20171122 Ver 2_Signed GUC MBI_20200217

AGREEMENT TO ESTABLISH THE RESTORATION SYSTEMS'GUC MITIGATION
BANKING INSTRUMENT IN THE TAR-PAMLICO RIVER BASIN FOR NUTRIENT
OFFSET AND RIPARIAN BUFFER MITIGATION CREDITS PURSUANT TO THE
TAR-PAMLIC0 NUTRIENT MANAGEMENT STRATEGY
TABLE OF CONTENTS
1.
PREAMBLE 2
It.
LOCATION AND GEOGRAPHIC SERVICE AREA ......................................................................
2
Ill.
AUTHORITIES .................................................................................................................................. 3
IV.
ESTABLISHMENT OF BANK PARCEL ......................................................................................... 3
V.
BANK PARCEL DEVELOPMENT PACKAGE .............................................................................. 5
Vt.
POST CONSTRUCTION DOCUMENTATION FOR THE BANK PARCEL ................................7
VII.
CALCULATION OF CREDITS FOR THE BANK PARCEL ........................................................10
Vill.
CREDIT RELEASE SCHEDULE ....................................................................................................
I I
IX.
PROCEDURE FOR DEBITING AND CREDITING .....................................................................
12
X.
BANK PARCEL CLOSURE ............................................................................................................
13
X1.
GENERAL PROVISIONS FOR THE BANK PARCEL .................................................................
14

ATTACHMENTS & REFERENCES
A Division of Water Resources Authority Document
B - NCDWR - Methodology & Calculations for Nutrient Reductions on the Bank Parcel
C Ledger Templates
t. Nutrient Offset Payment Rule:
h tip:/lreports.oah. state.ne.us/ncac/title%2015a%20-%20environmental%20qual ity/chapter%2002%20-
%20environmental%20management/subehapter%20b/ 15a%20ncac%2002b%20.0240. pdf
2. Riparian Buffer Mitigation Rule:
http://rcports.oah.state.nc. us/ncac/title%2015aofo20-%20environmentaf%20qualitylehapter%2002%20-
%20cnvironmental%20management/subchapter%20b/ 15a%20ncac%2002b%20.0295.pdf
2. NC Session Law 2019-86 "Nutrient Offset Credits":
https://ncleg.gov/EnactedLegislation/Session Laws/UITM L/2019-2020/S L2019-86. htm I
3. Buffer Interpretation/Clarification 42008-019 for diffuse Flow:
https:Hfilcs.nc.gov/nedeq/Water%20Qual ity/Surface%20 Water%20Protection/401 /Buffer%20CIarificati
on%20Memos/Diffuse-Flow-for-Bu ffer-M itigation-Sites-Buffer-Clarification-Memo-20080819.pdf

1. PREANIBLE
This Restoration Systems GUC Mitigation Banking Instrument ("Instrument") regarding the
establishment, use, operation, and maintenance of the GUC Nutrient Offset and Buffer
Mitigation Bank Parcel ("Bank Parcel"), further identified in Section 11, is to provide Tar -
Pamlico Riparian Buffer mitigation credits ("Riparian Buffer Credits") and Tar -Pamlico
Nutrient Strategy nutrient load reduction credits ("Nutrient Offset Credits"), is made and
entered into by and among Restoration Systems, LLC (RS) as the Bank Sponsor ("Sponsor"),
and the North Carolina Department of Environmental Quality -- Division of Water Resources
("DWR"). This Instrument is in accordance with 15A NCAC 02B .0240 and 15A NCAC 02B
.0295, see references.
The purpose of the Bank Parcel is:
A. To restore and preserve riparian vegetation adjacent to streams and agricultural ditches
with the intent to improve water quality within the Tar -Pamlico River Basin.
B. To convert agricultural land uses within riparian areas adjacent to streams and agricultural
ditches into a dense, hardwood vegetated state with the intent to significantly reduce
nutrient loadings associated with agricultural practices into streams and ditches.
C. To provide mitigation and sell any resulting Riparian Buffer Credits and Nutrient Offset
Credits to third parties in the Tar -Pamlico River Basin, for development (both existing and
proposed), or to offset NPDES permitted wastewater nutrient sources requiring such
mitigation or offset, and or permit obligations requiring such mitigation.
II. LOCATION AND GEOGRAPHIC SERVICE AREA
A. The Geographic Service Area ("GSA") is the designated area wherein a Bank can
reasonably be expected to sell Riparian Buffer Credits and Nutrient Offset Credits for
impacts requiring such mitigation or offset.
B. The GSA for this instrument is limited to the Tar -Pamlico River Basin in the State of North
Carolina, United States Geological Survey ("USGS") 8-digit Hydrologic Unit Code
("HUC") 03020103.
C. Sale or transfer of Riparian Buffer Credits shall be limited to the 8-digit HUC 03020103 in
the Tar -Pamlico River Basin, unless otherwise authorized by the DWR or delegated local
government in accordance with 15A NCAC 02B .0295.
D. Sale or transfer of Nutrient Offset Credits shall be limited to the 8-digit HUC 03020103 in
the Tar -Pamlico River Basin, in accordance with 15A NCAC 02B .0240, unless otherwise
authorized by the DWR in accordance with Session Law 2019-86.
E. Table 1 provides site -specific details of the Bank Parcel proposed under this Instrument.

