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20171122 Ver 2_Signed GUC MBI_20200217AGREEMENT TO ESTABLISH THE RESTORATION SYSTEMS'GUC MITIGATION BANKING INSTRUMENT IN THE TAR-PAMLICO RIVER BASIN FOR NUTRIENT OFFSET AND RIPARIAN BUFFER MITIGATION CREDITS PURSUANT TO THE TAR-PAMLIC0 NUTRIENT MANAGEMENT STRATEGY TABLE OF CONTENTS 1. PREAMBLE 2 It. LOCATION AND GEOGRAPHIC SERVICE AREA ...................................................................... 2 Ill. AUTHORITIES .................................................................................................................................. 3 IV. ESTABLISHMENT OF BANK PARCEL ......................................................................................... 3 V. BANK PARCEL DEVELOPMENT PACKAGE .............................................................................. 5 Vt. POST CONSTRUCTION DOCUMENTATION FOR THE BANK PARCEL ................................7 VII. CALCULATION OF CREDITS FOR THE BANK PARCEL ........................................................10 Vill. CREDIT RELEASE SCHEDULE .................................................................................................... I I IX. PROCEDURE FOR DEBITING AND CREDITING ..................................................................... 12 X. BANK PARCEL CLOSURE ............................................................................................................ 13 X1. GENERAL PROVISIONS FOR THE BANK PARCEL ................................................................. 14 ATTACHMENTS & REFERENCES A Division of Water Resources Authority Document B - NCDWR - Methodology & Calculations for Nutrient Reductions on the Bank Parcel C Ledger Templates t. Nutrient Offset Payment Rule: h tip:/lreports.oah. state.ne.us/ncac/title%2015a%20-%20environmental%20qual ity/chapter%2002%20- %20environmental%20management/subehapter%20b/ 15a%20ncac%2002b%20.0240. pdf 2. Riparian Buffer Mitigation Rule: http://rcports.oah.state.nc. us/ncac/title%2015aofo20-%20environmentaf%20qualitylehapter%2002%20- %20cnvironmental%20management/subchapter%20b/ 15a%20ncac%2002b%20.0295.pdf 2. NC Session Law 2019-86 "Nutrient Offset Credits": https://ncleg.gov/EnactedLegislation/Session Laws/UITM L/2019-2020/S L2019-86. htm I 3. Buffer Interpretation/Clarification 42008-019 for diffuse Flow: https:Hfilcs.nc.gov/nedeq/Water%20Qual ity/Surface%20 Water%20Protection/401 /Buffer%20CIarificati on%20Memos/Diffuse-Flow-for-Bu ffer-M itigation-Sites-Buffer-Clarification-Memo-20080819.pdf 1. PREANIBLE This Restoration Systems GUC Mitigation Banking Instrument ("Instrument") regarding the establishment, use, operation, and maintenance of the GUC Nutrient Offset and Buffer Mitigation Bank Parcel ("Bank Parcel"), further identified in Section 11, is to provide Tar - Pamlico Riparian Buffer mitigation credits ("Riparian Buffer Credits") and Tar -Pamlico Nutrient Strategy nutrient load reduction credits ("Nutrient Offset Credits"), is made and entered into by and among Restoration Systems, LLC (RS) 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 .0240 and 15A NCAC 02B .0295, see references. The purpose of the Bank Parcel is: A. To restore and preserve riparian vegetation adjacent to streams and agricultural ditches with the intent to improve water quality within the Tar -Pamlico River Basin. B. To convert agricultural land uses within riparian areas adjacent to streams and agricultural ditches into a dense, hardwood vegetated state with the intent to significantly reduce nutrient loadings associated with agricultural practices into streams and ditches. C. To provide mitigation and sell any resulting Riparian Buffer Credits and 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, and or permit obligations requiring such mitigation. 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 Riparian Buffer Credits and Nutrient Offset Credits for impacts requiring such mitigation or offset. B. The GSA for this instrument is limited to the Tar -Pamlico River Basin in the State of North Carolina, United States Geological Survey ("USGS") 8-digit Hydrologic Unit Code ("HUC") 03020103. C. Sale or transfer of Riparian Buffer Credits shall be limited to the 8-digit HUC 03020103 in the Tar -Pamlico River Basin, unless otherwise authorized by the DWR or delegated local government in accordance with 15A NCAC 02B .0295. D. Sale or transfer of Nutrient Offset Credits shall be limited to the 8-digit HUC 03020103 in the Tar -Pamlico River Basin, in accordance with 15A NCAC 