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Mitigation Bank
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DRAFT MITIGATION BANKING INSTRUMENT & PHASE I
BANK SITE MITIGATION PLANS
March 2016
Prepared for:
Prepared by:
4A0, I
RiverBank
Axiom Environmental, Inc.
AGREEMENT TO ESTABLISH THE CAPE FEAR 02 UMBRELLA MITIGATION
BANK WITHIN THE STATE OF NORTH CAROLINA
U.S. Army Corps of Engineers (Corps) approval of this Instrument constitutes the regulatory
approval required for the CAPE FEAR 02 UMBRELLA MITIGATION BANK to be used to
provide compensatory mitigation for Department of the Army permits pursuant to 33 CFR
332.8(a)(1). This Instrument is not a contract between the Sponsor or Property Owner and Corps
or any other agency of the federal government. Any dispute arising under this Instrument will not
give rise to any claim by the Sponsor or Property Owner for monetary damages. This provision
is controlling notwithstanding any other provision or statement in the Instrument to the contrary.
This Umbrella Mitigation Banking Instrument (LIMBI) is made and entered into on the
day of , 2016, by Restoration Systems, LLC (Sponsor) and the Corps, and each of the
following agencies, upon its execution of this LIMBI, the Environmental Protection Agency
(EPA), the U.S. Fish and Wildlife Service (FWS), the National Marine Fisheries Service
(NMFS), the North Carolina Wildlife Resources Commission (NCWRC), the State Historic
Preservation Office (SHPO) and the North Carolina Division of Water Resources (NCDWR).
The Corps, together with the State and Federal agencies that execute this UMBI, are hereinafter
collectively referred to as the Interagency Review Team (IRT).
WHEREAS the purpose of this agreement is to establish an umbrella mitigation bank (Bank)
providing compensatory mitigation for unavoidable wetland and/or stream impacts separately
authorized by Section 404 Clean Water Act permits and /or Section 10 of the Rivers and Harbors
Act permits in appropriate circumstances;
WHEREAS the agencies comprising the IRT agree that the sites thus far incorporated into
this UMBI (Bank Sites) are suitable mitigation sites, and that implementation of the Mitigation
Plans are likely to result in net gains in wetland and/or stream functions at the Bank Sites, and
have therefore approved the Mitigation Plans;
THEREFORE, it is mutually agreed among the parties to this agreement that the following
provisions are adopted and will be implemented upon signature of this LIMBI.
Section I: General Provisions
A. The Sponsor is responsible for assuring the success of the restoration, enhancement and
preservation activities at the Bank Sites, and for the overall operation and management of the
Bank. The Sponsor assumes the legal responsibility for providing the compensatory mitigation
once a permittee secures credits from the Sponsor and the District Engineer (DE) receives
documentation that confirms the Sponsor has accepted responsibility for providing the required
compensatory mitigation.
B. The goal of the Umbrella Bank is to restore, enhance and preserve perennial and
intermittent stream systems, and associated riparian wetland systems, and their functions to
compensate in appropriate circumstances for unavoidable wetland and/or stream impacts
authorized by Section 404 of the Clean Water Act permits and/or Section 10 of the Rivers and
Harbors Act permits in circumstances deemed appropriate by the Corps after consultation,
through the permit review process, with members of the IRT.
C. Use of credits from the Bank to offset wetland and/or stream impacts authorized by Clean
Water Act permits must be in compliance with the Clean Water Act and implementing
regulations, including but not limited to the 404(b)(1) Guidelines, the National Environmental
Policy Act, and all other applicable Federal and State legislation, rules and regulations. This
agreement has been drafted in accordance with the regulations for Compensatory Mitigation for
Losses of Aquatic Resources effective June 9, 2008 (33 CFR Parts 325 and 332) (Mitigation
Rule).
D. The IRT shall be chaired by the DE of the Corps, Wilmington District (District). The
IRT shall review documentation for the establishment of Bank Sites. The IRT will also advise
the DE in assessing monitoring reports, recommending remedial measures, approving credit
releases, and approving modifications to this instrument. The IRT's role and responsibilities are
more fully set forth in Sections 332.8 of the Mitigation Rule. The IRT will work to reach
consensus on its actions.