Table 1.0 — Site -specific Details
Bank
8-Digit USGS
Named
Parcel
j County Hydrologic Unit
DWR
Project ' Receiving
Primary Land Use/s
Name
Code
ID #
Location Stream
GUC i
Pitt 03020103
2017-
Greenville Tar River
Biosolid Application
1 122v2
& Agricultural Crops
III. AUTHORITIES
A. The Bank will be used to provide Riparian Buffer Credit and Nutrient Offset Credit in
accordance with the requirements in the DWR Authority document referenced herein as
"Attachment A" and attached to this Instrument.
B. Projects eligible for utilization of the credits are those requiring authorization under the
requirements of Attachment A and any new approved North Carolina General Statutes
(NCGS) and rules for the Tar -Pamlico Nutrient Management Strategy.
C. The selling of credits generated from the Bank Parcel approved under this Instrument, shall
be consistent with approved North Carolina ("State") statutes and rules for the Tar -Pamlico
Nutrient Management Strategy.
D. Mitigation activities proposed under this Instrument and corresponding Bank Parcel
Development Package (BPDP) to generate Riparian Buffer Credits and Nutrient Offset
Credits shall be consistent with North Carolina ("State") statutes and rules for the Tar -
Pamlico Management Strategy that are in place at the time a complete BPDP is submitted
to DWR.
IV. ESTABLISHMENT OF BANK PARCEL
A. In accordance with 15A NCAC 02B .0295 and 15A NCAC 02B .0240, DWR has provided
a "Site Viability Letter" for the Bank Parcel proposed under this Instrument. The site
viability letter is not an approval ofthe site to generate Riparian Buffer Credits and Nutrient
Offset Credits, but is a preliminary review of the Bank Parcel that details and confirms
existing land -use conditions, defines the riparian sites (Enhancement, Preservation, or
Restoration), and identifies features (streams, ditches, ponds, etc.) that meet general criteria
to be suitable to generate Riparian Buffer Credits and Nutrient Offset Credits. "fable 2.0
below outlines when the Site Viability Letters were issued by NCDWR:
Table 2.0 — Site Viability Letter Details
Bank Parcel NC DWR Site Visit
Viability Letter ! Viability letter I
' f
- 3 Received j Expiration Date
GUC November 14, 2017 May 29, 2019 I March 25.2021

GUC November 14, 2017 March 25, 2019 March 13, 2021
B. A valid Site Viability Letter is required prior to submittal of the BPDP, Site Viability
Letters will either expire on the dates listed above or upon the submittal of an individual
As -Built Report to the DWR, whichever comes first. If a Site Viability Letter expires prior
to submittal of a complete BPDP as described in Section V to DWR, then the Sponsor must
submit a formal request to DWR for a new Site Viability Letter for that Bank Parcel.
C. The Bank Parcel proposed for inclusion under this Instrument shall require a BPDP be
submitted to, and approved by, the DWR prior to use of the Bank Parcel for mitigation
purposes or sale or transfer of any associated credits. The contents of the BPDP are
provided in Section V.
D. The Bank Parcel can be proposed as two separate phases with each phase described in
detail in the BPDP.
E. No mitigation activities approved in the BPDP, shall be performed in any areas that are
directly or indirectly affected by the installation of above -ground and/or underground
utilities, until, compliance of all applicable permits or authorizations associated with the
utilities has been achieved. The Bank Sponsor shall receive verification of compliance
from DWR prior to conducting activities related to generating Riparian Buffer Credits or
Nutrient Offset Credits in areas.
F. The BPDP submitted under this instrument will be placed on public notice and made
available for public commenting for 15 calendar days.
G. In general, the Bank Sponsor expects all Riparian Buffer Credits and Nutrient Offset
Credits to be generated through either riparian restoration or riparian preservation. Riparian
Buffer Credits are only attainable if the width of the riparian area is at least 20 feet from
top of bank,
H. The Bank Parcel is intended to provide Riparian Buffer Credit as follows:
1. Planting hardwood trees or trees and shrubs on a Restoration Site as defined in 15A
NCAC 02B .0295 (b) adjacent to streams and primary ditches where agriculture has
been determined to be the predominant land -use.
2. Diffused flow will be maintained onsite to the maximum extent practicable. The Buffer
Interpretation/Clarification Memo #2008-019 may be applied where maintenance of
diffuse flow onsite is unattainable.
3. Maintaining a Preservation Site as defined in 15A NCAC 02B .0295(b) by placing a
perpetual conservation easement around riparian areas.
Nutrient Offset Credit may be achieved on the Bank Parcel through restoration of the
riparian areas where agriculture is the predominant land use. Nutrient Offset Credits are
only attainable if the width of the restored riparian areas are at least fifty (50) feet as
measured perpendicular from tops of stream and ditch banks. The width of the restoration
area begins at the most landward limit of the top of bank or the rooted herbaceous