02B .0240, unless otherwise authorized by the DWR in accordance with Session Law 2019-86. E. Table 1 provides site -specific details of the Bank Parcel proposed under this Instrument. Table 1.0 — Site -specific Details Bank 8-Digit USGS Named Parcel j County Hydrologic Unit DWR Project ' Receiving Primary Land Use/s Name Code ID # Location Stream GUC i Pitt 03020103 2017- Greenville Tar River Biosolid Application 1 122v2 & Agricultural Crops III. AUTHORITIES A. The Bank will be used to provide Riparian Buffer Credit and 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 Parcel approved under this Instrument, shall be consistent with approved North Carolina ("State") statutes and rules for the Tar -Pamlico Nutrient Management Strategy. D. Mitigation activities proposed under this Instrument and corresponding Bank Parcel Development Package (BPDP) to generate Riparian Buffer Credits and Nutrient Offset Credits shall be consistent with North Carolina ("State") statutes and rules for the Tar - Pamlico 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 .0240, DWR has provided a "Site Viability Letter" for the Bank Parcel proposed under this Instrument. The site viability letter is not an approval ofthe 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. "fable 2.0 below outlines when the Site Viability Letters were issued by NCDWR: Table 2.0 — Site Viability Letter Details Bank Parcel NC DWR Site Visit Viability Letter ! Viability letter I ' f - 3 Received j Expiration Date GUC November 14, 2017 May 29, 2019 I March 25.2021 GUC November 14, 2017 March 25, 2019 March 13, 2021 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 Bank Parcel for mitigation purposes or sale or transfer of any associated credits. The contents of the BPDP are provided in Section V. D. The Bank Parcel can be proposed as two separate phases with each phase described in detail in the BPDP. E. No mitigation activities approved in the BPDP, shall be performed in any areas that are directly or indirectly affected by the installation of above -ground and/or underground utilities, until, compliance of all applicable permits or authorizations associated with the utilities has been achieved. The Bank Sponsor shall receive verification of compliance from DWR prior to conducting activities related to generating Riparian Buffer Credits or Nutrient Offset Credits in areas. F. The BPDP submitted under this instrument will be placed on public notice and made available for public commenting for 15 calendar days. G. In general, the Bank Sponsor expects all Riparian Buffer Credits and Nutrient Offset Credits to be generated through either riparian restoration or riparian preservation. Riparian Buffer Credits are only attainable if the width of the riparian area is at least 20 feet from top of bank, H. The Bank Parcel is intended to provide Riparian Buffer Credit as follows: 1. Planting hardwood trees or trees and shrubs on a Restoration Site as defined in 15A NCAC 02B .0295 (b) adjacent to streams and primary ditches where agriculture has been determined to be the predominant land -use. 2. Diffused flow will be maintained onsite to the maximum extent practicable. The Buffer Interpretation/Clarification Memo #2008-019 may be applied where maintenance of diffuse flow onsite is unattainable. 3. Maintaining a Preservation Site as defined in 15A NCAC 02B .0295(b) by placing a perpetual conservation easement around riparian areas. Nutrient Offset Credit may be achieved on the Bank Parcel through restoration of the riparian areas where agriculture is the predominant land use. 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 stream and ditch banks. The width of the restoration area begins at the most landward limit of the top of bank or the rooted herbaceous vegetation and extends landward a minimum of 50 feet and a maximum of 200 feet on all sides of the surface waters. J. The Bank Parcel is expected to provide Nutrient Offset Credits in accordance with 15A NCAC 02B .0240 and is expected to provide Nutrient Offset Credit as follows: 1. Converting agricultural land uses within riparian areas to non-agricultural land uses. 2. Planting hardwood trees or trees and shrubs on a Restoration Site as defined in 15A NCAC 02B .0295 (b) adjacent to streams and primary ditches where agriculture has been determined to be the predominant land -use. F. The Bank Parcel submitted for review under this Instrument is anticipated to begin construction of proposed riparian activities after approval of this Instrument and corresponding BPDP. V. 