20210348 Ver 3_MBI_FINAL_05272022_20220527

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Katie Merritt
Initial Review Completed Date 05/27/2022
Mitigation Project Submittal - 5/27/2022
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Stream Wetlands Buffer Nutrient Offset
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Jamey McEachran
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20210348
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DMS • Mitigation Bank
Pickle Creek Phase II Nutrient Offset Site
Wayne
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Mitigation Bank Instrument
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RES_PickleCrk_Phasell_MBI_FINAL_05272022.pdf 562.85KB
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Jamey McEachran
/ llefileitha

AGREEMENT TO ESTABLISH THE RES PICKLE CREEK PHASE II NUTRIENT
OFFSET BANKING INSTRUMENT IN THE NEUSE RIVER BASIN FOR NUTRIENT
OFFSET NHTIGATION CREDITS PURSUANT TO THE NEUSE NUTRIENT
MANAGEMENT STRATEGY
TABLE OF CONTENTS
I.
PREAMBLE.......................................................................................................................
2
II.
LOCATION AND GEOGRAPHIC SERVICE AREA ......................................................
2
III.
AUTHORITIES..................................................................................................................
3
IV.
ESTABLISHMENT OF BANK PARCEL.........................................................................
3
V.
PRE -CONSTRUCTION DOCUMENTATION.................................................................
5
VI.
POST CONSTRUCTION DOCUMENTATION...............................................................
7
VII.
CALCULATION OF CREDITS......................................................................................
10
VIII.
CREDIT RELEASE SCHEDULE....................................................................................
11
IX.
PROCEDURE FOR DEBITING AND CREDITING CREDITS ....................................
12
X.
BANK PARCEL CLOSURE............................................................................................
13
XI.
GENERAL PROVISIONS FOR THE BANK PARCEL .................................................
13
ATTACHMENTS
A - Division of Water Resources Authority Document
B - Ledger Templates
C — Project Credit Table (example)
References
1. Nutrient Offset Credit Trading Rule 15A NCAC 02B .0703:
http://reports.oah.state.nc.us/ncac/title%2015a%20%20environmental%2Ogualit /y chapter%2002%20-
%20environmental%20management/subchapter%20b/ 15 a%20ncac%2002b%20.0703.pdf
2. Riparian Buffer Mitigation Rule 15A NCAC 02B .0295:
http://reports.oah. state.nc.us/ncac/title%2015a%20%20environmental%2Oguality/chapter%2002%20-
%20environmental%20management/subchapter%20b/ 15 a%20ncac%2002b%20.0295.pdf
3. NC Session Law 2019-86 "Nutrient Offset Credits":
https://www.ncleg.gov/Sessions/2019/Bills/House/PDF/H812v3.pd
4. Buffer Interpretation/ Clarification # 2008- 019 for diffuse flow:
https://files.nc.gov/ncdegAVater%200uality/Surface%2OWater%2OProtection/401 Buffer%200arification
%20Memo s/Diffuse-Flow-for-Buffer-Mitigation-Sites-Buffer-Clarification-Memo-20080819.pdf
5. Clarified Procedures for Calculating Buffer Mitigation Credits and Nutrient Offset Credits
(November 2019):
hops://files.nc.gov/ncdegAVater%200uality/Surface%2OWater%2OProtection/401 /Mitigation/Issues---
Re solutions-Ver-1.0-buffer-mitigation-nutrient-offset.pdf
6. NCDWR — Methodology and Calculations for Nutrient Reduction on the Bank Parcel:
https://file s.nc. gov/ncdeg/Water%200uality/Plaming/NPU/Nutrient%200ffset%2ORule/Ag-Buffer-
Credit.pdf
1

I. PREAMBLE
This RES Pickle Creek Phase II Nutrient Offset Banking Instrument ("Instrument") regarding
the establishment, use, operation, and maintenance of Pickle Creek Phase II Bank Parcel
("Bank Parcel"), identified in Section II, to provide Neuse Nutrient Strategy nutrient load
reduction credit ("Nutrient Offset Credits") is made and entered into by and among
Environmental Banc and Exchange, LLC acting 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 the Consolidated
Mitigation Rule 15A NCAC 02B .0295, which became effective on April 1, 2020 and
November 1, 2015 (References 1 and 2) respectively. This instrument is for one individual
bank site, Pickle Creek Phase II.
The purpose of the Bank Parcel is:
A. To establish and restore riparian vegetation adjacent to streams and/or agricultural ditches
with the intent to improve water quality, reduce nutrient loads, enhance flood attenuation,
and restore wildlife habitat within the Neuse River Basin (8-digit HC 03020201), excluding
the Falls Lake Watershed.
B. To convert agricultural land uses, including land currently being used for the application
of waste from a certified animal feeding operation, 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 offsets and sell any resulting Nutrient Offset Credits to third parties in
the Neuse River Basin, for development (both existing and proposed) or to offset NPDES-
permitted wastewater nutrient sources requiring such mitigation or offset.
IL 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 GSA for the Bank Parcel under this instrument is limited to the United States
Geological Survey ("USGS") 8-digit Hydrologic Unit Code ("HUC") 03020201 of the
Neuse River Basin, excluding the Falls Lake Watershed in the State of North Carolina.
C. Sale or transfer of Nutrient Offset Credits shall be limited to 8-digit HUC 03020201 in the
Neuse River Basin, excluding the Falls Lake Watershed, in accordance with 15A NCAC
02B .0703, unless otherwise authorized by the DWR in accordance with Session Law (S.
L.) 2019-86.
4

