by repairing, rehabilitating, or restoring the affected environment
  4. Reducing or eliminating the impact over time by preservation and maintenance operations during the life of the action
  5. Compensating for the impact by replacing, enhancing, or providing substitute resources or environments
  6. Monitoring the impact and taking appropriate corrective measures

After completing steps 1 through 4, if a project still has unavoidable impacts the project proponent must provide mitigation. If the project is in a bank “service area” with available credits, the project proponent can potentially buy bank credits to fulfill their mitigation obligations. 

Regional and National Use
Mitigation programs, especially mitigation banks, have been widely used throughout the Midwestern and Eastern United States. Although mitigation programs are relatively new in Washington State, there are several examples of each in the Puget Sound region. 

Mitigation Banks
There are over 1,000 approved banks in the United States. As of summer 2018, the Washington State Department of Ecology lists 17 state/federally approved and four pending mitigation banks in Washington State. Only one bank is approved for use in Whatcom County: the Lummi Nation Wetland and Habitat Mitigation Bank. Two banks are approved for use in Skagit County: Nookachamps Wetland Mitigation Bank and the Skagit Environmental Bank.

In-Lieu Fee (ILF) Programs
There are less than 100 approved ILF programs in the United States. As of summer 2018, the Washington State Department of Ecology lists three state/federally approved ILF programs in Washington State. The King County Mitigation Credit Program was approved in 2012 and was the first ILF program approved in Washington State under the 2008 Federal Rule. King County’s program is being used as a template for future programs.

Additional Resources

Contacts

Analiese Burns
Habitat and Restoration Manager
Public Works Natural Resources
acburns@cob.org
(360) 778-7968

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