Compensatory Mitigation: What is it?
If you haven’theard, the Alaska Mental Health Trust Authority (AMHTA) announced on December17, 2018 that it finalized its firstconservation agreement with Donlin Gold, LLC to enter into a long-term deed restrictionagreement to preserve just under 2,000 acres of Trust wetlands near Tyonek forwetland compensatory mitigation of 2,800 acres of disturbed wetlands in the MiddleKuskokwim. As a part of this agreement, Donlin Gold paid the Trust $200,000upfront for the ability to purchase a deed restriction in the future and willcontinue to pay $20,000 per year over the next 10 years to maintain thismitigation option until the mine is officially under construction. If the mine comes into fruition, Donlin will pay the Trust $1.3 million to secure 1,933acres Trust’s existing wetlands and limit surface development of the wetlandsas compensatory mitigation for 99 years. All earnings with the agreement willbe used to support programs that serve Alaska Mental Health Trustbeneficiaries.
So what is compensatory mitigation?
The EPA and U.S. Army Corps of Engineers (USACE) revised the definition of Compensatory Mitigation in 2008 as “...the restoration (re-establishment or rehabilitation), establishment (creation), enhancement, and/or preservation of wetlands, streams, and other aquatic resources to offset unavoidable adverse impacts of development after all appropriate and practicable avoidance and minimization efforts have been achieved.”
Meaning that compensatory mitigation allows for companies that areirreversibly changing or adversely affecting the environment on their site toprotect, restore, or enhance wetlands or other aquatic environments in otherlocations to make up for lost habitat and environmental resources.
Generally, thereare three types of compensatory mitigation:
Mitigation Banks - A site, or suite of sites, where resources (e.g., wetlands, streams, riparian areas) are restored, established, enhanced, and/or preserved for the purpose of providing compensatory mitigation for impacts authorized by Department of the Army permits. In general, a mitigation bank sells compensatory mitigation credits to permittees whose obligation to provide compensatory mitigation is then transferred to the mitigation bank sponsor. The operation and use of a mitigation bank are governed by a mitigation banking instrument.
In-lieu fee programs - Defined as a program involving the restoration, establishment, enhancement, and/or preservation of aquatic resources through funds paid to a governmental or non-profit natural resources management entity to satisfy compensatory mitigation requirements for DA permits.
Permittee-Responsible Mitigation - This is an aquatic resource restoration (reestablishment or rehabilitation), establishment (creation), enhancement, and/or preservation activity undertaken by the permittee (or an authorized agent or contractor) to provide compensatory mitigation for which the permittee retains full responsibility. (This is what Donlin Gold is currently pursuing with AMHTA)
In comparison tothe lower 48 with only 5.2% of its surface area classified as wetlands, Alaska’swetlands occupy 43.3 % of the state’s surface area. This creates a unique challengefor development in Alaska which is most likely why Donlin Gold is pursuing thisavenue for mitigation efforts. Donlin Gold did explore other options todirectly impact the Middle Kuskokwim, but those options were not selected astheir final mitigation plan.
Wetlands in the United States (
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If you’re interestedin learning more about compensatory mitigation in Alaska, the EPA and USACE signedand released a Memorandum of Agreement on June 15, 2018 which gave guidance on flexibilities for compensatorymitigation in the state of Alaska including the following six principles:
Avoiding wetlands may not be practicable where there is a high proportion of land in a watershed or region which is jurisdictional wetlands;
Restoring, enhancing, or establishing wetlands for compensatory mitigation may not be practicable due to limited availability of sites and/or technical or logistical limitations;
Compensatory mitigation options over a larger watershed scale may be appropriate given that compensation options are frequently limited at a smaller watershed scale;
Where a large proportion of land is under public ownership, compensatory mitigation opportunities may be available on public land;
Out-of-kind compensatory mitigation may be appropriate when it better serves the aquatic resource needs of the watershed; and
Applying a less rigorous permit review for small projects with minor environmental impacts is consistent with the Section 404 program regulations.
You can find the memorandum document on EPA's website.
If you have any comments on Donlin Gold or want to learn more please reach out to our Environmental Department at Meredith.witte@georgetowntc.com or at 907.274.2195. We will do our best to keep everyone informed on Donlin Gold’s progress.
M Witte
01/09/2019
Featured image by Donlin Gold