D. The Bank Parcel is comprised of land lying adjacent to an existing conservation easement
for the NC Division of Mitigation Services Full -Delivery Mitigation Site (Pickle Creek
Mitigation Site, DMS No. 100184, DWR ID# 2021-0348v2) and is currently used for row
crops and for application of animal waste associated with a certified animal feeding
operation permitted under AWS960127. Table 1.0 provides site -specific details of the Bank
Parcel proposed under this Instrument, which is within the Neuse River Basin (8-digit HUC
03020201).
Table 1.0 — Bank Parcel Details
Bank Parcel
8-Digit USGS
Project
Named
Primary Land
Name
DWR ID#
County
Hydrologic
Location
Receiving
Use/s
Unit Code
Stream
Pickle Creek
2021-03480
Wayne
03020201
35.231755,
Thunder
Agricultural
Phase II
-78.105739
Swamp
crops
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 ("State") statutes and
rules for the Neuse Nutrient Sensitive Waters Management Strategy.
C. The selling of credits generated from the Bank Parcel approved under this Instrument, shall
be consistent with approved State statutes and rules for the Neuse Nutrient Sensitive Waters
Management Strategy.
D. Nutrient offset activities proposed under this Instrument and the corresponding Bank Parcel
Development Package (BPDP) to generate Nutrient Offset Credits shall be consistent with
State statutes and rules for the Neuse Nutrient Sensitive Waters 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 the Bank Parcel 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 meet general criteria
to be suitable to generate Riparian Buffer Credits and Nutrient Offset Credits. Table 2.0
below outlines when a Site Viability Letter was issued by DWR for the Bank Parcel
proposed under this Instrument:

Table 2.0 — Site Viabilitv Letter Details
Bank Parcel
NC DWR Site Visit
Viability Letter
Viability Letter
Received
Expiration Date
Pickle Creek Phase II
March 1711, 2021
May 1811, 2021
May 18a', 2023
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 individual Bank Parcel for
nutrient offset purposes or for any sale or transfer of any associated credits. The contents
of the BPDP are provided in Section V.
D. The 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 may be achieved on the Bank Parcel through restoration of the
riparian areas adjacent to viable streams and viable ditches, where agriculture was
determined by DWR to be the predominant land use. All activities conducted within
riparian buffers and adjacent riparian areas for purposes of generating Nutrient Offset
Credits will be conducted in concurrence with or after the riparian restoration activities
proposed in the Pickle Creek Full Delivery Mitigation Plan (DMS No. 100184) and not
before. 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 extend perpendicular and landward from features 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 Parcel is expected to provide Nutrient Offset Credits as follows:
1. Converting agricultural land uses, including land currently being used for the
application of waste from a certified animal feeding operation, 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).
E

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.
E. The Bank Parcel submitted for review under this Instrument is anticipated to begin
construction of riparian activities in Spring 2022. The total area of riparian restoration
activities on the Pickle Creek Phase II Bank Parcel is expected to be 10.58 acres.
V. PRE -CONSTRUCTION DOCUMENTATION
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 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 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 buffer 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 the Bank Parcel and ensure that the
riparian areas proposed on the Bank Parcel to generate nutrient offset credits will not be
associated with a Waste Utilization Plan. This Instrument does not qualify as, or substitute
for, such documentation, permit, or authorization.
C. Any restoration activities or proposed construction within stream channels, the 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.
5

