HomeMy WebLinkAbout20201937 Ver 3_Signed NOBI_20211117DocuSign Envelope ID: 5707CD1A-BAF6-411A-853C-7EF407D0539C
Itov COOPER
Governor
ELIZABETH S. BISER
Secretary
S. DANIEL SMITH
Director
NORTH CAROLINA
Environmental Quality
November 10, 2021
TO: Danny Smith
Director
FROM: Katie Merritt
Nutrient Offset & Buffer Banking Coordinator
THROUGH: Paul Wojoski
Supervisor - 401 & Buffer Permitting Branch
SUBJECT: Division Approval of the Dead Tree Umbrella Nutrient Offset Banking Instrument
for Nutrient Offset Credits pursuant to the Tar -Pamlico Nutrient Management Strategy for
Restoration Systems, LLC.
The attached final Umbrella Nutrient Offset Umbrella Banking Instrument (NOBI) between
Restoration Systems, LLC and the Division of Water Resources was placed on public notice and
made available for public comments on October 25, 2021. The public comment period ended on
November 9, 2021 and no comments were received on the draft NOBI.
DEQ Legal counsel assisted with and agrees with the final template for which all our NOBI
documents are drafted from. I have reviewed the attached NOBI and it is ready for your
approval. Please sign on page 15 and return the document to me for final execution.
D E Q�� North Carolina Department of Environmental Quality I Division of Water Resources
512 North Salisbury Street 11617 Mail Service Center I Raleigh, North Carolina 27699-1617
IJORTHCARouhW
aewsM oeimm.,rtni a�aar 919.707.9000
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AGREEMENT TO ESTABLISH THE RESTORATION SYSTEMS' DEAD TREE
NUTRIENT OFFSET UMBRELLA BANKING INSTRUMENT IN THE TAR-PAMLICO
RIVER BASIN FOR NUTRIENT OFFSET CREDITS PURSUANT TO THE TAR-
PAMLICO NUTRIENT MANAGEMENT STRATEGY
TABLE OF CONTENTS
I. PREAMBLE.......................................................................................................................................1
II. LOCATION AND GEOGRAPHIC SERVICE AREA...................................................................... 1
III. AUTHORITIES..................................................................................................................................2
IV. ESTABLISHMENT OF BANK PARCEL........................................................................................ 2
V. BANKPARCEL DEVELOPMENT PACKAGE ..............................................................................4
VI. POST CONSTRUCTION DOCUMENTATION FOR THE BANK PARCEL ................................ 6
VII. CALCULATION OF CREDITS FOR THE BANK PARCEL.......................................................... 9
VIII. CREDIT RELEASE SCHEDULE................................................................................................... 10
IX. PROCEDURE FOR DEBITING AND CREDITING....................................................................11
X. BANK PARCEL CLOSURE........................................................................................................... 12
XI. GENERAL PROVISIONS FOR THE BANK PARCEL.................................................................13
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ATTACHMENTS
A Division of Water Resources Authority Document
B — Ledger Templates
C —Project Credit Table
REFERENCES
1. Nutrient Offset Payment Rule 15A NCAC 02B .0703:
http://reports.oah. state.nc.us/ncac/title%2015 a®/o20-%20environmental%20quality/chapter%2002%20-
�/ o20environmental%20management/subchapter%20b/ 15 a%20ncac%2002b%20.0703 .pdf
2. Riparian Buffer Mitigation Rule 15A NCAC 0213.0295:
htlp://reports.oah. state.nc.us/ncac/title%2015 a®/o20-%20environmental%20quality/chapter%2002%20-
%20environmental%20management/subchapter%20b/ 15 a%20ncac%2002b%20.0295.pdf
3. NC Session Law 2019-86 "Nutrient Offset Credits":
https://ncleg_gov/EnactedLegislation/SessionLaws/HTML/2019-2020/SL2019-86.html
4. Buffer Interpretation/Clarification #2008-019 for diffuse flow:
htlps:Hfiles.nc. gov/ncdeg/Water%20Qualijy/Surface%20Water%20Protection/401 /Buffer%20Clarification%20M