E. The DE, after consultation with the appropriate Federal and State review agencies
through the permit review process, shall make final decisions concerning the amount and type of
compensatory mitigation to be required for unavoidable, permitted wetland and/or stream
impacts, and whether or not the use of credits from the Bank is appropriate to offset those
impacts. In the case of permit applications and compensatory mitigation required solely under
the Section 401 Water Quality Certification rules of North Carolina, the NCDWR will determine
the amount of credits that can be withdrawn from the Bank. Any credits used to offset impacts
solely authorized by Section 401 cannot be used for other impacts authorized under Section 404
of the Clean Water Act or Section 10 of the Rivers and Harbors Act.
F. The parties to this agreement understand that a watershed approach to establish
compensatory mitigation must be used to the extent appropriate and practicable. Where
practicable, in-kind compensatory mitigation is preferred.
Section II: Geographic Service Area
The Geographic Service Area (GSA) is the designated area within which the Bank is authorized
to provide compensatory mitigation required by DA permits. The GSA for this Bank shall be
comprised of all areas contained within the Haw River basin, Cape Fear 02 or Hydrologic Unit
Code (HUC) 03030002 in North Carolina (Appendix A). Credits must be used in the same 8 -
digit HUC in which they were generated. Use of a Bank Site to compensate for impacts beyond
the GSA may be considered by the Corps or the permitting agency on a case-by-case basis.
Section III: Mitigation Plans
Any Mitigation Plan submitted pursuant to this UMBI must contain the information listed
in 332.4(c)(2) through (14) of the Compensatory Mitigation Rule.
A. The Sponsor will perform work described in all approved Mitigation Plans.
B. The Sponsor shall monitor Bank Sites as described in the approved Mitigation Plan(s),
until such time as the IRT determines that the performance standards described in the Mitigation
Plan(s) have been met.
C. Mitigation Plans submitted for inclusion in this bank (Appendix B) must meet the
requirements of any District guidance that is current at the time the proposed Bank Site is
submitted to the District and determined complete, including any updates made to monitoring
requirements, credit releases, long term management, or any other provisions that are required
and/or specifically addressed in the Mitigation Plan. The addition of any site to this instrument
shall be considered as a modification to this instrument, and processed in accordance with the
procedures set forth in the Mitigation Rule.
D. Authorized representatives of the IRT agencies will be allowed reasonable access to Bank
Site properties for the purposes of inspection and monitoring compliance for all Mitigation Plans
associated with this instrument.
Section IV: Reporting
A. The Sponsor shall submit to the DE, for distribution to each member of the IRT, an
annual report describing the current condition of the Bank Sites and the condition of the Bank
Sites in relation to the performance standards in the Mitigation Plan(s). The Sponsor shall
provide to the DE any monitoring reports described in the Mitigation Plan(s).
B. As part of each annual monitoring report, the Sponsor shall also provide ledger reports
documenting credit transactions as described in Section VIIII of this UMBI.
C. Each time an approved credit transaction occurs, the Sponsor shall provide notification to
the DE within 30 days of the transaction. This notification shall consist of a summary of the
transaction and a full ledger report reflecting the changes from the transaction. Additionally,
signed copies of the Compensatory Mitigation Transfer of Responsibility Form shall be
submitted to the Corps Project Manager for the permit and the Corps Bank Manager for the Bank
Site.
Section V: Remedial Action
A. The DE shall review the monitoring reports, as required in the Mitigation Plan(s), and
may, at any time, after consultation with the Sponsor and the IRT, direct the Sponsor to take
remedial action at the Bank Site(s). Remedial action(s) required by the DE shall be designed to
achieve the performance standards as specified in the Mitigation Plan(s). All remedial actions
required under this section shall include a work schedule and monitoring criteria that will take
into account physical and climactic conditions.
B. The Sponsor shall implement any remedial measures required pursuant to the above.
C. In the event the Sponsor determines that remedial action may be necessary to achieve the
required performance standards, it shall provide notice of such proposed remedial action to all
members of the IRT. No remedial actions shall be taken without the concurrence of the DE, in
consultation with the IRT.
Section VI: Use of Mitigation Credits
A. Description of credit classifications and provisions pertaining to the use of those credits
shall be provided in the Mitigation Plan(s) to be included in this Bank. Credit classifications
(e.g., cold water stream, cool water stream, warm water stream, coastal wetlands, non -riparian
wetlands, riparian non-riverine wetlands, and riparian riverine wetlands) will be in accordance
with current District guidance at the time the Mitigation Plan is submitted to the District. In
general, these classifications will be used to determine if a particular credit qualifies as "In -
Kind" mitigation. Exceptions to the use of "In -Kind" mitigation may be allowed at the
discretion of the permitting agencies on a case-by-case basis.