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 will describe specifics related to any phasing of 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 buffer mitigation and nutrient offset activities including a detailed vegetation plan; 4) monitoring and maintenance plans; 5) financial assurances; 6) associated buffer/nutrient credit calculations, which shall include credit generation, service area, and accounting as appropriate for each regulatory authority; 7) stream determination letter from DWR;$) Site Viability Letter from DWR, 9) service area figure for each mitigation type; and 10) all pertinent information regarding permitting, bank stabilization, culvert removal, and installation of utilities indirectly or directly affecting 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. This Instrument does not qualify as, or substitute for, such documentation, permit, or authorization. C. Any restoration activities or proposed construction within the riparian buffers and other riparian areas on the Bank Parcel to produce Riparian Buffer Credit and/or 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. Pro pert} _Disposition & Lone Term ManAu..ement_for the. Bank Parcel E. Prior to the release of any credits, the Sponsor shall record permanent conservation easements at the Pitt 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 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 'Crust 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, I. 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 the Bank Parcel Following approval of the 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, including all phases according to the approved BPDP. If necessary, RS may elect to acquire a separate bond for each phase of the Bank Parcel as described in the 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 ofthe riparian mitigation activities and construction of the Bank Parcel as described in the approved BPDP. No bond shall be less than $150,000.00 to cover construction costs. L. Alternatively, in lieu of posting Performance Bonds, the Sponsor may elect to construct the Bank Parcel, in its entirety, including all phases prior to the first credit release. M. Once DWR has released all credits for completion of all the items listed below for each phase of the Bank Parcel, then the Bank Sponsor will be released from its performance obligations under the performance bondls required in Item J and K of this section: 1. Instrument and BPDP Approved by DWR, Conservation Easement Recorded, Financial Assurance Posted; 2. Site Earthwork, Planting and Installation of Monitoring Devices Completed; 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 THE 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 Riparian Buffers or other riparian areas until Item B (1) and (2) of Section X have been satisfied. B. When all riparian mitigation activities and construction have been completed for the Bank Parcel, in its entirety, including all phases, the Sponsor will submit an as -built plan and report for the Bank Parcel within 30 calendar days after completing the establishment of the riparian buffer and nutrient offset areas. If necessary, RS may elect to submit a separate As -Built Report for each phase ofthe Bank Parcel as described in the BPDP. The As -built Report will be submitted to DWR and describe any deviation from the approved BPDP and will document the following: I. Riparian restoration and planting details, invasive species control, confirmation of fence installation if applicable, cattle exclusions if applicable, monitoring device locations, vegetation plot locations, and photo point locations, as appropriate. 2_ Boundary Survey of the conservation easement area, signed and sealed by a licensed surveyor, including an inventory of the final riparian buffer mitigation and nutrient offset areas in both square feet and acres. 