emos/Diffuse-Flow-for-Buffer-Mitigation-Sites-Buffer-Clarification-Memo-20080819.pdf
5. Clarified Procedures for Calculating Buffer Mitigation Credits and Nutrient Offset Credits (Nov 2019):
https:Hfiles.nc. gov/ncdegAVater%20Quality/Surface%20Water%20Protection/401 /1\4itigation/Issues---
Resolutions-Ver-1.0-buffer-mitigation-nutrient-offset.pdf
6. NCDWR — Methodology and Calculations for Nutrient Reductions on the Bank Parcel:
htips:Hfiles.nc. gov/ncdeq/Water%200ualily/Planning/NPU/Nutrient%20Offset%20Rule/Ag-Buffer-
Credit.pdf
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I. PREAMBLE
This Umbrella Nutrient Offset Banking Instrument ("Instrument") regarding the
establishment, use, operation, and maintenance of the two Nutrient Offset Bank Parcels
("Bank Parcels"), further identified in Section II, is to provide Tar -Pamlico Nutrient Strategy
nutrient load reduction credits ("Nutrient Offset Credits"), is made and entered into by and
among Restoration Systems, LLC 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 .0703 and 15A NCAC 02B .0295, see
references. This instrument covers two individual bank parcels/sites, Dead Tree Phase A and
Dead Tree Phase B.
The purpose of the Bank is:
A. To establish, restore and preserve riparian vegetation adjacent to streams and agricultural
ditches with the intent to improve water quality along unnamed tributaries to the Tar -
Pamlico River within the Tar -Pamlico River Basin.
B. To convert agricultural land uses within riparian areas adjacent to streams and agricultural
ditches into a dense and diverse hardwood vegetated state with the intent to significantly
reduce nutrient loadings associated with agricultural practices into streams and ditches.
C. To provide nutrient offset and sell any resulting 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.
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 Nutrient Offset Credits for impacts requiring such mitigation
or offset.
B. The Dead Tree A Bank Parcel and the Dead Tree B Bank Parcel are comprised of land in
Edgecombe County on four adjacent parcels owned by a single family. The land is
currently and has been historically utilized for agricultural production
C. The GSA for each Bank Parcel under this instrument is limited to the following:
Dead Tree Phase A - Tar -Pamlico River Basin in the State of North Carolina,
United States Geological Survey ("USGS") 8-digit Hydrologic Unit Code ("HUC")
03020101.
2. Dead Tree Phase B - Tar -Pamlico River Basin in the State of North Carolina, United
States Geological Survey ("USGS") 8-digit Hydrologic Unit Code ("HUC")
03020102
D. Sale or transfer of Nutrient Offset Credits from the Dead Tree Phase A Bank Parcel shall
be limited to the 8-digit HUC 03020101 in the Tar -Pamlico River Basin, in accordance
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with 15A NCAC 02B .0703, unless otherwise authorized by the DWR in accordance with
Session Law 2019-86.
E. Sale or transfer of Nutrient Offset Credits from the Dead Tree Phase B Bank Parcel shall
be limited to the 8-digit HUC 03020102 in the Tar -Pamlico River Basin, in accordance
with 15A NCAC 02B .0703, unless otherwise authorized by the DWR in accordance with
Session Law 2019-86.
F. Table 1 provides site -specific details of the Bank Parcels proposed under this Instrument.
Table 1.0 —Bank Parcel Details
Bank Parcel
8-Digit
Name/DWR
County
USGS
Project
Named Receiving
Primary
Project #
Hydrologic
Location
Stream
Land Use
Unit Code
Dead Tree
Fishing Creek &
Agricultural
Phase A/
Edgecombe
03020101
Whitakers
Maple Swamp
Crops
2020-1937v2
Dead Tree
Agicultural
Phase B/2020-
Edgecombe
03020202
Whitakers
White Oak Swamp
Crops
19370
IILAUTHORITIES
A. The Bank will be used to provide 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 Parcels approved under this Instrument,
shall be consistent with approved State statutes and rules for the Tar -Pamlico Nutrient
Management Strategy.
