Mitigation banking is a process in which large areas of existing wetlands and/or uplands are restored and/or enhanced to mitigate, or offset, the loss of other wetlands or surface waters that are destroyed to make room for new homes, businesses, roads, utilities or other activities.  In rare instances, wetlands may also be created as part of a mitigation bank.

Under Florida law, a mitigation bank is defined as a project undertaken to provide “credits” to offset adverse impacts to wetlands or other surface waters that occur as part of a permitted project.

In the St. Johns River Water Management District’s jurisdiction, mitigation banks are intended to be used to minimize the uncertainty associated with traditional mitigation practices and to provide greater assurance of mitigation success. Consolidating multiple mitigation projects into larger contiguous areas should provide greater assurance that the mitigation will yield long-term, sustainable, regional ecological benefits. Rather than altering the landscape to create wetlands, mitigation banks should emphasize restoration and enhancement of degraded ecosystems and the preservation of uplands and wetlands as intact ecosystems. This is best accomplished through restoration of ecological communities that were historically present. Mitigation banks are encouraged in or adjacent to areas of national, state, or regional ecological significance, provided that the area in which the mitigation bank is proposed is determined appropriate and the bank meets all applicable permitting criteria.

The Environmental Reorganization Act of 1993 (Section 373.4135, Florida Statutes [F.S.]) directed the Florida Department of Environmental Protection (FDEP) and the water management districts (WMDs) to “encourage and participate in the establishment of private and public regional mitigation areas and mitigation banks” and to adopt rules governing mitigation banking throughout the state.

The mitigation banking law was revised in 1996 and portions of existing rules were placed in Section 373.4136, F.S. Currently, specific rules and guidelines for mitigation banks within the St. Johns River Water Management District (SJRWMD) are found in SJRWMD’s Applicant’s Handbook: Management and Storage of Surface Waters (subsection 12.4).

There are three basic requirements:

1. The mitigation bank plan must be able to meet the ecological criteria cited in law.
2. The banker must be able to show that he/she has sufficient legal interest in the property to operate the bank.
3. The banker must be able to show that he/she can meet the financial responsibility requirements for mitigation banks.

      Yes. Any water management district (WMD) may construct, operate, manage, and maintain a mitigation bank after obtaining a mitigation bank permit from the Florida Department of Environmental Protection. However, certain provisions apply only to the WMDs and are contained in Rule 62-342.850, Florida Administrative Code (F.A.C.). A WMD may apply to establish a mitigation bank by submitting a mitigation bank plan and meeting the applicable permitting criteria in one of the following formats:

• A mitigation bank plan identifies one or more parcels of lands to be acquired for mitigation site(s).
• A mitigation bank plan identifies one or more parcels of land in which the WMD has a legal or equitable interest.

Local governments or other public agencies may also set up a mitigation bank after obtaining a permit from the appropriate WMD.

      Florida law and the Applicant’s Handbook: Management and Storage of Surface Waters establish the criteria by which a mitigation bank proposal must be judged. Persons interested in establishing a mitigation bank are encouraged to contact the District for a pre-application meeting. 

      In general terms, one mitigation credit is equal to the ecological value gained by the successful creation of one acre of wetlands. More specifically, Florida law defines a credit as a standard unit of measure, which represents the increase in ecological value resulting from restoration, enhancement, preservation, or creation activities.

      SJRWMD can issue either a mitigation bank conceptual approval or a mitigation bank permit.

Conceptual approval estimates the potential credits that could be awarded to a future mitigation bank permit, given the appropriate legal, financial, and detailed ecological information. A conceptual approval does not approve any construction or release of credits. It is valid for five years from the date of issuance.

A mitigation bank permit authorizes the development and operation of a mitigation bank and specifies the rights and responsibilities of a banker and SJRWMD for the implementation, management, maintenance, and operation of the mitigation bank.These permits are perpetual unless revoked or modified. However, the permit automatically expires in the first five years of the permit, if,

• The banker has not recorded a conservation easement or conveyed fee simple interest over the real property within the mitigation bank, or phase thereof, in accordance with the mitigation bank permit, and
• The banker has not completely constructed the proposed system, or applicable phase thereof, in accordance with the mitigation bank permit.

As outlined in the Applicant’s Handbook: Management and Storage of Surface Waters, the mitigation bank permit shall include the following, at a minimum:

• A description of the mitigation service area.
• A ledger listing mitigation credits available in the mitigation bank. The ledger must contain
  • The maximum number of mitigation credits available for use when the mitigation bank, or phase thereof, is deemed successful
  • The type of mitigation credits awarded
  • The number and schedule of mitigation credits available for use prior to success (credit release schedule)
• Success evaluation criteria. Success, in this context, means when a mitigation bank meets the success criteria specified in the mitigation bank permit.
• The financial responsibility mechanisms that must be employed by the banker, including provisions for adjustment of the financial responsibility mechanism
• Requirements for the execution and recording of the conservation easement or conveyance of the fee interest.
• A schedule for implementation of the mitigation bank, and anyphases.
• The perpetual management requirements for the mitigation bank.
• Conditions for construction, alteration, operation, maintenance, abandonment or removal of any surface water management system proposed within the mitigation bank.

      Simply put, a ledger is a listing of the credits in a mitigation bank. A mitigation bank ledger specifies:

1. The total number and types of credits awarded to the bank
2. An accounting of the number and type of credits that are available for sale or use
3. An accounting of the number and types of credits used for each impact permit

The agency that issued the mitigation bank permit is responsible for maintaining the ledger. A ledger reflects the total the potential credits in the bank, incremental releases of credit (type and number), and use of those credits over time.

