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Encouraging Innovation in Stream Mitigation Banking

Stream mitigation banks, like other market-based approaches to conservation, must ensure robust ecological outcomes. Meridian convened a group of mitigation bankers, environmental organizations, and academics who identified policy recommendations to better encourage innovation that supports ecologically complex stream ecosystems.

The Clean Water Act is a foundational federal law set up to protect streams and lakes from pollution. One of its provisions—Section 404—establishes mitigation banks as a market-based approach to restoring wetlands and streams. When a development project (e.g., road construction, public utilities, infrastructure expansion) has unavoidable impacts to aquatic resources, the developer can purchase a credit for the restoration of a similar wetland or stream in a different location. This market is regulated and permitted by the U.S. Army Corps of Engineers and the Environmental Protection Agency.  

As a result of this legislation, many companies over the last 20 years have been involved in ecological restoration, creating an extensive restoration economy—including more than $25B in economic output and 225,000 jobs.1 Demand for mitigation banking is likely to increase in response to recent federal investments in infrastructure. 

Streams are complex ecological systems and therefore restoration projects need to meet that complexity. Over time, restoration markets have increasingly focused on channel form and stability instead of the suite of physical, biological, and chemical processes which support improved ecological outcomes. Current training resources and policy mechanisms tend to reinforce this emphasis on form and stability.  

Meridian Institute, with funding from the Walton Family Foundation and the Ecological Restoration Business Association, convened mitigation bankers, agency staff, non-profit organizations, and academic experts to explore the challenges and opportunities for improving ecological outcomes and encouraging innovation under Section 404 of the Clean Water Act. The result was a consensus document that highlights key challenges and proposes a range of potential solutions– Supporting Innovation in 404 Stream Mitigation for Improved Ecological Outcomes: Problem Statement and Recommended Solutions. 

These documents have been sent to the leadership at the U.S. Army Corps of Engineers and the Environmental Protection Agency with the hope of initiating a Regulatory Guidance Letter to support policy changes that better encourage innovation. Meridian Institute continues to bring together a range of actors across the nation to support implementation of the recommendations.  

 

Supporting Innovation in 404 Stream Mitigation for Improved Ecological Outcomes Webinar (Recording)

Watch the September 6, 2023 webinar on Supporting Innovation in 404 Stream Mitigation for Improved Ecological Outcomes: Problem Statement and Recommended Solutions here (passcode: 6r?eRw8.).