vegetation and extends landward a minimum of 50 feet and a maximum of 200 feet on all
sides of the surface waters.
J. The Bank Parcel is expected to provide Nutrient Offset Credits in accordance with 15A
NCAC 02B .0240 and is expected to provide Nutrient Offset Credit as follows:
1. Converting agricultural land uses within riparian areas to non-agricultural land
uses.
2. Planting hardwood trees or trees and shrubs on a Restoration Site as defined in 15A
NCAC 02B .0295 (b) adjacent to streams and primary ditches where agriculture
has been determined to be the predominant land -use.
F. The Bank Parcel submitted for review under this Instrument is anticipated to begin
construction of proposed riparian activities after approval of this Instrument and
corresponding BPDP.
V. BANK PARCEL DEVELOPMENT PACKAGE
A. The BPDP submitted under this Instrument shall be submitted to DWR for review and must
be approved by DWR prior to any construction on the Bank Parcel. The BPDP will
describe specifics related to any phasing of the Bank Parcel. The BPDP must describe any
changes that have occurred to the site between the date of the Site Viability letter and the
date the BPDP is submitted to DWR. The BPDP shall include detailed information
consistent with the sections below concerning; 1) site location (8-digit HUC is required);
2) existing conditions with current photos; 3) proposed buffer mitigation and nutrient
offset activities including a detailed vegetation plan; 4) monitoring and maintenance plans;
5) financial assurances; 6) associated buffer/nutrient credit calculations, which shall
include credit generation, service area, and accounting as appropriate for each regulatory
authority; 7) stream determination letter from DWR;$) Site Viability Letter from DWR, 9)
service area figure for each mitigation type; and 10) all pertinent information regarding
permitting, bank stabilization, culvert removal, and installation of utilities indirectly or
directly affecting the Bank Parcel.
B. The Sponsor will obtain all applicable federal, state, and local documentation, permits, or
authorizations needed to construct and maintain the Bank Parcel. This Instrument does not
qualify as, or substitute for, such documentation, permit, or authorization.
C. Any restoration activities or proposed construction within the riparian buffers and other
riparian areas on the Bank Parcel to produce Riparian Buffer Credit and/or Nutrient Offset
Credit must be approved by DWR in writing prior to implementation. The failure of the
Sponsor to comply with this requirement may result in a revised or reduced credit release
schedule for the Bank Parcel.
D. Requests for deviation from the approved BPDP must be submitted to DWR in writing.
Written approval from the DWR must be received prior to implementing any deviation
from the approved BPDP.

Pro pert} _Disposition & Lone Term ManAu..ement_for the. Bank Parcel
E. Prior to the release of any credits, the Sponsor shall record permanent conservation
easements at the Pitt County Register of Deed's office that is sufficient to ensure protection,
operation and maintenance of restored riparian buffers and other riparian areas in
perpetuity.
F. The form of the conservation easement shall be consistent with the standards employed by
the State of North Carolina in the protection of restored riparian buffers and riparian areas
and shall be approved by the DWR prior to the release of any credits.
G. The Sponsor shall not grant additional easements, right of ways, or any other property
interest in or to the project areas, without prior approval from the DWR.
H. The Sponsor agrees to transfer or assign the conservation easement and its interests in
perpetuity to a qualified holder under NC General Statute ("GS") 121-34 et seq. and 170(h)
of the Internal Revenue Code prior to the submittal of the Year 4 Monitoring Report. The
holder shall be a land trust or stewardship program that will hold and enforce the
conservation easement and the interests in perpetuity. The Sponsor shall choose a land trust
or stewardship program that is accredited by the Land 'Crust Accreditation Commission
and/or has been approved by DWR prior to the end of the fourth year monitoring period.
A land trust must be certified under 501(c)(3) of the Internal Revenue Code,
I. In the event the Sponsor is also the owner of the underlying fee interest in the property, the
conveyance of the conservation easement to a land trust or stewardship fund must be
arranged at the outset of the approved BPDP.
Financial Assurances for the Bank Parcel
Following approval of the BPDP, the Sponsor shall provide a Performance/Maintenance
Bond from a surety company that is rated no less than an '-`A-" as rated by A.M. Best, to
construct the Bank Parcel, in its entirety, including all phases according to the approved
BPDP. If necessary, RS may elect to acquire a separate bond for each phase of the Bank
Parcel as described in the BPDP. It is the Sponsor's responsibility to confirm that the
surety company is rated no less than an "A-" with each annual bond renewal.
K. The amount of the Performance Bond/s shall be 100% of the estimated cost for
implementation ofthe riparian mitigation activities and construction of the Bank Parcel as
described in the approved BPDP. No bond shall be less than $150,000.00 to cover
construction costs.
L. Alternatively, in lieu of posting Performance Bonds, the Sponsor may elect to construct
the Bank Parcel, in its entirety, including all phases prior to the first credit release.