      Mitigation credits are made available to the mitigation banker for sale or use after they have been “released” by the agency that issued the mitigation bank permit. The initial release of credits may only occur after the property is conveyed or a conservation easement is recorded in favor of the permitting agency in accordance with the mitigation bank permit and SJRWMD rules and after the financial responsibility mechanisms for construction and implementation, and for perpetual management, are executed in accordance with the mitigation bank permit and SJRWMD rules.

To get credits released, the mitigation banker submits a written request request for credit release to SJRWMD along with supporting documentation.  The SJRWMD reviews the documentation and conducts a site inspection to confirm that performance criteria have been met. If the information provided by the permittee is confirmed, the credit release is authorized in writing. If the information is not sufficient, SJRWMD staff requests further information. If the information and the site visit do not support the request, the request is denied and no credits are released at that time.

      To use mitigation credits for activities undergoing permit review by SJRWMD, SJRWMD must determine whether the use of a mitigation bank is an appropriate and permittable mitigation option.  Specifically, SJRWMD must determine that the mitigation bank will offset the adverse impacts of the project and either:

1. On-site mitigation opportunities are not expected to have comparable long-term viability due to such factors as unsuitable hydrologic conditions or ecologically incompatible existing adjacent land uses; or
2. Use of the mitigation bank would provide greater improvement in ecological value than on-site mitigation.

A combination of on-site mitigation and mitigation bank credits may be appropriate to offset the adverse impacts of a project.

Projects under review by SJRWMD

To use a mitigation credit for activities undergoing permit review by SJRWMD, the following steps must occur:

• The permit applicant must submit documentation from the banker to SJRWMD demonstrating that mitigation credits have been reserved, sold, or transferred to the permit applicant and that the banker has requested that the mitigation credits be withdrawn from the mitigation bank.
• SJRWMD must determine whether the use of a mitigation bank is an appropriate and permittable mitigation option and whether a sufficient number of mitigation credits are available from the bank.   If SJRWMD determines that both of these criteria are met, a condition will be placed on the permit requiring the permittee to provide written documentation from the banker that the requisite number of bank credits have been sold to the permittee before construction of the permitted project is initiated.  Until this documentation is received, these mitigation credits will be shown as reserved on the mitigation bank’s ledger.  Reserved credits are not available for other projects.
• Once SJRWMD receives written documentation from the banker that the requisite number of bank credits have been sold to the permittee, the credits are withdrawn as a minor modification of the mitigation bank permit and SJRWMD notifies the banker of the withdrawal of the mitigation credits and the remaining balance of mitigation bank credits.

To use mitigation credits for activities undergoing review at another agency and where the credits are from a mitigation bank permitted by SJRWMD, the permit applicant must submit documentation from the banker to the permitting agency demonstrating that mitigation credits have been reserved, sold, or transferred to the permit applicant and that the banker has requested that the mitigation credits be withdrawn from the mitigation bank.

If the permitting agency determines that use of the mitigation credits proposed by the applicant is  appropriate, it notifies SJRWMD. Upon receipt of this notice, SJRWMD determines if sufficient mitigation credits are availableand notifies the permitting agency whether sufficient credits are available.  Mitigation bank credits are withdrawn from the ledger in accordance with the permit issued by the other agency.  Once the credits are withdrawn, SJRWMD will issue a minor modification of the mitigation bank permit and notify the banker of the withdrawal of the mitigation credits and the remaining balance of mitigation bank credits.

If a mitigation banker is not in material compliance with the terms of the mitigation bank permit, no mitigation credits may be withdrawn. Mitigation credits will be available for withdrawal when the banker comes into compliance.

      A mitigation bank’s service area is the geographic area in which  mitigation credits from the bank may be used to offset adverse impacts to wetlands and other surface waters. The service area is established in the bank’s permit.  The mitigation service areas of different banks may overlap.

With three exceptions, mitigation credits may only be withdrawn to offset adverse impacts of projects located in the bank’s mitigation service area.  The following projects or activities are eligible to use a mitigation bank even if they are not completely located in the bank’s mitigation service area:
a. Projects with adverse impacts partially located within the mitigation service area
b. Linear projects, such as roadways, transmission lines, pipelines
c. Projects with total adverse impacts of less than one acre in size

Before mitigation credits for these types of projects may be used, SJRWMD must still determine that the mitigation bank will offset the adverse impacts of the project and either that:

1. On-site mitigation opportunities are not expected to have comparable long-term viability due to such factors as unsuitable hydrologic conditions or ecologically incompatible existing adjacent land uses; or
2. Use of the mitigation bank would provide greater improvement in ecological value than on-site mitigation.

      Not necessarily. Whether a particular  mitigation bank is an appropriate mitigation option will be determined during the review of a permit application, on a case-by-by-case basis, using the criteria found in SJRWMD’s environmental resource permitting (ERP) rules.

      No. The environmental resource permitting (ERP) rules describe other mitigation options, including on-site or off-site preservation, enhancement, creation and restoration of ecological communities.

Who do I contact for more information?

Reid Hilliard, Technical Program Coordinator
St. Johns River Water Management District
601 South Lake Destiny Road, Suite 200
Maitland, FL 32751

Phone: (407) 659-4873
Cell: (321) 508-9536
Fax: (407) 659-4805
E-mail: jhilliard@sjrwmd.com