3. As -built map of the mitigated areas showing where riparian restoration and preservation were performed and any deviations to the Bank Parcel from what was approved in the BPDP. 4. Aerial map of the restoration and preservation areas approved in the BPDP. 5. Confirmation from DWR that all permits and authorizations directly or indirectly associated with the Bank Parcel, including those affiliated with the installation of above -ground and underground utilities, are all in compliance with applicable permit conditions. Financial Assurance for the Bank Parcel C. After completion of the riparian mitigation activities and construction on the Bank Parcel, in its entirety, including all phases, a separate Performance/Maintenance Bond/s 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. If necessary, RS may elect to acquire a separate bond for each phase of the Bank Parcel as described in the BPDP. The Bond/s 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 renewal. D. Each Performance/Maintenance Bond shall be secured each year for a minimum of five years, and until DWR has released all Riparian Buffer Credits and Nutrient Offset Credits to the Bank Sponsor. Upon DWR approval, the bonds 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. E. Once DWR has released 100% of all credits for completion of all Bank Parcel milestones described in Table 3 of Section Vlll and in the corresponding BPDP, the Bank Sponsor will be released from its performance obligations under the performance bond/s required in "C-D" of this Section. F. To comply with this section, DWR must be the Obligee on all performance bonds. Monitorin_and Maintenance_Reports G. The Sponsor shall monitor the Bank Parcel, in its entirety, including all phases 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 phase of the Bank Parcel. H. 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 500,10 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. 1. A 'stem" means a woody seedling, sapling, shrub or tree, no less than 10 centimeters in height. J. If the performance standards of the vegetation are not met, supplcmcntal plantings maybe 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. K. Monitoring Reports for Riparian Buffer Credit and/or 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 no later than December 31 of each year for a minimum of five consecutive years after the first full growing season. if necessary, RS may elect to submit a separate monitoring report for each phase of the Bank Parcel as described in the BPDP. 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: l . 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 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/dcbit ledgers; and b. Corresponding verification letters from designated local governments upon request; and 7. Corresponding Mitigation Transfer Certificates upon request. 8. Proof of performance bond renewal to cover the next monitoring year (if applicable) Continuencv Plans/Remedial Actions L. 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. VII. CALCULATION OF CREDITS FOR THE BANK PARCEL Riparian Buffer Credits A. Alt Riparian Buffer Credits shall be determined based on the ratios and percentages provided in 15A NCAC 02B .0295 (m) and (n), B. Riparian buffer restoration on the Bank Parcel, as described in 15A NCAC 02B. 0295 (n), and defined in 15A NCAC 02B .0295 (b) that is performed on agriculture lands within the Bank Parcel, may be used for either Riparian Buffer Credit or nutrient offset Credit, but not both. C. Riparian buffer preservation on the Bank Parcel, as described in 15A NCAC 02B .0295 (o), and defined in 15A NCAC 028 .0295 (b) can only be used for Riparian Buffer Credit. D. Riparian Buffer Credit is defined as one (1) buffer credit per one square foot or 43,560 buffer credits per one acre. E. Pursuant to 15A NCAC 02B .0295 (1)(6)(B), "Buffer mitigation credit shall not be generated within wetlands that provide mitigation credit required by 15A NCAC 02H .0506".. Nutrient Offset Credits F. The acreage of Nutrient Offset Credits on the Bank Parcel submitted under this instrument is determined by applying the applicable ratio as provided in 15A NCAC 02B _0295 (m) for a Restoration Site. All riparian areas proposed for Nutrient Offset Credits must be a minimum of fifty (50) feet from the top of the bank along streams and ditches adjacent to land noted in the Site Viability Letter as agriculture. G. Nutrient Offset Credits cannot be achieved through the preservation activities performed on the Bank Parcel. f1. Nutrient Abatement of Restored Riparian Area/Buffers on Agricultural lands: 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, The pounds of phosphorus offset per acre of restored riparian areas/buffers shall be 146.40 pounds per acre, The Sponsor and DWR agree that the methodology and calculations for determining nitrogen and total phosphorus reduction, associated with restoration of riparian areas on this Bank Parcel 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. The approved method and calculations for determining nutrient reductions associated with the riparian