M. Once DWR has released all credits for completion of all the items listed below for each
phase of the Bank Parcel, then the Bank Sponsor will be released from its performance
obligations under the performance bondls required in Item J and K of this section:
1. Instrument and BPDP Approved by DWR, Conservation Easement Recorded,
Financial Assurance Posted;
2. Site Earthwork, Planting and Installation of Monitoring Devices Completed;
3. As -Built Report as described in Section VI has been received by DWR; and
4. DWR has submitted a written approval of the As -Built Report
N. To comply with this section, DWR must be the Obligee on all performance bonds.
VI. POST CONSTRUCTION DOCUMENTATION FOR THE BANK PARCEL
As -Built Report
A. The Sponsor agrees to perform all necessary work, in accordance with the provisions of
this Instrument and corresponding BPDP, to establish, maintain, and monitor Riparian
Buffers or other riparian areas until Item B (1) and (2) of Section X have been satisfied.
B. When all riparian mitigation activities and construction have been completed for the Bank
Parcel, in its entirety, including all phases, the Sponsor will submit an as -built plan and
report for the Bank Parcel within 30 calendar days after completing the establishment of
the riparian buffer and nutrient offset areas. If necessary, RS may elect to submit a separate
As -Built Report for each phase ofthe Bank Parcel as described in the BPDP. The As -built
Report will be submitted to DWR and describe any deviation from the approved BPDP and
will document the following:
I. Riparian restoration and planting details, invasive species control, confirmation of
fence installation if applicable, cattle exclusions if applicable, monitoring device
locations, vegetation plot locations, and photo point locations, as appropriate.
2_ Boundary Survey of the conservation easement area, signed and sealed by a
licensed surveyor, including an inventory of the final riparian buffer mitigation and
nutrient offset areas in both square feet and acres.
3. As -built map of the mitigated areas showing where riparian restoration and
preservation were performed and any deviations to the Bank Parcel from what was
approved in the BPDP.
4. Aerial map of the restoration and preservation areas approved in the BPDP.
5. Confirmation from DWR that all permits and authorizations directly or indirectly
associated with the Bank Parcel, including those affiliated with the installation of
above -ground and underground utilities, are all in compliance with applicable
permit conditions.

Financial Assurance for the Bank Parcel
C. After completion of the riparian mitigation activities and construction on the Bank Parcel,
in its entirety, including all phases, a separate Performance/Maintenance Bond/s will be
secured for 100% of the estimated cost to implement the monitoring and maintenance plan
as described in the approved BPDP and As -Built Report for the site. If necessary, RS may
elect to acquire a separate bond for each phase of the Bank Parcel as described in the BPDP.
The Bond/s must be from a surety company that is rated no less than an "A-" as rated by
A.M. Best, and it is the Sponsor's responsibility to confirm that the surety company is rated
no less than an "A-" with annual bond renewal.
D. Each Performance/Maintenance Bond shall be secured each year for a minimum of five
years, and until DWR has released all Riparian Buffer Credits and Nutrient Offset Credits
to the Bank Sponsor. Upon DWR approval, the bonds may be lowered each year based on
the adjusted cost to complete the monitoring. No bond shall be less than $100,000 to cover
monitoring and maintenance costs.
E. Once DWR has released 100% of all credits for completion of all Bank Parcel milestones
described in Table 3 of Section Vlll and in the corresponding BPDP, the Bank Sponsor
will be released from its performance obligations under the performance bond/s required
in "C-D" of this Section.
F. To comply with this section, DWR must be the Obligee on all performance bonds.
Monitorin_and Maintenance_Reports
G. The Sponsor shall monitor the Bank Parcel, in its entirety, including all phases as described
in the BPDP until such time as DWR determines that the performance standards described
below have been met. The monitoring period shall be a minimum of five consecutive years
for each phase of the Bank Parcel.
H. Performance Standards for Vegetation: Native hardwood trees or native hardwood tree
and shrub species should be planted at a density sufficient to provide 260 stems per acre
after five years. A minimum of four (4) native hardwood trees or four (4) native hardwood
tree and shrub species must be planted. No one species shall be greater than 500,10 of the
planted stems. A list of species for planting will be detailed in the BPDP for approval.
Native hardwood tree volunteer species may be included to meet performance standards as
determined by the DWR.
1. A 'stem" means a woody seedling, sapling, shrub or tree, no less than 10 centimeters in
height.
J. If the performance standards of the vegetation are not met, supplcmcntal plantings maybe
required. Supplemental plantings will be utilized until the required densities have been
achieved and maintained for five years. Bank Parcel maintenance, such as ensuring diffuse
flow, managing invasive species, and pest control will be included in the BPDP.

