As the Department of Interior (DOI) begins its review of market drivers to answer to U.S. impacts on species and species habitat, it must remember that private Conservation Banking efforts across the U.S. have long been doing just that.
Conservation Banks have advantages over other forms of mitigation to offset unavoidable impacts to species habitats. Conservation Banks are generally of larger scale, apply greater expertise that the larger scale allows, and have assured adequate long-term funding. Conservation Banks result in private landowners with listed species on their property realizing a new economic engine that changes the species’ presence on their land from a liability to an asset.
Funding for conservation banks increasingly comes from traditional sources such as pension funds, university endowments, and private equity, which reasonably expect a return on investment commensurate with risk.
As the U.S. Department of Interior (DOI) reviews its position on species mitigation, one of its considerations should be to lower risk to conservation investors by clarifying expectations and procedures for all forms of mitigation, creating equivalent and high-quality standards for the market.
To allow private capital to invest in species-related mitigation, all forms of mitigation including permittee-responsible and Habitat Conservation Plans(HCPs) must all be governed by equivalent standards.
In wetland mitigation banking for example, implementation of the 2008 Mitigation Rule clarified expectations and procedures and, therefore, lowered risk to investors. This reduced risk has increased the access to long-term capital required to develop high-quality mitigation banks and increased overall investments to the space.
The Department should aim to create a level playing field enabling conservation capital to go to work, and at the same time assure quality outcomes across all forms of habitat and species mitigation.