B. Wetland and stream compensation ratios are determined by the DE on a case-by-case
basis based on considerations of functions of the wetlands and/or streams impacted, the severity
of the wetland and/or stream impacts, the relative age of the Bank Site, whether the
compensatory mitigation is in-kind, and the physical proximity of the wetland and/or stream
impacts to the Bank Site.
C. Notwithstanding the above, all decisions concerning the appropriateness of using credits
from the Bank Sites to offset impacts to waters and wetlands, as well as all decisions concerning
the amount and type of such credits to be used to offset wetland and stream impacts authorized
by Department of the Army permits, shall be made by the DE, pursuant to Section 404 of the
Clean Water Act and implementing regulations and guidance. These decisions may include
notice to and consultation with the members of the IRT through the permit review process if the
DE determines this to be appropriate given the scope and nature of the impact.
Section VII: Credit Release Schedule
A. All credit releases must be approved in writing by the DE, following consultation with
the IRT, based on a determination that required performance standards have been achieved.
B. A credit release schedule shall be provided in the site-specific Mitigation Plan(s) that are
included in the Bank. The credit release schedule will list all of the proposed credit releases and
any performance standards associated with those releases.
C. In general, the initial allocation of credits from any site included as part of this bank shall
be available for sale only after the completion of all of the following:
1. Execution of this UMBI by the Sponsor, the DE, and other agencies eligible for
membership in the IRT who choose to execute this LIMBI, to include the approval of any
modifications to this agreement when new sites are added to it;
2. Approval of a final Mitigation Plan(s);
3. Confirmation that the Bank Site(s) have been secured;
4. Delivery of executed financial assurances as specified in the site-specific Mitigation
Plan(s);
5. Delivery of a copy of the recorded long-term protection mechanism as described in the
site-specific Mitigation Plan(s), as well as a title opinion covering the property acceptable
to the DE; and
6. Issuance of any DA permits necessary for construction of the Bank Site(s).
The Sponsor must initiate construction of the physical and biological improvements proposed in
the approved Mitigation Plans no later than the end of the first full growing season following the
initial sale of credits from each Bank Site. This provision does not apply to preservation -only
sites that do not include any physical or biological improvements. Subject to the Sponsor's
continued satisfactory completion of all required performance standards and monitoring,
additional restoration mitigation credits will be available for sale by the Sponsor as specified in
the final Bank Site Mitigation Plan(s).
Section VIII: Accounting Procedures
A. The Sponsor shall develop accounting procedures acceptable to the DE for maintaining
accurate records of debits made from the Bank Sites. Such procedures shall include the
generation of a ledger for each Bank Site, by the Sponsor, detailing credits used at the time they
are debited from the Bank. All ledger reports shall identify credits debited and remaining by
type of credit and shall include for each reported debit the Corps ORM ID number for the DA
permit for which the credits were utilized and the permitted impacts for each resource type.
B. Each time an approved credit transaction occurs, the Sponsor shall notify the DE within
30 days of the transaction with a summary of the transaction and a full ledger report showing the
changes made. Signed copies of the Transfer of Mitigation Responsibility form shall also be
submitted to the Corps permit Project Manager and the Corps Bank Manager for the Bank Site.
C. The Sponsor shall prepare an annual ledger report, on each anniversary of the date of
execution of this agreement, showing all credits used, any changes in credit availability (e.g.,
additional credits released, credit sales, suspended credits, etc.), and the beginning and ending
balance of remaining credits. The Sponsor shall submit the annual report to the DE, for
distribution to each member of the IRT, until such time as all of the credits have been utilized, or
this agreement is otherwise terminated.
Section IX: Financial Assurances
A. Financial assurances for the Bank Sites will be detailed in the site-specific Mitigation
Plan(s). The Sponsor shall provide financial assurances in a form acceptable to the DE,
sufficient to assure completion of all mitigation work, required reporting and monitoring, and
any remedial work required pursuant to this LIMBI. The financial assurance value should be
based on the cost of doing the mitigation work, including costs for land acquisition (if
applicable), planning and engineering, legal fees, mobilization, construction, and monitoring.
For preservation only Bank Sites, no financial assurances will generally be required unless there
are specific activities necessary to ensure the successful preservation of resources on the site, in
which case appropriate financial assurances may still be required.
B. All financial assurances shall be made payable to a standby trust or to a third -parry
designee, acceptable to the Corps, who agrees to complete the project or provide alternative
mitigation. Financial assurances structured to provide funds to the Corps in the event of default
by the Bank Sponsor are not acceptable.