K. Monitoring Reports for Riparian Buffer Credit and/or Nutrient Offset Credit:
Reporting criteria of the vegetation shall be based on the Carolina Vegetation Survey
(CVS) — EEP Protocol for Recording Vegetation Level 2 Plot Sampling only version 4.0
or any updated versions of this protocol in place at the date of acceptance of the BPDP.
The Sponsor shall submit an annual monitoring report no later than December 31 of each
year for a minimum of five consecutive years after the first full growing season. if
necessary, RS may elect to submit a separate monitoring report for each phase of the Bank
Parcel as described in the BPDP. This report will describe the conditions of the Bank
Parcel, including an evaluation of the performance standards of the vegetation contained
within the approved BPDP. Reports shall contain the following:
l . A U.S. Geological Survey map showing location of the Bank Parcel;
2. A detailed narrative with supporting photos summarizing the condition of the Bank
Parcel along with any maintenance or remediation performed that year; and
3. A map, survey, or other figure showing locations of sampling plots, permanent
photo points, location of transects, etc.; and
4. Monitoring data, including specific vegetative counts showing that the trees or tree
and shrub species planted are meeting performance standards and updated
photographs; and
5. A copy of the most recent Bank credit/dcbit ledgers; and
b. Corresponding verification letters from designated local governments upon request;
and
7. Corresponding Mitigation Transfer Certificates upon request.
8. Proof of performance bond renewal to cover the next monitoring year (if
applicable)
Continuencv Plans/Remedial Actions
L. In the event the Bank Parcel fails to achieve the performance criteria described in this
Instrument and the approved BPDP, the Bank Sponsor shall develop necessary contingency
plans in coordination with the DWR and implement appropriate remedial actions for the
Bank Parcel and the Bank. Depending on the degree of remedial actions required, the DWR
may modify the monitoring period.

VII. CALCULATION OF CREDITS FOR THE BANK PARCEL
Riparian Buffer Credits
A. Alt Riparian Buffer Credits shall be determined based on the ratios and percentages
provided in 15A NCAC 02B .0295 (m) and (n),
B. Riparian buffer restoration on the Bank Parcel, as described in 15A NCAC 02B. 0295 (n),
and defined in 15A NCAC 02B .0295 (b) that is performed on agriculture lands within the
Bank Parcel, may be used for either Riparian Buffer Credit or nutrient offset Credit, but
not both.
C. Riparian buffer preservation on the Bank Parcel, as described in 15A NCAC 02B .0295
(o), and defined in 15A NCAC 028 .0295 (b) can only be used for Riparian Buffer Credit.
D. Riparian Buffer Credit is defined as one (1) buffer credit per one square foot or 43,560
buffer credits per one acre.
E. Pursuant to 15A NCAC 02B .0295 (1)(6)(B), "Buffer mitigation credit shall not be
generated within wetlands that provide mitigation credit required by 15A NCAC 02H
.0506"..
Nutrient Offset Credits
F. The acreage of Nutrient Offset Credits on the Bank Parcel submitted under this instrument
is determined by applying the applicable ratio as provided in 15A NCAC 02B _0295 (m)
for a Restoration Site. All riparian areas proposed for Nutrient Offset Credits must be a
minimum of fifty (50) feet from the top of the bank along streams and ditches adjacent to
land noted in the Site Viability Letter as agriculture.
G. Nutrient Offset Credits cannot be achieved through the preservation activities performed
on the Bank Parcel.
f1. Nutrient Abatement of Restored Riparian Area/Buffers on Agricultural lands: The Sponsor
and DWR agree to the following:
The pounds of nitrogen offset per acre of restored riparian areas/buffers shall be
2,273.02 pounds per acre,
The pounds of phosphorus offset per acre of restored riparian areas/buffers shall be
146.40 pounds per acre,
The Sponsor and DWR agree that the methodology and calculations for determining
nitrogen and total phosphorus reduction, associated with restoration of riparian areas on
this Bank Parcel shall be fixed as part of the approval of this Instrument, with the fixed
amount not changing during the Bank Parcel Development or credit release schedule for
the Bank Parcel. The approved method and calculations for determining nutrient
reductions associated with the riparian restoration on this Bank Parcel is provided in further
detail in Attachment B.
10