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
E. Prior to the release of any credits, the Sponsor shall record permanent conservation
easements at the Wayne 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 conservation easement for the Bank Parcel will be located adjacent to the conservation
easement for the DMS Pickle Creek Mitigation Site, which will include the tops of banks
of each stream, ephemeral channel and ditch proposed for riparian restoration and will
extend a minimum 50 feet perpendicular and landward from features. The conservation
easement for the Bank Parcel will include restored riparian areas beyond the DMS
conservation easement adjacent to features out to a maximum of 200 feet.
H. 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.
L The Sponsor agrees to 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 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.
J. 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
K. Following approval of the BPDP for the Bank Parcel, the Sponsor shall provide
Performance/Maintenance Bonds from a surety company that is rated no less than an "A-"
as rated by A.M. Best, to construct the sites 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.
no

L. The amount of each Performance Bond shall be 100% of the estimated cost for
implementation of the riparian restoration, enhancement, preservation, 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.
M. Alternatively, in lieu of posting Performance Bonds, the Sponsor may elect to construct
the Bank Parcel prior to the first credit releases.
N. For the Bank Parcel, once DWR has released all credits for completion of all the items
listed below, then the Bank Sponsor will be released from its performance obligations
under the performance bond required in Item J and K of this section:
1. Instrument and BPDP Approved by DWR, Full Delivery DMS Mitigation Plan
approved by DWR, Conservation Easement Recorded, Financial Assurance Posted;
2. All Riparian Site Earthwork, Planting and Installation of Monitoring Devices
Completed for both the Pickle Creek Full Delivery site (DMS ID# 100184) and the
Bank Parcel;
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
O. To comply with this section, DWR must be the Obligee on all performance bonds.
VI. POST CONSTRUCTION DOCUMENTATION
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 Neuse
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; and
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.
7

C. The Sponsor will submit an as -built plan and report for the Bank Parcel after completing
the establishment of the nutrient offset areas. The as -built report will describe any deviation
from the approved BPDP and will document the following:
Riparian restoration planting details and other construction activities that were
required in the BPDP, confirmation that all boundary markers are installed, invasive
species control, monitoring device locations, vegetation plot locations, and photo
point locations.
2. Boundary Survey of the conservation easement area, signed and sealed by a
licensed surveyor, including an inventory of the final Nutrient Offset Credits in
both square feet and acres.
3. As -built map of the nutrient offset areas showing where riparian restoration,
enhancement and/or preservation were performed and any deviations to the Bank
Parcel from what was approved in the BPDP.
4. Aerial map of the nutrient offset areas that was included in the approved BPDP.
Financial Assurance for Monitoring and Maintenance
D. After completion of the riparian restoration activities on the 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 applicable for each 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 annual bond renewals.
E. A 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 Bank Sponsor. Upon DWR
approval, the bond may be lowered for that next year's monitoring based on the adjusted
cost to complete the monitoring. No bond shall be less than $100,000 initially, to cover
monitoring and maintenance costs.
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 Bank Sponsor
will be released from its performance obligations under the performance bond required in
"D-E" of this Section.
G. To comply with this section, DWR must be the Obligee on all performance bonds.
93

Monitoring and Maintenance Reports
H. The Sponsor shall monitor the Bank Parcel 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 the Bank Parcel.
L 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 the BPDP for approval. Native
hardwood tree volunteer species may be included to meet performance standards as
determined by the DWR.
J. A "stem" means a woody seedling, sapling, shrub or tree, no less than 10 centimeters in
height and shall apply, on the Bank Parcel, to the minimum height that a planted tree or
shrub shall be at initial planting. Volunteer stems that are less than 10 centimeters shall 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, 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 on the date of acceptance of the BPDP. The Sponsor shall submit to the DWR 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 for the 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 each 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
6

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
8. Proof of performance bond renewal to cover the next monitoring year (if
applicable)
Contin2encv Plans/Remedial Actions
M. 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.
VIL CALCULATION OF CREDITS
Nutrient Offset Credits
A. The square footage of Nutrient Offset Credits on the Bank Parcel submitted under this
Instrument will be 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 provided online by
DWR, see reference 9 5 and Attachment C. All riparian areas proposed for Nutrient Offset
Credits must be a minimum of 50 feet from the top of banks along viable streams or viable
ditches on land noted in a Site Viability Letter as agriculture.
B. Nutrient Abatement of Restored Riparian Area/Buffers on agricultural land: 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 or 19.16394 square feet per pound.
C. The Sponsor and DWR agree the methodology and calculations for determining nitrogen
reduction, associated with restoration of riparian areas on the Bank Parcel as described in
Section IV of this Instrument, 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. For further details on the approved method and calculations
for determining nutrient reductions associated with the riparian restoration on this Bank
Parcel refer to the NCDWR - Methodology & Calculations for Nutrient Reductions
document found in reference 96.
10