D. Nutrient offset activities proposed under this Instrument and corresponding Bank Parcel
Development Packages (BPDPs) to generate Nutrient Offset Credits shall be consistent
with State statutes and rules for the Tar -Pamlico Nutrient 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 .0703, DWR has provided
a "Site Viability Letter" for each of the Bank Parcels proposed under this Instrument. The
site viability letter is not an approval of the 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
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meet general criteria to be suitable to generate Riparian Buffer Credits and Nutrient Offset
Credits. Table 2.0 below outlines when the Site Viability Letter was issued by NCDWR
for the Bank Parcels proposed under this instrument:
Table 2.0 — Site Viability Letter Details
Bank Parcel
NC DWR Site Visit
Viability Letter
Viability Letter
Received
Expiration Date
Dead Tree Phase A
December 20, 2020
May 11, 2021
May 11, 2023
Dead Tree Phase
December 20, 2020
May 14, 2021
May 14, 2023
B
January 5, 2021
B. A valid Site Viability Letter is required prior to submittal of each 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 two (2) Bank Parcels proposed for inclusion under this Instrument shall each require
a BPDP be submitted to, and approved by, the DWR prior to use of the Bank Parcel for
nutrient offset purposes or sale or transfer of any associated credits. The contents of the
BPDP are provided in Section V.
D. Each BPDP submitted under this instrument will be placed on public notice and made
available for public commenting for 15 calendar days.
E. In general, the Sponsor expects all Nutrient Offset Credits to be generated through riparian
restoration.
F. Nutrient Offset Credit on these two (2) Bank Parcels may be achieved through restoration
of the riparian areas adjacent to viable streams and viable ditches where agriculture is the
predominant land use as determined by DWR. 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 banks along viable streams and viable ditches . The width of
the restoration area should begin at the most landward limit of the top of bank or the rooted
herbaceous vegetation (if present along streams) and extends landward a minimum of 50
feet and a maximum of 200 feet on all sides of the surface waters. A conservation easement
will be secured to include the tops of all stream channel and ditch banks and will extend
out a maximum of 200 feet. The viability of features to generate nutrient offset credits is
provided in the Site Viability Letters for the Bank Parcels and referenced in Table 2.0 of
this Instrument.
G. The Bank Parcels are expected to provide Nutrient Offset Credits as follows:
1. Converting agricultural land uses within riparian areas to non-agricultural land uses
by placing a perpetual conservation easement around riparian areas along viable
streams and viable ditches in accordance with 15A NCAC 02B .0703 (g).
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2. Planting hardwood trees or trees and shrubs on a Restoration Site as defined in 15A
NCAC 02B .0295 (b) adjacent to viable streams and viable ditches where
agriculture has been determined by DWR to be the predominant land -use.
3. Diffused flow will be maintained onsite. The Buffer Interpretation/Clarification
Memo #2008-019 may be applied where maintenance of diffuse flow onsite is
unattainable, see reference 4.
G. The total area of riparian restoration activities on the Dead Tree Phase A Bank Parcel is
expected to be 60.27 acres and 124.30 acres on the Dead Tree Phase B Bank Parcel.
