The continued growth of environmental banking represents the very real potential that environmental destruction can be reversed. The framework created with the 2008 Rule can be transferred in some fashion to all environmental assets we as a nation determine are worth protecting.
The provisions of the 2008 Rule are being successfully implemented in the banking industry. The following are the benefits of this robust industry:
Benefits to the Environment
An approved bank credit represents measurable, transparent success. If performance standards are not met, credits are not made available, and the environment does not absorb the deficit. Thus, success rates are nearly 100%. No other option produces this level of success. Banks have built-in safeguards to deal with shortfalls with their own resources.
Environmental banks are transparent and fair. They restore and maintain the environmental values they offset. They are creating an ever- growing body of acreage that is permanently protected and professionally managed without taxpayer burdens.
Benefits to Taxpayers
Banks pay taxes, which substantially offset the regulatory expense to taxpayers to approve them. No other option does this.
Taxpayers are not responsible for financial failures as is so often the case with ILF’s. NEBA noted that the “…potential for ILF Programs to lack transparency in reporting generates extraordinary problems, most notably financial liabilities.” They discovered that, “It is unclear who is liable or responsible for ILF program failure.”
Banks offset many smaller projects, which considerably reduces the cost to taxpayers for regulatory oversight.
Benefits to Developers
Data from the U.S. Army Corps of Engineers has determined that significant streamlining is achieved when bank credits are used for mitigation, reducing the time for approval by at least 50%.
Mitigation costs are known from the beginning. This opens the way for responsible project financial planning. Further funding for ILF programs is vulnerable to political shifts at the state-level.
Benefits to Regulators
The use of environmental banks drastically reduces the workload for regulatory staff. Instead of analyzing numerous relatively small mitigation efforts for every individual permit, regulatory staff can determine the mitigation required and document the purchase of the required bank credits when issuing a permit.
Benefits to NRD Program
When Washington discovered that NRD funds were often not achieving the desired results, they began to introduce banking into the program. In cases of severely contaminated Superfund sites that require many years of reclamation to return them to a clean environment, experienced bankers can create new, healthy habitat for affected species in nearby areas that are not contaminated.
NEBA is proud to be a part of this important work. Our Board members will continue to participate in expansion of the banking program for other types of unavoidable impacts to our Nation’s resources.