Mitigation Banking

Mitigation Banking

What is a Mitigation Bank?

According to the EPA, Compensatory Mitigation Fact Sheet, “A mitigation bank is a wetland, stream, or other aquatic resource area that has been restored, established, enhanced, or (in certain circumstances) preserved for the purpose of providing compensation for unavoidable impacts to aquatic resources permitted under Section 404 or a similar state or local wetland regulation.”

A mitigation bank is created when an entity, such as a government agency, corporation, or a nonprofit organization, commences these activities under a formal agreement with the regulatory agency.

Mitigation banks have four components:

  • The Bank Site: The physical area to be restored, established, enhanced, or preserved.
  • The Bank Instrument: Agreement between the bank owner and regulators that establishes liability, performance standards, management and monitoring requirements, and the terms of bank credit approval.
  • The Interagency Review Team (IRT): Provides the regulatory review, approval, and oversight of the bank.
  • The Service Area: Geographic area where the permitted impacts can be mitigated for.

A bank’s value is defined in “compensatory mitigation credits”. The bank’s instrument analyzes the number of credits available for sale and requires an ecological assessment to certify that the credits provide the required ecological functions.

While many banks only compensate for impacts to various wetland types, there have been banks developed to compensate for impacts to streams (i.e., stream mitigation banks.)


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