V. BANK PARCEL DEVELOPMENT PACKAGE
A. Each 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. Each BPDP will
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. Each 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 nutrient offset
activities including a detailed vegetation plan; 4) monitoring and maintenance plans; 5)
financial assurances; 6) a Project Credit Table (see Attachment C) showing associated
nutrient credit calculations, which shall include credit generation, service area, and
accounting as appropriate for each regulatory authority; 7) stream determination letter from
DWR; 8) Site Viability Letter from DWR, 9) service area figure for each mitigation type
proposed under this Instrument; and 10) all pertinent information including but not limited
to permitting, bank stabilization, culvert removal, installation of any utilities indirectly or
directly affecting the Bank Parcel, endangered or threatened species, presence of historical
sites and an Environmental Data Resources (EDR) report to evaluate environmental risk
associated with the land proposed for the Bank Parcel.
B. The Sponsor will obtain all applicable federal, state, and local documentation, permits, or
authorizations needed to construct and maintain each Bank Parcel. This Instrument does
not qualify as, or substitute for, such documentation, permit, or authorization.
C. Any restoration activities or proposed construction within stream channels, riparian buffers
and other riparian areas on the Bank Parcel to produce 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.
Property Disposition & Long -Term Management for the Bank Parcel
E. Prior to the release of any credits, the Sponsor shall record permanent conservation
easements at the Edgecombe County Register of Deed's office that is sufficient to ensure
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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 Trust Accreditation Commission
and/or has been approved by DWR. A land trust must be certified under 501(c)(3) of the
Internal Revenue Code.
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 Bank Parcel Development
Following approval of each Bank Parcels' 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, according to the
approved 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 of the riparian restoration activities and other related activities for the
construction of the Bank Parcel as described in the approved BPDP. No bond shall be less
than $150,000.00 to cover construction costs. Each Bank Parcel will be bonded
individually.
L. Alternatively, in lieu of posting Performance Bonds, the Sponsor may elect to construct
the Bank Parcel, in its entirety, prior to the first credit release.
M. Once DWR has released all credits for completion of all items listed below, then the
Sponsor will be released from its performance obligations under the performance bond
required in Item J and K of this section:
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1. Instrument and BPDP Approved by DWR, Conservation Easement Recorded,
Financial Assurance Posted;
2. All Riparian Earthwork, Planting, and Installation of Monitoring Devices
Completed, easement boundaries adequately marked, all applicable permits
obtained, site visit performed by DWR;
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 EACH 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 Tar -Pamlico
Riparian Buffers or other riparian areas until Item B (1) and (2) of Section X have been
satisfied.
B. Within 30 calendar days after completing the establishment of the nutrient offset areas, the
Sponsor will submit written notification to DWR documenting that all nutrient offset
activities have been completed. Failure to submit written notification within 30 days may
result in a modified credit release schedule or a delay in the issuance of credit releases.
Notification shall include all the following:
1. Short summary of activities completed as required per the approved BPDP;
2. Figures representing all riparian restoration, riparian enhancement and riparian
preservation activities where applicable;
3. Figures representing location of all monitoring plots installed;
4. Detailed planting plan- including type of species planted, density of species planted,
and any modifications to the planting plan from what was approved in the BPDP;
5. Description of how the conservation easement boundaries were marked;
6. Any major changes to the conservation easement boundary or to the amount of
Nutrient Offset Credits from what was proposed in the approved BPDP.
C. The Sponsor will submit an as -built plan and report for each Bank Parcel separately, after
completing the establishment of the nutrient offset areas. Each As -built Report will be
submitted to DWR and describe any deviation from the approved BPDP and will document
all the following:
1. Riparian restoration and planting details, invasive species control, confirmation of
fence installation if applicable, cattle exclusions if applicable, confirmation that all
easement boundary markers are installed, monitoring device locations, vegetation
plot locations and photo point locations as appropriate, and confirmation that all
boundary markers are installed.
2. Boundary Survey of the conservation easement area, signed and sealed by a
licensed surveyor, including an inventory of the final nutrient offset areas in both
square feet and acres.
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3. As -built map of the nutrient offset areas showing where riparian restoration was
performed and any deviations to the Bank Parcel from what was approved in the
BPDP.