C. The form and amount of financial assurances must be stated in the Mitigation Plan for
each Bank Site in order for the Mitigation Plan to be approved. This must include the name of
the specific provider of those assurances and the method by which the financial assurances will
be provided in the event that they must be utilized. Original copies of the financial assurance
documents must be provided to the DE prior to the initial release of credits.
D. A financial assurance must be in the form that ensures that the DE receives notification at
least 120 days in advance of any termination or revocation.
Section X: Site Protection
A. The Sponsor shall grant a Conservation Easement (CE) in a form acceptable to the DE,
sufficient to protect the Bank Site(s) in perpetuity. The CE shall be perpetual, preserve all
natural areas, and prohibit all uses of the property inconsistent with its use as mitigation
property, including any activity that would materially alter the biological integrity or functional
and educational value of wetlands or streams within the Bank Site(s), consistent with the
Mitigation Plan(s). The purpose of the CE will be to assure that future use of the Bank Site(s)
will result in the restoration, protection, maintenance and enhancement of wetland and/or stream
functions described in the Mitigation Plan(s). The name and contact information for the Corps
approved easement holder and a copy of the CE template will be provided in the Bank Site
Mitigation Plans(s).
B. The Sponsor shall deliver a title opinion acceptable to the DE covering the Bank Site
property. The property shall be free and clear of any encumbrances that would conflict with its
use as mitigation, including, but not limited to, any liens that have priority over the recorded CE.
C. Subsequent to the recording of the CE, the Sponsor may convey the Bank Site property
either in fee or by granting an easement to a qualified land trust, state agency, or other
appropriate nonprofit organization approved by the Corps. The Sponsor is responsible for
ensuring that the CE is re-recorded so that it remains within the chain of title. The terms and
conditions of this conveyance shall not conflict with the intent and provisions of the CE nor shall
such conveyance enlarge or modify the uses specified in the easement. The CE must contain a
provision requiring 60 day advance notification to the DE before any action is taken to void or
modify the CE, including transfer of title to, or establishment of any other legal claims over, the
Bank Site.
Section XI: Long-term Management
A. The Sponsor shall implement the long-term management plan as described in each site-
specific Mitigation Plan. The name and contact information for the party responsible for long-
term management will be included in all Bank Site Mitigation Plans.
B. The long-term management plan will include a list of annual maintenance, monitoring,
and/or repair activities for the Bank Site(s), the associated annual cost for each activity, and the
required total amount necessary to provide all future site management. The long-term
management plan should explain how the funds will be managed and provided to the designated
long-term manager (e.g., an endowment managed through a separate account holder). The long-
term management plan should include a contingency section that addresses how the
responsibility and funding for the long-term site management will be passed on to a new
manager in the event that the selected long-term management entity is no longer able to provide
for management of the site.
Section XII: Default and Closure
A. The Sponsor shall establish and/or maintain Bank Sites until (i) credits have been
exhausted or banking activity is voluntarily terminated with written notice by the Sponsor
provided to the DE and other members of the IRT; and (ii) it has been determined and agreed
upon by the DE and IRT that the debited Bank Site has satisfied all the conditions herein and in
the associated Bank Site Mitigation Plan. If the DE determines that the Bank Site is not meeting
performance standards or complying with the terms of this UMBI, appropriate action will be
taken. Such actions may include, but are not limited to, suspending credit sales, adaptive
management, decreasing available credits, utilizing financial assurances, and terminating the
instrument.
B. Any delay or failure of Sponsor shall not constitute a default hereunder if and to the
extent that such delay or failure is primarily caused by any act, event or conditions beyond the
Sponsor's reasonable control and significantly adversely affects its ability to perform its
obligations hereunder including: (i) acts of God, lightning, earthquake, fire, landslide, or
interference by third parties; (ii) condemnation or other taking by any governmental body; (iii)
change in applicable law, regulation, rule, ordinance or permit condition, or the interpretation or
enforcement thereof, (iv) any order, judgment, action or determination of any federal, state or
local court, administrative agency or government body; or (v) the suspension or interruption of
any permit, license, consent, authorization or approval. If the performance of the Sponsor is
affected by any such event, Sponsor shall give written notice thereof to the IRT as soon as is
reasonably practicable. If such event occurs before the final availability of all credits for sale, the
Sponsor shall take remedial action to restore the property to its condition prior to such event, in a
manner sufficient to provide adequate mitigation to cover credits that were sold prior to such
delay or failure to compensate for impacts to waters, including wetlands, authorized by
Department of the Army permits. Such remedial action shall be taken by the Sponsor only to the
extent necessary and appropriate, as determined by the IRT.