VIII. CREDIT RELEASE SCHEDULE
A. Upon submittal of all appropriate documentation by the Sponsor, and subsequent approval
by DWR, it is agreed that Riparian Buffer Credits and Nutrient Offset Credits associated
with the Bank Parcel, in its entirety and including all phases, will become available for sale
or transfer to a third party in accordance with the Credit Release Schedule in 'Table 3.0.
B. If necessary, RS may elect to have a separate Credit Release Schedule for each phase of
the Bank Parcel. All phases will be subject to the same schedule as provided in Table 3.0
below:
'Table 3.0 - Credit Release Schedule for Riparian Buffer and Nutrient Offset Credits
% Credit
Task Project Milestone
Available for
Sale
Instrument and BPDP Approved by DWR, Conservation Easement
l Recorded*, Financial Assurance Posted, and all utilities installed and in
20
compliance with state issued permiWauthorizations where applicable
Site Earthwork, Planting and Installation of Monitoring Devices Completed
`
20
and all applicable permits obtained
3 Monitoring Financial Assurance Posted and Approval of As -Built Report
10
4 Monitoring Report#l: Approved by the DWR** & financial assurances
10
renewed
Monitoring Report 42: Approved by the DWR** & financial assurances
l0
renewed
6 Monitoring Report 43: Approved by the DWR** & financial assurances
10 I
renewed
Item B (1) of Section X in this Instrument has been completed and
5
approved b% DWR.
f
No remaining credits will be released until the conservation easement has
j.
been assigned to an approved land trust or stewardship
8 Monitoring Report 44: Approved by the DWR** & financial assurances
S
renewed
9 ( Monitoring Report 45 Approved by the DWR** and final site visit by
DWR has been conducted
10
Total
100%
* For specification, please see Section V in this Instrument
* * DWR Approval provided upon a determination that the site is meeting success criteria contained within the
approved BPDP
C. DWR may modify the credit release schedule based on the information submitted or the
order in which required information is received. DWR will notify the Sponsor of any
modification to the credit release schedule.

IX. PROCEDURE FOR DEBITING AND CREDITING
Credit Leelvers
A. The Bank Sponsor shall maintain a credit ledger for each mitigation type for each phase of
the Bank Parcel under this Instrument: Credit ledgers shall provide the accounting for
Riparian Buffer Credits in square feet and acres, and Nutrient Offset Credits in pounds and
acres.
B. Each credit ledger shall be submitted on a separate 8 ''/2-in X I 1-in spreadsheet with legible
font style and font size. All ledgers shall be submitted using the templates provided in
Attachments D of this Instrument or any updated versions to these templates as provided
by DWR.
Credit Processing
C. Riparian Buffer Credits generated on this Bank Parcel will be used to provide mitigation
for authorized buffer impacts within the Tar -Pamlico River Basin according to 15A NCAC
02B .0295 (0 and (g).
D. Nutrient Offset Credits generated on this Bank Parcel will be used to offset nitrogen and
phosphorus nutrient loads within the 8-digit HUC 03020103 of the Tar -Pamlico River
Basin in accordance with 15A NCAC 02B .0240.
E. Available Riparian Butler Credits (credits that have been released by DWR but not sold by
the Sponsor) that meet criteria for nutrient offset credits as outlined in Section VII of this
Instrument, the Site Viability Letter and the corresponding BPDP can be converted and
transferred from Riparian Buffer Credits to Nutrient Offset Credits upon written approval
from DWR. Once a credit has been converted to another credit type, the transaction is
permanent and the credit cannot be converted again.
F. Available Nutrient Offset Credits (credits that have been released by DWR but not sold by
the Sponsor) that are generated within 0- 100' from tops of banks and meet criteria for
riparian buffer credits as outlined in Section VII of this Instrument, the Site Viability Letter,
15A NCAC 02B .0295 and the corresponding BPDP can be converted from Nutrient Offset
Credits to Riparian Buffer Credits upon written approval from DWR. Once a credit has
been converted to another credit type, the transaction is permanent and the credit cannot be
converted again.
G. The Bank Sponsor shall obtain written verification of nutrient otfset need from a designated
local government within the 8-digit HUC 03020103 of the Tar -Pamlico River Basin, or
from DWR through an approved NPDES permit for wastewater nutrient sources, prior to
debiting Nutrient Offset Credits from the Bank Parcel.
H. The Bank Sponsor shall obtain written verification of buffer mitigation required from the
delegated local government in the Tar -Pamlico River Basin or DWR prior to debiting
Riparian Buffer Credits from the Bank Parcel.
12