4. Aerial map of the riparian restoration activities approved in the BPDP.
Financial Assurance for Bank Parcel Monitoring and Maintenance
D. After completion of the riparian restoration activities and construction on each Bank Parcel,
in its entirety, a separate Performance/Maintenance Bond 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. The Bond 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 each annual bond
renewal.
E. Each Performance/Maintenance Bond shall be secured each year for a minimum of five
years, and until DWR has released all Nutrient Offset Credits to the Sponsor. Upon DWR
approval, the bond 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 initially.
F. Once DWR has released 100% of all credits for completion of all Bank Parcel milestones
described in Table 3 of Section VIII and in the corresponding BPDP, the Sponsor will be
released from its performance obligations under the performance bond required in "C-D"
of this Section.
G. To comply with this section, DWR must be the Obligee on all performance bonds.
Monitoring and Maintenance Reports
H. The Sponsor shall monitor each Bank Parcel, in its entirety, 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 Bank
Parcel.
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 50% of the
planted stems. A list of species for planting will be detailed in each BPDP for approval.
Some native hardwood tree volunteer species may be included to meet performance
standards as determined by the DWR.
A "stem" means a woody seedling, sapling, shrub or tree, no less than 10 centimeters in
height and shall apply, on this Bank Parcel, as the minimum height that a planted tree or
shrub shall be at initial planting. Volunteer stems that are less than 10 centimeters shall
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not be quantified and included in the annual vegetation data included with the monitoring
reports.
K. If the performance standards of the vegetation are not met for an individual Bank Parcel,
supplemental plantings may be 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.
L. Monitoring Reports for 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 for each Bank Parcel no later than December 31 of each year
for a minimum of five consecutive years after the first full growing season for each Bank
Parcel under this Instrument. Vegetation data shall not be collected prior to late August
of each year. 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:
1. 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 and height data 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/debit ledgers; and
6. Corresponding verification letters from designated local governments upon request;
and
7. Corresponding Mitigation Transfer Certificates upon request; and
Proof of performance bond renewal to cover the next monitoring year (when
applicable).
Contingency Plans/Remedial Actions
M. In the event a Bank Parcel fails to achieve the performance criteria described in this
Instrument and the approved BPDP, the Sponsor shall develop necessary contingency plans
in coordination with the DWR and implement appropriate remedial actions for the Bank
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Parcel and the Bank. Depending on the degree of remedial actions required, the DWR may
modify the monitoring period.
VII. CALCULATION OF CREDITS
Nutrient Offset Credits
A. The square footage of Nutrient Offset Credits on both Bank Parcels proposed under this
Instrument is determined by applying the applicable ratio as provided in 15A NCAC 02B
.0295(m) for a Restoration Site following the guidance provided in the Clarified
Procedures for Calculating Buffer Mitigation Credits and Nutrient Offset Credits issued
by the DWR, including the most recent Project Credit Table Template (see references 5
and Attachment C respectively). All riparian areas proposed for Nutrient Offset Credits
must be a minimum of fifty (50) feet from the top of the banks along viable streams and
viable ditches on land noted in a Site Viability Letter as agriculture.
B. Nutrient Abatement of Restored Riparian Area/Buffers on Agricultural lands: The Sponsor
and DWR agree to the following:
a. The pounds of nitrogen offset per acre of restored riparian areas/buffers
shall be 2,273.02 pounds per acre or 19.16394 square feet per pound.
b. The pounds of phosphorus offset per acre of restored riparian areas/buffers
shall be 146.40 pounds per acre or 297.54099 square feet per pound.
C. The Sponsor and DWR agree that the methodology and calculations for determining
nitrogen and phosphorus reduction, associated with restoration of riparian areas on these
two (2) Bank Parcels 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 Parcels. For further details on the approved method and calculations for
determining nutrient reductions with the riparian restoration on this Bank Parcel, refer to
the NCDWR — Methodology & Calculations for Nutrient Reductions on the Bank Parcel
document found in reference 6.