VIIL CREDIT RELEASE SCHEDULE
A. Upon submittal of all appropriate documentation by the Sponsor, and subsequent approval
by DWR, it is agreed that the Nutrient Offset Credits associated with the Bank Parcel will
become available for sale to a third party in accordance with Credit Release Schedule in
Table 3.0 below.
Table 3.0 - Credit Release Schedule for Nutrient Offset Credits
% Credit
Available for
Task
Project Milestone
Sale
Instrument and BPDP Approved by DWR, Full Delivery DMS Mitigation
Plan approved by DWR, Conservation Easement Recorded*, Financial
1
Assurance Posted
20
All Riparian Site Earthwork, Planting and Installation of Monitoring
Devices Completed for both the Pickle Creek Full Delivery site (DMS ID#
100184) and the Bank Parcel, easement boundaries adequately marked, &
all applicable permits obtained. A site visit performed by DWR is required
2
1 for this task.
20
3
Monitoring Financial Assurance Posted and Approval of As -Built Report
10
Monitoring Report #1: Approved by the DWR** & Financial Assurance
4
renewed
10
Monitoring Report #2: Approved by the DWR* * & Financial Assurance
5
renewed
10
Monitoring Report #3: Approved by the DWR* * & Financial Assurance
6
renewed
10
Item B (1) of Section X in this Instrument has been completed and
7
approved by DWR.
5
No remaining credits will be released until the conservation easement has
been assigned to an approved land trust or stewardship
Monitoring Report #4: Approved by the DWR* * & Financial Assurance
8
renewed
5
Monitoring Report #5: Approved by the DWR* * and final site visit by
9
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
B. DWR may modify credit release schedules 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 nutrient offset credits that will be generated by
the Bank Parcel.
11

IX. PROCEDURE FOR DEBITING AND CREDITING CREDITS
Credit Ledters
A. The Bank Sponsor shall maintain a credit ledger for each mitigation type for each Bank
Parcel under this Instrument: 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'/z in. x 11 in. spreadsheet with legible
font style and font size. All ledgers shall be submitted using the templates provided in
Attachments B of this Instrument or any updated versions to these templates as provided
by DWR.
Credit Processing
C. Credits must be calculated for the 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.
D. Nutrient Offset Credits generated on the Bank Parcel will be used to offset nitrogen nutrient
loads within the 03020201 HUC of the Neuse River Basin, excluding Falls Lake
Watershed, in accordance with 15A NCAC 02B .0703 and are neither convertible nor
transferrable to Riparian Buffer Credits.
E. The Bank Sponsor shall obtain written verification of nutrient offset need from a designated
local government in the 03020201 HUC of the Neuse River Basin outside of the Falls
Watershed, or from DWR through an approved NPDES permit for wastewater nutrient
sources prior to debiting Nutrient Offset Credits from the Bank Parcel.
F. All credit and debit transactions for the Bank Parcel under this Instrument shall be
accurately depicted in the credit ledgers. The Bank 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
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
G. All credit sales will include a Mitigation Credit Transfer Certificate ("Certificate") that is
required to be provided to the buyer of Nutrient Offset credits, that will include, at a
minimum, the following information:
12

1. Bank Details: (1) sponsor, (2) bank parcel name 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 Nutrient Offset Credits purchased in pounds and
confirmation from the designated local government 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, (5 — when applicable) designated local
government requiring Nutrient Offset Credits for this project and (6) credit type
and amount required for project.
H. If the DWR determines that the Bank is operating at a deficit (e.g. the Sponsor is closing
on sales and/or transferring credit that is not available), or the Bank is selling credits out of
compliance with statutes, rules or this Agreement, the sale/transfer of credits 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 the Bank Parcel under this Instrument shall be identified as the
event when the Sponsor is relieved of all of 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 following events have occurred:
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, 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.
13

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 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 of 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
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,
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.
L 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.
14

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 email with a
delivered receipt request 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: Environmental Banc and Exchange, LLC
Attention: Mr. Bradley Breslow
3600 Glenwood Avenue, Suite 100
Raleigh, North Carolina 27612
[e-mail]
If to DWR: NC Division of Water Resources — 401 & Buffer Permitting Branch
Attn: Nutrient Offset and Buffer Banking Coordinator
1617 Mail Service Center
Raleigh, NC 27699-1617
15

L. Applicable Law: This Agreement shall be construed under the laws of the State of North
Carolina.
Environmental Banc and Exchange, LLC
By: Brad Breslow (Print)
(Signature)
Title:
Date:
NORTH CAROLINA DEPARTMENT OF ENVIRONMENTAL QUALITY -
DIVISION OF WATER RESOURCES
By: (Print)
(Signature)
Director, Division of Water
Title: Resources
Date:
16

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