I. All credit and debit transactions for the Bank Parcel under this Instrument shall be
accurately depicted in the credit ledgers. The Sponsor shall provide DWR up-to-date credit
ledgers for the Bank Parcel by the tenth (I0`h) of each month. At a minimum and upon
request, DWR shall receive a hard copy of updated credit ledgers along with the
corresponding Mitigation Credit Transfer Certificates ("Certificate") and all corresponding
letters from the designated local governments or DWR where applicable, once a year.
Notification of all credit sales shall be provided to DWR until all credits that have been
released have been sold.
Miti a� tion.Credit Transfer Certificates
J. All credit sales will include a Mitigation Credit Transfer Certificate ("Certificate") that is
required to be provided to the buyer of Riparian Buffer and/or Nutrient Offset credits, that
will include, at a minimum, the following information:
Bank Details: (1) Bank Sponsor Name, (2) bank parcel as it appears in this
Instrument, (3) DWR project number for the BPDP as it appears in Table 1.0
2, Credit Details: (1) date of receipt, (2) identify if full or partial payment, (3-when
applicable)amount of nitrogen Nutrient Offset Credits purchased in pounds and
confirmation from the designated local government or DWR of the amount
required, and (4-when applicable) amount of phosphorus Nutrient Offset Credits
purchased in pounds and confirmation from the designated local government or
DWR of the amount required, (5) amount of Riparian Buffer Credits purchased in
square feet and the confirmation from DWR or the local government of the amount
required.
Permitted Project Details: (1) project name as it appears on DWR or local
government permits and/or certifications, (2) 8-digit HUC, (3) river basin, (4)
nutrient strategy applicable to the project, (5 — when applicable) designated local
government or DWR requiring Nutrient Offset Credits, and/or (6 — when
applicable) DWR authorization number or delegated local government requiring
Riparian Butner Credits for this project
K. If the DWR determines that the Bank is operating at a deficit (e.g. the Sponsor is utilizing,
selling, leasing or transferring credits that are not available), or the Bank is out of
compliance with statutes, rules or this Agreement, the sale/transfer will immediately cease,
and the DWR, in consultation with the Sponsor, will determine what remedial actions are
necessary.
X. BANK PARCEL CLOSURE
A, Bank Parcel Closure shall be identified as the event when the Sponsor is relieved of all of
its responsibilities to the Bank Parcel and there are no Riparian Buffer Credits or Nutrient
Offset Credits left to sell.
13

B. Bank Parcel Closure shall commence only after all of the following events have occurred:
1. Transfer or assign the conservation easement and all of its interests, in perpetuity,
to a land trust or stewardship program as described in Section V of this Instrument.
2. All five years of monitoring completed and all monitoring reports submitted and
approved by DWR.
3. All credits have been released and debited and updated ledgers showing zero credit
balances have been submitted and approved by DWR.
XI. GENERAL PROVISIONS FOR THE BANK PARCEL
A. Upon the presentation of proper credentials, and during normal business hours, the Sponsor
and the landowner shall grant permission to the Director of DWR, and/or an authorized
representative of the Director of DWR, to enter the property containing the Bank Parcel.
B. Amendments: This Banking Instrument may be amended or modified only with written
approval of all signatory parties.
C. Any transfer of the Sponsor's rights or obligations outlined in this Instrument or any other
agreement referenced in this Instrument to a third party must be approved by DWR prior
to the transfer.
D. Force Majeure: After 100% of all of the credits have been released according to the credit
release schedule in Section VIII and confirmation has been received by the DWR that the
Conservation Easement has been successfully assigned in compliance with Item I -I of
Section V, the Sponsor will not be responsible for Bank failure that is attributed to natural
catastrophes including but not limited to flood, drought, disease, regional pest infestation,
etc. that are beyond the control of the Sponsor.
E. However, if an event occurs before 100% of all of the credits have been released according to
the credit release schedule in Section Vill, the Sponsor shall take remedial action to restore
the property to its condition prior to the event, in a manner sufficient to provide adequate
offset and mitigation to cover credits that were sold prior to the occurrence of the event.
Such remedial action shall be taken by the Sponsor only to the extent necessary and
appropriate, as determined by DWR and the Sponsor.
DIYR must concur in writing that a force majeure event has occurred for this provision to apply.
F. Oversight: Actions taken by DWR may include, but are not limited to, the following:
1. Site visits,
2. Mitigation determinationshnitigation viability assessments
14