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VIIL CREDIT RELEASE SCHEDULE
A. Upon submittal of all appropriate documentation by the Sponsor, and subsequent approval
by DWR, it is agreed that Nutrient Offset Credits associated with the Dead Tree Phase A
and Dead Tree Phase B Bank Parcels will become available to sell to a third party in
accordance with the Credit Release Schedule in Table 3.0.
Table 3.0 - Credit Release Schedule for Nutrient Offset Credits
% Credit
Task
Project Milestone
Available for
Sale
I
Instrument and BPDP Approved by DWR, Conservation Easement
20
Recorded*, Financial Assurance Posted
All Riparian Earthwork, Planting and Installation of Monitoring Devices
2
Completed, Easement Boundaries adequately marked, and all applicable
20
permits obtained. A site visit by DWR is required for this task.
3
Monitoring Financial Assurance Posted and Approval of As -Built Report
10
4
Monitoring Report #1: Approved by the DWR** & financial assurance
10
renewed
5
Monitoring Report #2: Approved by the DWR** & financial assurance
10
renewed
6
Monitoring Report #3: Approved by the DWR** & financial assurance
10
renewed
7
Item B (1) of Section X in this Instrument has been completed and
5
approved by DWR.
No remaining credits will be released until the conservation easement has
been assigned to an approved land trust or stewardship
8
Monitoring Report #4: Approved by the DWR** & financial assurance
5
renewed
9
Monitoring Report #5: Approved by the DWR** and final site visit by
10
DWR has been conducted
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
B. 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.
C. Any major deviations to the Bank Parcel that were not authorized in writing by DWR prior
to implementation may affect the amount of nutrient offset credits that will be generated
by the Bank Parcel.
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IX. PROCEDURE FOR DEBITING AND CREDITING FOR EACH BANK PARCEL
Credit Ledgers
A. The Sponsor shall maintain one credit ledger for each mitigation type for each Bank Parcel
proposed under this Instrument, unless otherwise instructed by DWR in the approved
BPDP: Each Bank Parcel will have a separate credit ledger. Credit ledgers shall provide
the accounting for Nutrient Offset Credits in pounds and square feet.
B. Each credit ledger shall be submitted on a separate 8 '/2-in X 11-in spreadsheet with legible
font style and font size. All ledgers shall be submitted using the templates provided in
Attachment B of this Instrument or any updated versions to these templates as provided by
DWR.
Credit Processing
C. Nutrient Offset Credits generated on Dead Tree Phase A Bank Parcel will be used to offset
nitrogen and phosphorus nutrient loads within the 8-digit HUC 03020101 of the Tar -
Pamlico River Basin in accordance with 15A NCAC 02B .0703.
D. Nutrient Offset Credits generated on Dead Tree Phase B Bank Parcel will be used to offset
nitrogen and phosphorus nutrient loads within the 8-digit HUC 03020102 of the Tar -
Pamlico River Basin in accordance with 15A NCAC 02B .0703.
E. Credits must be calculated for each Bank Parcel using the most recent Project Credit Table
template, see Attachment C, which is referenced in the guidance provided in the Clarified
Procedures for Calculating buffer Mitigation Credits and Nutrient Offset Credits letter
issued by the DWR, see reference 5.
F. The Sponsor shall obtain written verification of nutrient offset need from a designated local
government within the 03020101 HUC 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 Dead Tree Phase A Bank Parcel.
G. The Sponsor shall obtain written verification of nutrient offset need from a designated local
government within the 03020102 HUC 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 Dead Tree Phase B Bank Parcel.
H. 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 each Bank Parcel by the tenth (loth) 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
DocuSign Envelope ID: 5707CD1A-BAF6-411A-853C-7EF407D0539C
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.
Mitigation Credit Transfer Certificates
I. 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) Sponsor Name, (2) Bank Parcel name as it appears in Table 1.0,
(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.
