Wetland mitigation banks provide wetland compensatory mitigation “credits” to offset unavoidable permanent loss of existing wetlands from development and construction activities. Wetland mitigation banks are developed by restoring and enhancing existing degraded wetlands on land that historically supported wetland habitats as well as by creating new wetlands within upland areas. Once created, a wetland mitigation bank is owned and operated as a private business by the landowner (aka sponsor), who then sells wetland credits to permittees who are obligated to purchase compensatory mitigation credits for projects that result in permanent loss of wetlands.

Existing wetlands are typically not eligible for mitigation banking sites, unless they are of exceptional watershed value or have rare (state or federally-listed) plants or animals. A degraded wetland can receive credit for wetland banking if sufficient restoration of hydrology and/or vegetation is performed.

Unproductive agricultural lands that flood out in frequent years can be some of the best possible sites for establishing a wetland bank. Areas where farming may be limited due to early season water levels are a tell-tale sign that wetlands are present and historically were most likely seasonally flooded basins that are dry throughout much of the year. Land that has drain tiles or has been ditched to be more conducive to agriculture are also viable candidates.

Unproductive ag lands that flood frequently or sites where wetlands once existed (but have been lost to ditching or tiling) are the easiest sites to restore, especially sites that are entirely contained on a property owned by a single landowner as they have the least complications and are the easiest to get approved.

Degraded wetlands being restored can sometimes involve more management activities than establishing wetland in an ag field, but it can result in a similar expected amount of credit to sell.

Sites that are not acceptable for establishing a wetland bank on include: projects that are enrolled in state or federal programs such as the Wetlands Reserve Program (WRP), sites with stormwater features that reduce the habitat potential of the site (nutrient pollution), and land with existing easements or that were purchased with state or federal money.

Creating a wetland bank does not happen overnight. The time commitment once the decision is made to create the bank is typically a year to year and a half for submitting the required documentation (Prospectus) to having the project approved (MBI). Construction is typically carried out in one to two years with vegetation maintenance and management being more intensive during the first three to 4 years and leveling out as the wetland bank becomes established. Ongoing management will be necessary on most sites but becomes minimal as the project matures.

There are several qualified consultants that can help with mitigation projects including the initial site evaluation, prospectus development, permitting, wetland restoration design and construction, as well as post-construction management and monitoring. Landbridge Ecological and Midwest Natural Resources have experience in establishing wetland mitigation banks. Successful projects are best implemented by a team of professionals with the appropriate certifications, qualifications, and experience within these disciplines.

Once accepted and restored, mitigation banking sites will be forever protected by placing a conservation easement on the property. The landowner still owns the property but the easement has some limitations that protect the wetland from disturbance and future impacts. Landowners can still hunt and use the property for recreational purposes.

The value of wetland banking credits can vary across the state that it is established in. In Minnesota, higher values are typically achieved if the bank is located closer to where more frequent land development occurs like the 7-county metro area of Minneapolis/St. Paul. In general, values for credits being sold can range anywhere from $40,000 to $130,000 per acre depending on site location and market/demand for credits, similar to real estate.

Once a bank is created and credits are released and available for sale, project proposers that are required to purchase compensatory mitigation credits will be able to buy your wetland credits. This can be someone who is putting in a single driveway or a large land development company who is building a development.

Buyers of banking credits have to follow specific siting requirements when deciding where they can buy credits from for their projects. In Minnesota, a buyer of credits needs to first look for a wetland bank that is located in the same minor watershed as their project site. If no banks are located within the same minor watershed as the buyer’s project site, then they can look outside to the major watershed and then eventually the Bank Service Area.

Credit sales must be approved by the WDNR (Wisconsin) or BWSR (Minnesota) under the authority of the Wetland Conservation Act.

The amount of credit produced for any particular site usually depends on the size of the project that is restored but other factors may come into play as well. Typically, the bigger the project the larger the amount of credit produced.
Wetland projects that have historic wetland soils present but the current state is in agriculture, drained or altered by ditching or drain tile will produce the most credits in most circumstances. Enhancing a wetland with existing vegetation can produce credit but is usually accepted at a lesser percentage (2:1, 3:1 or 4:1 typically???). Sites where there is no existence of historic wetland hydrology or soils may receive credit but are not preferred and more difficult to get approved. No credit will be given to open water or existing ponds. Additional credits can be produced from restoring upland vegetation (a buffer) but at a lower percentage. See diagram. (Create an example and use here-have logos of our companies there).