C. At the end of the Bank Site monitoring period, upon satisfaction of the performance
standards, the Sponsor may submit a request to the DE for Bank Site close out. The DE, in
consultation with the IRT, shall use best efforts to review and comment on the request within 60
days of such submittal. If the DE determines the Sponsor has achieved the performance
standards in accordance with the Bank Site Mitigation Plan and all obligations under this LIMBI,
the DE shall issue a close out letter to the Sponsor.
Section XIIL• Miscellaneous
A. Any agency participant may terminate its participation in this agreement with notice in
writing to all other parties to this agreement. Termination shall be effective seven (7) days from
placing written notices in the United States mail. Member withdrawal shall not affect any prior
sale of credits and all remaining parties shall continue to implement and enforce the terms of this
LIMBI.
B. Modification of this UMBI shall be in accordance with the procedures set forth in 332.8 of
the mitigation rule.
C. No third party shall be deemed a beneficiary hereof and no one except the signatories hereof,
their successors and assigns, shall be entitled to seek enforcement hereof.
D. This UMBI constitutes the entire agreement between the parties concerning the subject
matter hereof and supersedes all prior agreements or undertakings.
E. In the event any one or more of the provisions contained in this UMBI are held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or unenforceablility will not
affect any other provisions hereof, and this UMBI shall be construed as if such invalid, illegal or
unenforceable provision had not been contained herein.
F. This UMBI shall be governed by and construed in accordance with the laws of North
Carolina and the United States as appropriate.
G. This UMBI may be executed by the parties in any combination, in one or more counterparts,
all of which together shall constitute but one and the same instrument.
H. The terms and conditions of this UMBI shall be binding upon, and inure to the benefit of the
parties hereto and their respective successors.
L All notices and required reports shall be sent by regular mail to each of the parties at their
respective addresses, provided below.
Sponsor:
Mr. John Preyer
Restoration Systems, LLC
President
1101 Haynes Street, Suite 211
Raleigh, NC 27604
Corps:
Mr. David Bailey
U.S. Army Corps of Engineers
Regulatory Division
3331 Heritage Trade Drive, Suite 105
Wake Forest, NC 27587
USEPA:
Mr. Todd Bowers
Wetlands Section - Region IV
Water Management Division
U.S. Environmental Protection Agency
61 Forsyth Street, SW
Atlanta, Georgia 30303
USFWS:
Ms. Kathryn Matthews
U.S. Fish and Wildlife Service
Fish and Wildlife Enhancement
Post Office Box 33726
Raleigh, North Carolina 27636-3726
NCWRC:
Ms. Shari Bryant
North Carolina Wildlife Resources Commission
P.O. Box 129
Sedalia, NC 27342-0129
NCDWR:
TBD
Division of Water Resources
North Carolina Department of Environment and Natural Resources
Post Office Box 29535
Raleigh, NC 27626-0535
NCSHPO
State Historic Preservation Office
Renee Gledhill -Earley
4617 Mail Service Center
109 E. Jones Street
Raleigh, NC 27699-4617
NMFS:
Mr./Ms.
National Marine Fisheries, NOAA
Habitat Conservation Division
Pivers Island
Beaufort, North Carolina 28516
NCDCM:
Mr./Ms. *
North Carolina Division of Coastal Management
North Carolina Department of Environment and
Natural Resources
*Address
10
IN WITNESS WHEREOF, the parties hereto have executed this Agreement entitled
"Agreement To Establish The Cape Fear 02 Umbrella Mitigation Bank within the State of
North Carolina":
Sponsor:
Date:
U.S. Army Corps of Engineers:
By: Date:
11
IN WITNESS WHEREOF, the parties hereto have executed this Agreement entitled
"Agreement To Establish The Cape Fear 02 Umbrella Mitigation Bank, within the State of
North Carolina":
U.S. Environmental Protection Agency:
By:
Date:
U.S. Fish and Wildlife Service:
By:
Date:
N.C. Division of Water Resources:
By:
Date:
N.C. Wildlife Resources Commission:
By:
Date:
NC State Historic Preservation Office:
By: Date:
National Marine Fisheries Service:
By: Date:
N.C. Division of Coastal Management:
By: Date:
12
List of Appendices
Appendix A: Geographic Service Area Map
Appendix B: Bank Site Mitigation Plans
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