20100099 Ver 2_USACE Correspondence_20120206

DEPARTMENT OF THE ARMY
WILMINGTON DISTRICT, CORPS OF ENGINEERS
Washington Regulatory Field Office
Post Office Box 1000
Washington, North Carolina 27889 -1000
' �TA7E5 OF
January 26, 2012
Regulatory Division
ACTION ID: SAW- 2010 -00142 Pancho Wetland and Stream Mitigation Bank
Ms. Tara Alden
Restoration Systems, LLC
1101 Haynes Street, Suite 211
Raleigh, North Carolina 27604
Dear Ms. Alden:
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This correspondence is in reference to the proposed Pancho. Stream and Wetland Mitigation
Bank that you are developing approximately 11 miles west - southwest of Goldsboro (35.33363N
- 78.19267W) on North Carolina State Road 1008 in and adjacent to Kennedy Mill Branch in
Wayne County, North Carolina. The purpose of this letter is to address the Mitigation Bank
Instrument and Mitigation Plan received in this office on August 25, 2011.
On September 6, 2011, I sent a copy of the document to the Interagency Review Team for
their review and comment. On October 26, 2011, I forwarded comments received from the
North Carolina Division of Water Quality in their letter dated October 26, 2011. You and your
consultant met with Mr. William Wescott and Mr. Todd Tugwell of the Corps onsite on
November 3, 2011 to verify Corps jurisdiction and to assess the existing conditions on the site.
Based on the onsite evaluation and review of the Mitigation Bank Instrument and Mitigation
Plan, the Corps has some concerns and the following items must be addressed:
A. Mitigation Bank Instrument:
1. The North Carolina Division of Coastal Management ( NCDCM) stated that the proposed
bank and its geographical service area are outside any areas where the NCDCM has jurisdiction.
As' a result, NCDCM requested that they be removed from the Mitigation Banking Instrument.
2. Section II: Geographic Service• Area: Paragraph 1 states, "The GSA for this Bank will' provide
compensatory mitigation for unavoidable impacts associated with projects located within the
Neuse River Basin 8- digit- Cataloguing Unit 03020201 of North Carolina (as shown in Appendix
C)." The GSA does not provide compensatory mitigation. Therefore, this section should be

reworded to state that the GSA for this Bank will include the Neuse River Basin 8 -digit
Cataloguing Unit 03020201 of North Carolina (as shown in Appendix Q.
3. Section VII: Credit Release Schedule: Part A. Credit Release Schedule for Forested Wetlands.
This section discusses release of restoration credits but does not address preservation or
enhancement credit release. What is your proposed release schedule for these credits?
4. Section VII: Credit Release Schedule: Part B. Credit Release Schedule for Streams. In the
Mitigation Plan, you propose restoration of braided channels in areas that exhibit characteristics
Piedmont systems and you propose unique treatments in the Enhancement II reaches. Because
these are untested and-unique methods proposed for stream restoration and enhancement,
monitoring must be expanded from 5 to 7 years and the credit release schedule must be revised
accordingly. This section only outlines credit release for Restoration or Enhancement I activities.
What is your proposed release schedule for Enhancement H and Preservation credits?
5. Section IX: Financial Assurances: As we discussed with Justin McCorcle on January 5, 2012,
this section must be modified to comply with the Financial Assurance Instruments for
Compensatory Mitigation under the Corps Regulatory Program dated December 1, 2011.
6. Section X: Long -Term Protection:, Part A states that the. Bank is comprised of two parcels; .
however, paragraph 3 on page 1 states that the Sponsor is the record owner of three parcels that
comprise the Bank. Please clarify.
7. Section X: Long -Term Protection: Section C and page 5 of the Plan are not consistent. These
sections must be edited. Comparison of the red -line version of the MBI and the Corps template
reveals that this section has been edited to remove the re- recording requirement. Please explain
why this section was removed, or rewrite to include the template wording.
8. Section XI: Long -Term Management: A Long -Term Management Plan is a necessary part of
operation of a Bank, and will be required. As described in 40 CFR Part 332.7(d) the plan should
include long term management needs, estimated costs and proposed funding mechanisms to
ensure that funding is in place when the site is transferred to the long -term steward. Long term
management needs may include but are not limited to frequency and type of routine inspections
of the site, funding for legal defense of encroachments and repair and replacement of boundary
markings and fencing.
B. Mitigation Plan:
1. Based on the November 3, 2011 and January 18, 2012 onsite inspections, the Corps has
determined that the site exhibits characteristics of Coastal Plain and Piedmont systems and could
provide compensatory mitigation for unavoidable impacts associated with projects in the Neuse

