20141149 Ver 1_Initial Evaluation Mitigation Sites_20161220

Regulatory Division
DEPARTMENT OF THE ARMY
WILMINGTON DISTRICT, CORPS OF ENGINEERS
69 DARLINGTON AVENUE
WILMINGTON, NORTH CAROLINA 28403-1343
December 20, 2016
Re: Initial Evaluation of the RES Cape Fear Umbrella Mitigation Bank: Dairyland Mitigation
Site (SAW -2016-01258) and Cloud and Banner Mitigation Site (SAW -2016-02451)
Environmental Banc & Exchange, LLC
Attention: Mr. Daniel Ingram
302 Jefferson Street, Suite 110
Raleigh, North Carolina 27605
Dear Mr. Ingram:
This letter is in regard to your prospectus document for the proposed RES Cape Fear
Umbrella Mitigation Bank, dated July 18, 2016. The proposal consists of the establishment and
operation of a commercial umbrella mitigation bank (UMB) with two initial mitigation sites. The
Dairyland mitigation site is a 30.96 -acre easement within two parcels located northeast of the
intersection of Orange Grove Road and Dairyland Road, southwest of Hillsborough, in Orange
County, North Carolina. (35.979167°N, -79.1875°W) The Cloud and Banner mitigation site is a
56.45 -acre easement within a single parcel located northeast of the intersection of NC Highway
119 and Mrs. White Lane, north of Mebane, in Alamance County, North Carolina. (36.143838°N,
-79.272774°W)
The Corps determined the prospectus was complete and issued a public notice (P/N #
SAW -2016-01258) on August 5, 2016. The purpose of this notice was to solicit the views of
parties either interested in or affected by the proposed work. Attached are Corps and NCDWR
comments and a copy of correspondence received in response to the public notice from the N.C.
Department of Natural and Cultural Resources.
The Corps has considered all comments received in response to the public notice and
information that was discussed during a site inspection with the Corps and DWR on May 2,
2016. We have made a preliminary determination that the proposed mitigation bank may have
the potential to restore, enhance, and preserve aquatic resources within the Cape Fear 02 River
basin (Haw River basin). However, in order to make a final determination, we request that you
respond to the concerns in the attached memo and provide a hard copy of the prospectus
document to all members of the IRT so they may review and provide comment.

We appreciate your interest in restoring and protecting waters of the United States. If
you have any questions about the path forward for the proposed mitigation bank, please do not
hesitate to contact me at [phone], extension 59.
Sincerely,
Ditally U.by A18339165HUGHESANDREARADE DNC=US, o=U.5. Government ouED Dou=PKI
1258339165 ou=USA, cn=HUGHES.ANDPEA.WADE.1258339165
Date: 2016.12.2011:02:19 -05'00'
Andrea Hughes
Mitigation Project Manager
Enclosures
Electronic Copies Furnished:
NCIRT Distribution List
Mr. Daniel Ingram, EBX, LLC

REPLY TO
ATTENTION OF:
DEPARTMENT OF THE ARMY
WILMINGTON DISTRICT, CORPS OF ENGINEERS
69 DARLINGTON AVENUE
WILMINGTON, NORTH CAROLINA 28403-1343
CESAW-RG/Hughes December 20, 2016
MEMORANDUM FOR RECORD
SUBJECT: RES Cape Fear 02 Umbrella Mitigation Bank: Dairyland and Cloud and Banner
Mitigation Sites; USACE and NCDWR Prospectus Comments
Corps comments:
1. The prospectus document did not provide a service area map.. Please provide a service
area map for the Cape Fear 02 River basin (HUC 03030002).
2. Page 10, Section 4.1: The SMUs will be derived from stream restoration, enhancement
and preservation.
3. Page 13, Section 4.3.3: Channel stability should be demonstrated through a minimum of
four bankfull events documented in the seven-year monitoring period.
4. Page 13, Section 4.3.5: Wetland hydrology performance standards must include specific
hydrology standards (percent of growing season).
5. Page 14, Section 5.2: Channel lengths must be based on stream centerline.
6. Page 15, Table 8: The 10% associated with meeting bankfull requirements cannot be
released prior to completion of year 4 monitoring. Also, the initial credit release
requirements are stated below Table 9 in Section 5.2.1 on page 16.
7. Page 16, Section 5.2.1: The Corps approves all credit releases, in consultation with the
IRT. Also, the initial allocation of credits will be based on approval of the MBI and
associated mitigation plans.
8. Page 17, Section 5.3: A draft copy of financial assurance documents should be provided
in the draft mitigation plan. The executed financial assurance documents must be
provided to the Corps. Also, this section states financial assurances shall be payable at the
direction of the USACE to his designee or to a standby trust. The mitigation plan should
name a third party that will receive the financial assurance funds in the event of default
by the sponsor.
9. Page 17, Section 5.4: This document is a prospectus. Also, this section is unclear
regarding transfer of the conservation easement to the long term manager. The easement
must be transferred prior to the initial credit release.