restoration on this Bank Parcel is provided in further detail in Attachment B. 10 VIII. CREDIT RELEASE SCHEDULE A. Upon submittal of all appropriate documentation by the Sponsor, and subsequent approval by DWR, it is agreed that Riparian Buffer Credits and Nutrient Offset Credits associated with the Bank Parcel, in its entirety and including all phases, will become available for sale or transfer to a third party in accordance with the Credit Release Schedule in 'Table 3.0. B. If necessary, RS may elect to have a separate Credit Release Schedule for each phase of the Bank Parcel. All phases will be subject to the same schedule as provided in Table 3.0 below: 'Table 3.0 - Credit Release Schedule for Riparian Buffer and Nutrient Offset Credits % Credit Task Project Milestone Available for Sale Instrument and BPDP Approved by DWR, Conservation Easement l Recorded*, Financial Assurance Posted, and all utilities installed and in 20 compliance with state issued permiWauthorizations where applicable Site Earthwork, Planting and Installation of Monitoring Devices Completed ` 20 and all applicable permits obtained 3 Monitoring Financial Assurance Posted and Approval of As -Built Report 10 4 Monitoring Report#l: Approved by the DWR** & financial assurances 10 renewed Monitoring Report 42: Approved by the DWR** & financial assurances l0 renewed 6 Monitoring Report 43: Approved by the DWR** & financial assurances 10 I renewed Item B (1) of Section X in this Instrument has been completed and 5 approved b% DWR. f No remaining credits will be released until the conservation easement has j. been assigned to an approved land trust or stewardship 8 Monitoring Report 44: Approved by the DWR** & financial assurances S renewed 9 ( Monitoring Report 45 Approved by the DWR** and final site visit by 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 C. 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. IX. PROCEDURE FOR DEBITING AND CREDITING Credit Leelvers A. The Bank Sponsor shall maintain a credit ledger for each mitigation type for each phase of the Bank Parcel under this Instrument: Credit ledgers shall provide the accounting for Riparian Buffer Credits in square feet and acres, and Nutrient Offset Credits in pounds and acres. B. Each credit ledger shall be submitted on a separate 8 ''/2-in X I 1-in spreadsheet with legible font style and font size. All ledgers shall be submitted using the templates provided in Attachments D of this Instrument or any updated versions to these templates as provided by DWR. Credit Processing C. Riparian Buffer Credits generated on this Bank Parcel will be used to provide mitigation for authorized buffer impacts within the Tar -Pamlico River Basin according to 15A NCAC 02B .0295 (0 and (g). D. Nutrient Offset Credits generated on this Bank Parcel will be used to offset nitrogen and phosphorus nutrient loads within the 8-digit HUC 03020103 of the Tar -Pamlico River Basin in accordance with 15A NCAC 02B .0240. E. Available Riparian Butler Credits (credits that have been released by DWR but not sold by the Sponsor) that meet criteria for nutrient offset credits as outlined in Section VII of this Instrument, the Site Viability Letter and the corresponding BPDP can be converted and transferred from Riparian Buffer Credits to Nutrient Offset Credits upon written approval from DWR. Once a credit has been converted to another credit type, the transaction is permanent and the credit cannot be converted again. F. Available Nutrient Offset Credits (credits that have been released by DWR but not sold by the Sponsor) that are generated within 0- 100' from tops of banks and meet criteria for riparian buffer credits as outlined in Section VII of this Instrument, the Site Viability Letter, 15A NCAC 02B .0295 and the corresponding BPDP can be converted from Nutrient Offset Credits to Riparian Buffer Credits upon written approval from DWR. Once a credit has been converted to another credit type, the transaction is permanent and the credit cannot be converted again. G. The Bank Sponsor shall obtain written verification of nutrient otfset need from a designated local government within the 8-digit HUC 03020103 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 Bank Parcel. H. The Bank Sponsor shall obtain written verification of buffer mitigation required from the delegated local government in the Tar -Pamlico River Basin or DWR prior to debiting Riparian Buffer Credits from the Bank Parcel. 12 I. 