River Basin 8 -digit Cataloguing Unit 03020201 of North Carolina. The Corps is satisfied with the
proposed GSA.
2. During the November 3, 2011 site visit, Mr. Wescott was unable to verify the jurisdictional
delineation. Based on the presence of field indicators, the jurisdictional boundaries were
expanded. Section 5.5 Jurisdictional Streams and Wetlands on page 8 of the Plan and Figure 4 of
Appendix A of the Plan must be updated to reflect these changes.
3. The table on pages 13 and 14 must be enlarged to be legible. Proposed activities in UT 1 -7
may not be appropriate to generate stream mitigation credit. There is no documentation that
stream channels existed in these locations or that watersheds are ofsufficient-size to support-the
development of stream features. Please review the site selection section of the 2007 Information
Regarding Stream Restoration With Emphasis on the Coastal Plain- Draft. Additionally, the
information provided in Table 5B appears to combine UTs 1,2,34, and 7. Please provide
information concerning watershed characteristics including watershed size and slope for each
tributary. Be aware that any modifications made to the Mitigation Plan may result in changes to
the credits generated by project.
4. Section 5.6.2 Discharge page 15. The Bankfull Discharge Interval described in this section is
much smaller than what is typically included in mitigation plans for similar projects. For the
purposes of this project, you will be held to the Performance Standards outlined in the 2003
Stream Mitigation Guidelines and the 2007 Information Regarding Stream Restoration With
Emphasis on the Coastal Plain- Draft. Please correct this section to comply with the guidelines.
5. Section 5.8.1 Reference Channels (page 22). The proposed reference reaches are not
appropriate for the smaller, braided tributaries. The references have much larger watersheds than
the proposed restoration areas. Please identify reference reaches that are more appropriate for the
smaller reaches and use the new reaches to modify plans for the braided sections of channel.
6. Section 6.0 Determination of Credits (page 25): In the Mitigation Plan, you propose
restoration of braided channels in areas that exhibit characteristics of Piedmont systems and you
propose unique treatments in the Enhancement II reaches. Because these are untested and unique
methods proposed for stream restoration and enhancement, monitoring must be expanded from 5
to 7 years and the credit release schedule must be revised accordingly.
7. Section 7.1 Stream Restoration (page 27) states that success criteria for stream restoration will
include 1) successful classification of the reach as a functioning stream system (Rosgen 1996)
and 2) channel stability indicative of a stable stream system. These success criteria are not
consistent with the 2003 Stream Mitigation Guidelines or the 2007 Information Regarding
Stream Restoration With Emphasis on the Coastal Plain- Draft guidance. Any section of channel
restored or enhanced is subject to performance standards and monitoring requirements as
included in current District Guidance.

