20200579 Ver 1_Mitigation Evaluation_20220617

ROY COOPER
Governor
ELIZABETH S. BISER
Secretary
RICHAM E. ROGERS, JR. NORTH CAROLINA
Director Environmental Quality
June 17, 2022
TO: Richard E. Rogers, Jr
Director, Division of Water Resources (DWR)
1,-lq-70
FROM: Katie Merritt
Nutrient Offset Buffer Banking Coordinator, DWR
THROUGH: Paul Wojoski
Supervisor - 401 & Buffer Permitting Branch, DWR
SUBJECT: Recommended Approval of the Whirligig Station Nutrient Offset Banking
Instrument in the Neuse River Basin for Nutrient Offset Credits pursuant to the
Neuse River Basin Nutrient Management Strategy for the City of Wilson
Stormwater Division.
Attached is the final Nutrient Offset Banking Instrument (NOBI) between the City of Wilson
Stormwater Division and the Division of Water Resources. This NOBI was placed on public
notice and made available for public comments on April 4, 2022. The public comment period
ended on April 19, 2022. Comments on the draft NOBI were received from three entities: 1)
North Carolina Environmental Restoration Association (NCERA), 2) Green Environmental
Services, LLC and 3) Restoration Systems, LLC and are attached to this memo.
DEQ Legal counsel, staff from DWR's 401 & Buffer Permitting Branch, and staff from DWR's
Non -Point Source Planning Branch worked together to finalize this NOBI. After the comment
period closed, DWR staff and legal counsel reviewed the public comments and have prepared the
following responses for your consideration. No changes were made to the NOBI from the public
comments.
Primary concerns noted in the public comments briefly summarized below and the Division's
response are provided:
1. Some comments stated that Nutrient Offset is a type of compensatory mitigation and thus there
are rules and statutes that prohibit local governments from establishing a nutrient offset bank.
DWR's Response: Nutrient Offset is not a type of compensatory mitigation and the limitations
in 143-214.11 referenced do not apply.
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2. Comments stated that the City of Wilson Stormwater Division should not be allowed to establish
a nutrient offset bank.
DWR's Response: This local government (Bank Sponsor) has met all the requirements and
expectations of 15A NCAC 02B .0703 and applicable statutes and thus, can establish a nutrient
offset bank.
3. Comments stated that buyers using private banks should be prioritized over buyers using public
banks.
DWR Response: GS 143-214.26 sets out the requirements for purchasing offset credits and the
statute does not prohibit a local government from establishing a nutrient offset bank or
prioritize buying credits from "private" banks over `public" banks.
4. Comments communicated concern over limited number of DWR staff to process applications for
nutrient offset banking and how local government bank applications would further delay the
review of private bank applications to DWR.
DWR Response: Additional work load is not an appropriate basis for rejecting an
application that complies with the applicable laws and requirements.
5. Comments stated concern that this NOBI creates an unfair advantage over private banks.
DWR Response: The statutes and regulations do not prohibit local governments from
establishing nutrient offset banks.
6. Commenters expressed concern that the legislative intent of North Carolina General Statute
(NCGS) 148-128 titled "Authorization for Correction Enterprises" was not being considered.
DWR Response: NCGS 148-128 pertains to the prison system and is irrelevant to nutrient
offset credits.
7. Concerns with CAPER/ Risk Management disruption.
DWR Response: There is always a potential for a new competitor to enter the "market,"
regardless of whether the new competitor is public or private. More importantly, risk
management and competition are not regulatory criteria addressed by either the statute or 15A
NCAC 02B .0703.
Please review the attached NOBI. If you approve, please sign on page 15 of the NOBI and page
6 of the Operation & Maintenance Agreement (Attachment A) and return the document to Katie
Merritt for final execution. A notary will need to verify your signature on page 6 of the
Attachment A document.
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