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 the Bank Parcel by the tenth (I0`h) 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. Miti a� tion.Credit Transfer Certificates J. 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) Bank Sponsor Name, (2) bank parcel 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 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, (5) amount of Riparian Buffer Credits purchased in square feet and the confirmation from DWR or the local government of the amount required. 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 or DWR requiring Nutrient Offset Credits, and/or (6 — when applicable) DWR authorization number or delegated local government requiring Riparian Butner Credits for this project K. If the DWR determines that the Bank is operating at a deficit (e.g. the Sponsor is utilizing, selling, leasing or transferring credits that are not available), or the Bank is 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 shall be identified as the event when the Sponsor is relieved of all of its responsibilities to the Bank Parcel and there are no Riparian Buffer Credits or Nutrient Offset Credits left to sell. 13 B. Bank Parcel Closure shall commence only after all of the following events have occurred: 1. 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, and/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. 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 I -I 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 Vill, 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. DIYR 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. Mitigation determinationshnitigation viability assessments 14 3. Issuance of Site Viability Letters, 4. BPDP review and approval of items listed in Section V of this Instrument, 5, As -Built Report review and approval of items listed in Section VI of this Instrument, 6. Monitoring Report review and approval of items listed in Section VI of this Instrument, 7. Credit Ledger review and approval of items listed in Section IX of this Instrument, R. Certificate review of items listed in Section IX of this Instrument and cross analysis to credit ledgers and, 9, 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 terns 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. I. 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 Bank Sponsor: Restoration Systems Attn: Barrett Jenkins 1101 Haynes Street, Suite 211 Raleigh, NC 27605 15 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 L. Applicable Law: This Agreement shall be construed under the laws of the State of North Carolina. RESTORATION SYSTEMS, LLC .7—{Print) Title--/ Date: �av NORTH CAROLINA DEPARTMENT OF WATER RESOURCES By: IRONMENTAL QUALITY -DIVISION OF (Print) (Signature) Title: ' Date: /sue 16 ATTACHMENT A — Division of Water Resources Authority Document Updated Nutrient Offset Program & Buffer Mitigation Program 10/28/2019 Authorities for MBI ATTACHMENT A Authorities pertaining to the GUC 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.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 .0237 Best Management Practice Cost -Effectiveness Rate 15A NCAC 02B .0240 Nutrient Offset Payments 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 2B .0229 Nutrient Offset Payments for Non -Tar -Pamlico Basin Association Members 15A NCAC 2B .0255 Agricultural Nutrient Loading Goals 15A NCAC 2B .0256 Agricultural Nutrient Control Strategy 15A NCAC 2B .0257 Nutrient Management 15A NCAC 2B .0258 Basinwide Stormwater Requirements 15A NCAC 2B .0259 Protection and Maintenance of Existing Riparian Buffers 15A NCAC 2B .0261 Delegation of Authority for the Protection and Maintenance of Existing Riparian Buffers ATTACHMENT B - NCDWR - Methodology & Calculations for Nutrient Reductions on the Bank Parcel O O 0 LL Q' Y N C m 7 D N � �0 C U 0- 0 C 'C Z a m m m rm- O O U v y 10 NR'm D m m C' Z Z 0 0 0 d N N m m m N M a T O M O N N_ .O C a c O .c CD a� v 0 E 0 N O C U d O O `1 c0 0 CM d O � +r 7 V E c r 0 An CD E m N C rA cII ` m q _aj m 0 c c t m X O 0 O J E N 7 to cr N `m e 6f C d O Z 0 Cl) O N CO N M C •N A C (i a v W N CD U') ti CO Lo CO Ill� O) CN Cl) Ln C L tt go W 7 c co CA LO N N OOc-� O� C O M co > v 0� t W c cII 7 C C Q O � tit Cm m c c0 >CL �.c4•-NM W C C C N mmm F- N Q d c � c`a T U y c O J N d Q G O to 0 > rn O1 EU ` O C 0 O ca C C 0 X ca t U 0 E rn Y __ co O O C0 O C a N co E U .0 0 0 _ Y C O m> O U O cD N C d Q CJl N �+ d) N d X co ¢ (0 7 V N O 0L to N !F- U —� 0— L C N C m C O U a)E c af6i N N y r <0 ... 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