10. Dairyland:
a. For reach WF -2, it must be demonstrated that the channel can be reconnected to the
floodplain in order to justify a restoration approach, otherwise the reach should be
enhancement at a reduced ratio (5:1).
b. The western drainage, from UT -1 down to HB -3 has been historically impacted by
beaver, and several dams are still present within the system. We have concerns about
the stated uplift in these reaches, particularly given the recent removal of several
dams on this reach upstream of the road crossing. This system is still in transition
following the removal of the dams so it is difficult to determine the appropriate
approach.
c. UT -1 appears to be a wetland drainage rather than a stream system, so stream
enhancement along this reach is not appropriate.
11. Cloud and Banner:
a. The large wetland area draining to UT -4 is primarily preservation, not enhancement.
Some enhancement may be appropriate in the immediate vicinity of the primary ditch
along the northeastern side, but that is the extent. The wetland is generally of good
quality but due to the age of the vegetation and level of threat, we believe that a ratio
of 5:1 for preservation is too high. Also, it is unclear if the stream (UT -4) should start
within this wetland, as this feature appears to be a ditch dug to drain the wetland
rather than a natural stream channel.
b. UTs 2 and 3 are in reasonable condition and there is little justification for credit due
to functional uplift on these reaches.
Further evaluation of the main stem of Back Creek is necessary to assess the
appropriate approach and credit ratio.
NCDWR comments:
Section 1.1.1: Dairyland: The second paragraph mentions that this project will also offer
nutrient offset through NCDMS. During the site visit you mentioned that the buffer
portion of this site may be used for some of the Duke/Coal Ash settlement case. If any
part of this or any project is targeted for the Duke Settlement case, specific language
should be included that governs its credit management, especially crediting, oversight,
and long term management.
2. The proposed mitigation summary in Table 6 agrees with what we saw in the field. Our
only concern would be UT -1 which is proposed as EIII at 5:1. NCDWR would not accept

the increase in SMUs for "non-standard" methods until we investigate the method and
determine repeatability. Also, recently removed beaver dams seen during the site visit
were a concern.
3. Cloud and Banner Site: Table 7: changes needed include:
a. Back Creek: if planting is all that is proposed (EII), NCDWR is not sure 2.5:1 is
appropriate. The IRT should look at EII a little closer.
b. UT -1: This channel should be removed, my field notes indicate no evidence of a
stream channel.
UT -2: This may not be appropriate as EII for the entire reach. There are areas more
suited to preservation.
d. UT -6: Request additional information on the proposed EI section in order to
determine appropriate credit ratios.
e. Wetlands: The only potential wetland enhancement on this project is north (and to the
east) of Back Creek. The wetlands located south of Back Creek are basically
preservation quality. Also, I don't recall the wetland area located adjacent to UT 6 on
the western portion of the site.
HUGHES.ANDREA.Digitally signed by
HU GHE5.ANDREA.WADE.108339165
DN: -US, a—U.S. Government, ou=DOD, ou=PKI,
WADE.1258339165 DZUSI ate: 2016.12.20 110315 DORE0WADE.1258339165
Andrea Hughes
Mitigation Project Manager

rrt STAVdA
4
NFv��
North Carolina Department of Natural and Cultu
State Historic Preservation Office
Ramona M. Bartos, Administrator
Governor Pat McCrory
Secretary Susan Kluttz
August 12, 2016
John Thomas
Wilmington District, Corps of Engineers
3331 Heritage Trade Drive, Suite 105
Wake Forest, NC 27587
RECEIVED
1 ReAqurr&2016
RALEIGH R'EC1ILAiORY
Secretary Kevin Cherry
Re: RES Cape Fear Umbrella Mitigation Bank, SAW 2016-01258, Orange and Alamance Counties,
ER 16-1389
Dear Mr. Thomas:
We have received a public notice concerning the above project.
We have conducted a review of the project and are aware of no historic resources which would be affected
by the project. Therefore, we have no comment on the project as proposed.
The above comments are made pursuant to Section 106 of the National Historic Preservation Act and the
Advisory Council on Historic Preservation's Regulations for Compliance with Section 106 codified at 36
CFR Part 800.
Thank you for your cooperation and consideration. If you have questions concerning the above comment,
contact Renee Gledhill -Earley, environmental review coordinator, at 919-807-6579 or
ei-ivii-olei-nental.review L(v,ncdcr ggv. In all future communication concerning this project, please cite the
above referenced tracking number.
Sincerely,
6f"Ramona M. Bartos
Location: 109 East Jones Street, Raleigh NC 27601 Mailing Address: 4617 Mail Service Center, Raleigh NC 27699-4617 Telephone/fax: [phone]-6599