8. Section 7.1 Stream Restoration (page 28) Braided Channel Development: This section must
be expanded to include a description of the proposed activities, monitoring plan and proposed
success criteria.
9. Section 7.1 Stream Restoration (page 28) Marsh Treatment Areas: Although the marsh
treatment areas may provide benefits by providing some treatment and energy dissipation for
discharges from adjacent properties, these areas will not be considered for the purposes of
calculating mitigation credits.
10. Section 7.2 Stream Enhancement (Level II)( page 29): This section must be expanded to
include a more detailed description of the proposed work, monitoring plan and specific success
criteria for these reaches. Transition points between this treatment and adjacent reaches may
experience erosion including headcuts moving downstream. Elevated water levels may result in
mortality of mature canopy trees in lower reaches. Monitoring and contingency plans must
address these concerns-. Annual monitoring must include photo documentation at designated
stations at the transition points between this treatment and adjacent reaches.
11. Section 7.4 Wetland Restoration and Enhancement (pages 30 and 31): In this section you
mention, construction of surface water storage depressions (ephemeral pools) and the possible, .
creation of "oxbow, lake- like" features. Success criteria for the wetland areas must include a
provision that open water areas may not exceed 5% of the wetland portions of the site.
12. Section 8.0 Maintenance Plan (page 32): The Corps has concerns about some of the
corrective measures described in this section. Approval of this mitigation plan does not include
approval of the specific contingency actions described in the Plan. Prior to the implementation of
any of the proposed actions, the Sponsor must obtain approval from the DE, in consultation with
the IRT. Please note that following any supplemental planting, the IRT may determine that
additional years of monitoring may be required.
13. Section 9.0 Performance'Standards Hydrology Success Criteria (page 35")__:­W­ e agree with
NCDWQ comments concerning target hydrology. The target inundation or saturation period
should to be changed to 9 -25% of the growing season. The hydrology performance standards
must be changed to reflect that groundwater gauges in reference wetlands may be used by the
USACE/NCIRT to evaluate hydrology success, but they will not "dictate threshold hydrology
success criteria ". Additionally, if wetland parameters are marginal as indicated by vegetation
and/or hydrology monitoring, the mitigation plan must not indicate that a jurisdictional
determination (JD) will be,used to determine success. A JD may indicate whether an area is a
jurisdictional wetland that meets only the minimal standards, which is not the intent of a wetland
restoration project, and accordingly, a. JD will not indicate success where vegetation and/or
hydrology monitoring indicate otherwise. The USACE may choose to conduct a JD to provide

additional information, but this will be a decision made by the USACE in consultation with the
NCIRT.
14. Section 9.0 Performance Standards Vegetation Success Criteria paragraph 3, remove
"Characteristic Tree Species" and replace with "living planted stems ".
15. Section 10.0 Monitoring Requirements (page 37): Because the Enhancement II and proposed
restoration of braided channels are untested and unique methods proposed for stream restoration
and enhancement, monitoring must be expanded from 5 to 7 years. Should the braided tributaries
be included in the in final plan monitoring requirements and success criteria must be
developed to ensure proper development of these systems.
16. Section 10.0 Monitoring Requirements (page 37): The Sponsor must submit detailed
hydrology and vegetation monitoring plans including the number and location of all proposed
monitoring wells and sampling plots to the Corps for approval prior to installation.
17. Section 11.0 Long term Management Plan (page 38): This section does not adequately
address long term management needs of the site, nor does it outline long -term funding. The plan
should specify the method and amount of the funding, as well as some description of the
intention and ability of the long -term steward (NC Wildlife Habitat Foundation) to carry out the
required activities (frequency and type of routine inspections of the site, funding for legal
defense of encroachments, etc.). Please describe the long term maintenance needs of the site and
the procedures for funding of the long -term maintenance (e.g., a portion of each credit sale into a
non - wasting endowment to be access by the steward). In particular, we would like to verify that
the funding mechanism will be in place prior to transfer the site to the long -term steward. The
Long -Term Management Plan in the MBI and the Long -Term Management section in the
Mitigation Plan must include the same information.
Thank you for your time and cooperation. The Wilmington District is committed to providing
the highest level of support to the public. To help us ensure we continue to do .so,, please ,
complete the Customer Satisfaction Survey located at our website at
http : / /regulatoEy.usacesurvey.com/. If you have any questions, please contact me at the
Washington Regulatory Field Office, telephone [phone].
Sincerely,
Tracey L. Wheeler
Regulatory Project Manager
Washington Regulatory Field Office

Copies Furnished:
Ms. Becky Fox
Wetlands Regulatory Section — Region IV
United States Environmental Protection Agency
1307 Firefly Road
Whittier, North Carolina 28789
Mr. Ron Sechler
National Marine Fisheries Service
Habitat Conservation Division
101 Pivers Island Road
Beaufort, North Carolina 28516
Mr. John Ellis
United States Fish and Wildlife Service
Ecological Services - Raleigh Field Office
Post Office Box 33726
Raleigh, North Carolina 27636 -3726
Mr. David Cox
North Carolina Wildlife Resources Commission
1142 I -85 Service Road
Creedmoor, North Carolina 27522
Ms. Karen Higgins
Supervisor, Wetlands, Buffers, Stormwater- Compliance & Permitting Unit
North Carolina Division of Water Quality
1650 Mail Service Center
Raleigh, North Carolina 27699 -1650