3. 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 with impacts, (5 — when applicable)
designated local government or DWR requiring Nutrient Offset Credits and (6)
credit type and amount required for project.
J. If the DWR determines that the Bank is operating at a deficit (e.g., the Sponsor is utilizing,
selling, leasing and/or transferring credits that are not available), or the Bank is selling or
transferring credits 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 for each Bank Parcel under this Instrument shall be identified as the
event when the Sponsor is relieved of all its responsibilities to the Bank Parcel and there
are no Nutrient Offset Credits left to sell.
B. Bank Parcel Closure shall commence only after all the following events have occurred:
1. Transfer or assign the conservation easement and all 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.
DocuSign Envelope ID: 5707CD1A-BAF6-411A-853C-7EF407D0539C
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 EACH 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
(s).
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 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 H 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 the credits have been released according to the
credit release schedule in Section VIII, 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.
DWR 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. Issuance of Site Viability Letters,
3. BPDP review and approval of items listed in Section V of this Instrument,
4. As -Built Report review and approval of items listed in Section VI of this
Instrument,
5. Monitoring Report review and approval of items listed in Section VI of this
Instrument,
6. Credit Ledger review and approval of items listed in Section IX of this Instrument,
DocuSign Envelope ID: 5707CD1A-BAF6-411A-853C-7EF407D0539C
7. Certificate review of items listed in Section IX of this Instrument and cross analysis
to credit ledgers and,
8. 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 terms 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.
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 Sponsor: Restoration Systems, LLC
Attn: Barrett Jenkins
1101 Haynes Street, Suite 211
Raleigh, NC 27605
bjenkins@restorationsystems.com
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
DocuSign Envelope ID: 5707CD1A-BAF6-411A-853C-7EF407D0539C
L. Applicable Law: This Agreement shall be construed under the laws of the State of North
Carolina.
RESTORATION SYSTEMS, LLC
By: George Howard ( rint)
-�-- � (Signature)
Title: CEO
10/22/2021
Date:
NORTH CAROLINA DEPARTMENT OF ENVIRONMENTAL QUALITY -DI V I S I ON OF
WATER RESOURCES
Danny Smith
By: (Print)
(Signature)
Title: Director, Division of Water Resources
11/10/2021
Date:
DocuSign Envelope ID: 5707CD1A-BAF6-411A-853C-7EF407D0539C
ATTACHMENT A — Division of Water Resources Authority Document
DocuSign Envelope ID: 5707CD1A-BAF6-411A-853C-7EF407D0539C
Updated
Nutrient Offset Program & Buffer Mitigation Program 10/28/2019
Authorities for MBI
ATTACHMENT A
Authorities pertaining to the Dead Tree Umbrella 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. 2019-86 (Amendment to G.S. §143-214.26)
S.L. 2016-94
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 .0701 Nutrient Strategies Definitions
15A NCAC 02B .0703 Nutrient Offset Credit Trading
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 02B .0610 Managing Activities within Riparian Buffers: Definitions
15A NCAC 02B .0611 Managing Activities within Riparian Buffers: Authorization Certificates
15A NCAC 02B .0612 Managing Activities within Riparian Buffers: Forest Harvesting Requirements
15A NCAC 02B .0715 Delegation of Authority for the Protection and Maintenance of Existing Riparian Buffers
15A NCAC 02B .0730 Tar -Pamlico Nutrient Strategy Purpose & Scope
15A NCAC 02B .0731 Tar -Pamlico Nutrient Strategy Stormwater
15A NCAC 02B .0732 Tar -Pamlico Nutrient Strategy Agriculture
15A NCAC 02B .0733 New and Expanding Wastewater Discharge Requirements
15A NCAC 02B .0734 Protection and Maintenance of Existing Riparian Buffers
DocuSign Envelope ID: 5707CD1A-BAF6-411A-853C-7EF407D0539C
ATTACHMENT B — Ledger Templates
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ATTACHMENT C — Project Credit Table Template
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