Wetland mitigation banks, providing an exemption from emergency rule procedures, providing an exemption from rule-making procedures, and requiring the exercise of rule-making authority

Under current law, there are three methods by which wetland mitigation may be accomplished: 1) purchasing credits from a mitigation bank located in this state;

2) participating in the in lieu fee subprogram; or 3) completing mitigation within the same watershed or within one-half mile of the site of the discharge. A mitigation bank is a system of accounting for wetland loss and compensation in which sites where wetlands are restored, enhanced, created, or preserved generate credits that may be applied or purchased in order to compensate for adverse impacts to other wetlands. Under current law, DNR must approve the establishment of a mitigation bank.

This bill changes the first method of wetland mitigation by limiting credit purchases to only a mitigation bank located in the same compensation search area as the wetland impacted by the discharge, if available. Under the bill, a compensation search area is an area that includes the geographic management unit of a wetland impacted by a discharge, the county of the impacted wetland, and the area within a 20-mile radius from the impacted wetland. Under the bill, a geographic management unit is one of the 22 statewide management units established by DNR based on the major river basins of the state. If no available mitigation bank is located in the same compensation search area as the wetland impacted by the discharge, the bill allows credit purchases to be made from a mitigation bank located within 50 miles of the wetland impacted by the discharge.

If no available mitigation bank is located within 50 miles of the impacted wetland, the bill allows credit purchases to be made from a mitigation bank in the same basin as the wetland impacted by the discharge, meaning the Lake Michigan Basin, the Lake Superior Basin, or the Mississippi River Basin. If no available mitigation bank is located in the same basin as the wetland impacted by the discharge, the bill allows credit purchases to be made from a mitigation bank anywhere in the state.

This bill requires DNR to establish by rule financial assurance requirements for the construction of mitigation projects by mitigation banks. The bill also establishes the means by which a mitigation bank that has not yet completed construction of a mitigation project and has not been approved by DNR (developing mitigation bank) may sell the credits that the mitigation bank estimates it will have once the mitigation project is complete. Under the bill, a developing mitigation bank may sell these credits if it is in compliance with DNR's financial assurance requirements and if it follows a specific schedule for release of the credits that is established in the bill.