I have a bit of an odd job description.  I am a consultant in the mitigation banking industry.  I represent sponsors, permittees, and landowners, and I not only oversee mitigation banks cradle to grave, but also engage in permittee responsible mitigation (PRM) as well.

All this is to say, my cousins are thoroughly glassy-eyed and confused when I tell them what I do for a living at Christmas.  The reality is most of the public at large is uninformed about the Clean Water Act, what it does, and what it doesn’t do.  We hear politicians and lobbyists talk about how we have to repeal it, reinforce it, or redefine it, and yet Vegas odds are they don’t really understand what it is they are proposing to do.

People focus primarily on three parts of The Clean Water Act – Sections 401, 402, and 404.  Placement of fill into Waters of the US (WOTUS) is covered by 404, which states you cannot place “fill” into any stream, lake, wetland, slough, sandflat, mudflat, prairie pothole, playa lake, pond, wet meadow – any type of surface waterbody you can imagine with a significant nexus (hydrologic connection) to a Navigable Water of the US.

Golf carts also qualify as fill!

Section 404 happens to be my specialty, and that’s what I want to discuss in this article. Rather than providing you with a long narrative about what it covers (and all the caveats and exceptions), I’m going to cut straight to the chase.  I am commonly asked a few basic questions about how it works, no matter where I go – whether seated next to a stranger in the Delta Sky Lounge or having dinner at Grandma’s house – and these are the questions I’ll be addressing. For those of you who know this stuff inside and out, I beg your forgiveness for the brevity, and for those of you who are new to the ideas or just heard about them on the news this election cycle, I hope this gives you a good jumping off point to learn more.  So here we go…

  1. Is this whole thing just something taken to an extreme point by some environmentalists who want to stop progress? Aren’t these some relatively new regulations on industry and construction?Believe it or not, the principles behind Section 404 come from the 1899 Rivers and Harbors Act, which regulated the placement of fill (dirt, wagon wheels, cheetahs, rock, etc.) into any water that would affect navigation.  The heart of the 404 Section of the Clean Water Act is the protection of Interstate Commerce, hence why its justification lies within the Commerce Clause of the US Constitution.The only waters protected under 404 are those that have a direct connection with an ocean or are somehow involved in interstate commerce.  Some waters have such a strong economic impact on multiple states or countries they are considered Navigable in Fact, even though they don’t connect to the ocean or other navigable water, such as the Great Salt Lake and Lake Minnetonka. However, a kettle lake in the middle of nowhere with no connection to a river has neither a significant nexus to the ocean nor a strong economic impact, and therefore is not covered.
  2. Why are wetlands considered WOTUS? You can’t steer a boat in a wetland, can you?

    A gas pipeline wetland, regulated under Section 404

    Yes, wetlands are generally boat-less.  The issue is clean water has monetary value.  The fish harvested from freshwater and the associated estuaries have value.  And these are very real dollar amounts.  When pollutants run off the landscape and into adjacent waterbodies, this results in a direct and tangible financial loss to someone, and is therefore illegal without the correct 404 permit.

    Clear cut forest – another type of regulated wetland

    Wetlands have physical, chemical, and biological properties that “scrub” pollutants out of the water before they flow into the adjacent waterbody.  Metals are sequestered, some volatile organic compounds are broken down, and nutrients from fertilizers are taken up by plants.  The water coming out of a wetland is all around cleaner than when it went in, so wetlands associated with rivers/navigable waters are protected.  Isolated wetlands (not hydrologically connected to a navigable water), however, are not protected under Section 404 to date.

  3. Who is in charge of 404 permitting? Is the Environmental Protection Agency (EPA) the principal permitting agency?Actually, the US Army Corps of Engineers (USACE) is responsible for the determination and delineation of Waters of the US as well as the permitting of impacts to WOTUS or mitigation.  Remember, the initial legislation was to protect commerce through travel along the waterways.  The USACE has, historically, been the agency responsible for dams, locks, levees, and other modes of conveyance traditionally classified as Navigable Waters.  The EPA and USACE work in conjunction with one another to establish the rules and guidelines of the implementation of Section 404, but for any given project, you will principally be working with a USACE project manager.
  4. So what is a mitigation bank? Do they issue currency?

    Sometimes a project will place fill into a WOTUS and it cannot be avoided or minimized.  We all need roads, pipelines, and hospitals, right?  The rules say there can be no net loss of aquatic resources.  You can’t just steal from people just because they aren’t present when you do it, and as we established in Question #2, water is actually worth something.  So if you are going to impact a water, then the rule states you have to “clean up/protect” a water somewhere else to maintain the overall amount of resource.Mitigation banks (related to Section 404) are tracts of land with many acres of wetlands/linear feet of stream restored or preserved ahead of time, and credits are issued representing the economic worth and ecological benefit of the resource.  Those credits are then exchanged like currency to those permittees who have to impact a WOTUS.  Think of it as a kind of ecological “indulgence” to put towards future sins.  If a mitigation bank isn’t available in your area of impact, you may have to go to an in-lieu fee program (a mitigation bank paid for once you have sold all the credits and collected all the money or “going to confession to ask for forgiveness”) or PRM, but these are ripe for a whole other discussion in and of themselves.
  5. Do 404 mitigation banks protect bugs, bunnies, left-handed chipmunks, or other interesting critters?Yes and no.  This is actually a very common area for misunderstanding with mitigation banks.  Mitigation banks are often accused of not replacing one to one the wildlife or wildlife habitat lost when an area is impacted.  Mitigation banks replace lost aquatic resource functions including chemical, physical and biological processes as their primary purpose.  By virtue of their large size, access to water, and distance from commercial/residential encroachment, they often do protect wildlife and their habitats, but the purpose was to preserve or restore the holistic functions of a WOTUS, such as a tributary or associated wetland, not strictly the biological inhabitants.An analogue for a mitigation bank could be a very well built house in a very nice neighborhood.  If you construct or preserve an ideal habitat, it will serve as a hub of recruitment for all kinds of wildlife, and if you are in the same watershed as the impact, it should be the same assemblages of species.  As indicators of the quality of construction of the house, some biotic indicators are measured, such as the presence and abundance of wetland plants and pollution intolerant aquatic animals but, in general, full zoonotic or floristic surveys are not required.

So if you, like my cousins, had no idea what 404 mitigation banking was, I hope this was helpful.  Please feel free to reach out to us if you have questions about the market, credits, permitting, or anything else mitigation that pops into mind.  If you are in the mitigation industry, we would love to hear any anecdotal stories you may have of trying to explain what you did “when you grew up” to friends and family.  If they’re anything like mine, I bet they’re a hoot!

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About the author

Kate Lindekugel
Kate Lindekugel
As an environmental scientist, Kate has more than 13 years of experience including ecological surveys and field studies, functional assessments, preparing environmental reports and permits, data management, stream channel and wetland restoration, peer reviewed research, and coordinating with local, state, and federal regulatory agencies, as well as public and private stakeholders.