3. Issuance of Site Viability Letters,
4. BPDP review and approval of items listed in Section V of this Instrument,
5, As -Built Report review and approval of items listed in Section VI of this
Instrument,
6. Monitoring Report review and approval of items listed in Section VI of this
Instrument,
7. Credit Ledger review and approval of items listed in Section IX of this Instrument,
R. Certificate review of items listed in Section IX of this Instrument and cross analysis
to credit ledgers and,
9, Information requests, file reviews and audits
Reports, ledgers, files and other information shall be made available to DWR upon request, unless
otherwise specified in this or any other document.
G. Validity of the Banking Instrument. This Instrument will become valid on the date of the
last party's signature.
H. Specific Language of Banking Instrument Shall Be Controlling: To the extent that specific
language in this document changes, modifies, or deletes terns and conditions contained in
those documents that are incorporated into the Instrument by reference, and that are not
legally binding, the specific language within the Instrument shall be controlling.
I. Any disputes over decisions regarding this Instrument, shall be referred to the Director of
DWR for a decision. The Director's decision is subject to review as provided in Articles
3 and 4 of G.S. 150B.
J. This Agreement shall be binding upon the parties and is entered into knowingly,
intelligently, and voluntarily.
K. Notices: All notices and other communications which may be or are required to be given
or made by any party to the other shall be in writing and shall be deemed to have been
properly given and received on the date delivered in person, received via electronic mail,
or deposited in the United States mail, registered or certified, return receipt requested, to
the addresses set out below, or at such other addresses as specified by written notice
delivered in accordance herewith.
If to Bank Sponsor: Restoration Systems
Attn: Barrett Jenkins
1101 Haynes Street, Suite 211
Raleigh, NC 27605
15

If to DWR: NC Division of Water Resources — 401 & Buffer Permitting Branch
Attn: Nutrient Offset Banking Coordinator
1617 Mail Service Center
Raleigh, NC 27699-1617
L. Applicable Law: This Agreement shall be construed under the laws of the State of North
Carolina.
RESTORATION SYSTEMS, LLC
.7—{Print)
Title--/
Date: �av
NORTH CAROLINA DEPARTMENT OF
WATER RESOURCES
By:
IRONMENTAL QUALITY -DIVISION OF
(Print)
(Signature)
Title: '
Date: /sue
16

ATTACHMENT
A — Division of Water Resources Authority Document

Updated
Nutrient Offset Program & Buffer Mitigation Program 10/28/2019
Authorities for MBI
ATTACHMENT A
Authorities pertaining to the GUC Mitigation Banking Instrument
All Basins
General Statutes:
G.S. §143-214.11 Ecosystem Enhancement Program
G.S. §143-214.26 Nutrient Offset Credits
G.S. §143-214.20-24 Riparian Buffer Protection Program
G.S. § 143-214.7 Stormwater runoff rules and programs
G.S. §143-215.8B Basinwide Water Quality Management Plans
Session Laws
S.L.2015-246
S.L. 2015-149
S.L.2014-90
S.L.2014-120
S.L.2013-413
S.L.2013-121
S.L. 2013-265
S.L. 2012-200 (Amendment to G.S. §143-214.23 and G.S. §143-215.1)
S.L. 2011-343 (Amendment to G.S. §143-214.11)
S.L. 2009- 337 (Amendment to G.S. § 143-214.11)
Administrative Rules:
15A NCAC 02B..0202 Definitions
15A NCAC 02B .0223 Nutrient Sensitive Waters
15A NCAC 02B .0237 Best Management Practice Cost -Effectiveness Rate
15A NCAC 02B .0240 Nutrient Offset Payments
15A NCAC 02B .0295 Mitigation Program Requirements for Protection and Maintenance of Riparian Buffers
Tar -Pamlico River Basin Buffer and Tar -Pamlico Nutrient Strategy
Session Laws
S.L. 2019-86 (Amendment to G.S. § 143-214.26)
S.L. 2011-394
S.L. 1999-329 (part of G.S. § 143B-282)
Administrative Rules:
15A NCAC 2B .0229 Nutrient Offset Payments for Non -Tar -Pamlico Basin Association Members
15A NCAC 2B .0255 Agricultural Nutrient Loading Goals
15A NCAC 2B .0256 Agricultural Nutrient Control Strategy
15A NCAC 2B .0257 Nutrient Management
15A NCAC 2B .0258 Basinwide Stormwater Requirements
15A NCAC 2B .0259 Protection and Maintenance of Existing Riparian Buffers
15A NCAC 2B .0261 Delegation of Authority for the Protection and Maintenance of Existing Riparian Buffers

ATTACHMENT
B - NCDWR - Methodology & Calculations for Nutrient Reductions on the Bank Parcel

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