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21–968 2017

S. HRG. 114–494 

THE PRESIDENTIAL MEMORANDUM ISSUED ON 

NOVEMBER 3, 2015 ENTITLED ‘‘MITIGATING 

IMPACTS ON NATURAL RESOURCES FROM 

DEVELOPMENT AND ENCOURAGING RELATED 

PRIVATE INVESTMENT’’ 

HEARING 

BEFORE THE 

COMMITTEE ON 

ENERGY AND NATURAL RESOURCES 

UNITED STATES SENATE 

ONE HUNDRED FOURTEENTH CONGRESS 

SECOND SESSION 

MARCH 15, 2016 

( 

Printed for the use of the 

Committee on Energy and Natural Resources 

Available via the World Wide Web: http://fdsys.gov 

(II) 

COMMITTEE ON ENERGY AND NATURAL RESOURCES 

LISA MURKOWSKI, Alaska, Chairman 

JOHN BARRASSO, Wyoming 

JAMES E. RISCH, Idaho 

MIKE LEE, Utah 

JEFF FLAKE, Arizona 

STEVE DAINES, Montana 

BILL CASSIDY, Louisiana 

CORY GARDNER, Colorado 

ROB PORTMAN, Ohio 

JOHN HOEVEN, North Dakota 

LAMAR ALEXANDER, Tennessee 

SHELLEY MOORE CAPITO, West Virginia 

MARIA CANTWELL, Washington 

RON WYDEN, Oregon 

BERNARD SANDERS, Vermont 

DEBBIE STABENOW, Michigan 

AL FRANKEN, Minnesota 

JOE MANCHIN III, West Virginia 

MARTIN HEINRICH, New Mexico 

MAZIE K. HIRONO, Hawaii 

ANGUS S. KING, JR., Maine 

ELIZABETH WARREN, Massachusetts 

COLIN HAYES, Staff Director 

PATRICK J. MCCORMICK III, Chief Counsel 

HEIDI HANSEN, Counsel 

ANGELA BECKER-DIPPMAN, Democratic Staff Director 

SAM E. FOWLER, Democratic Chief Counsel 

SPENCER GRAY, Democratic Professional Staff Member 

(III) 

C O N T E N T S 

OPENING STATEMENTS 

Page 

Murkowski, Hon. Lisa, Chairman and a U.S. Senator from Alaska ................... 1 

Cantwell, Hon. Maria, Ranking Member and a U.S. Senator from Washington .................................................................................................................... 7 

WITNESSES 

Bean, Michael, Principal Deputy Assistant Secretary for Fish and Wildlife 

and Parks, U.S. Department of the Interior ...................................................... 12 

Ferebee, Brian, Associate Deputy Chief, National Forest System, U.S. Department of Agriculture .............................................................................................. 21 

Longan, Sara, Executive Director, Office of Project Management & Permitting, Alaska Department of Natural Resources ................................................. 41 

Lashley, Doug, Managing Member, GreenVest ..................................................... 49 

Scarlett, Hon. Lynn, Managing Director, Public Policy, The Nature Conservancy ..................................................................................................................... 53 

Sims, Shaun, President, Wyoming Association of Conservation Districts, and 

Member, Wyoming Stock Growers Association ................................................. 60 

Skaer, Laura, Executive Director, American Exploration & Mining Association ........................................................................................................................ 65

ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED 

Bean, Michael: 

Opening Statement ........................................................................................... 12 

Written Testimony ............................................................................................ 14 

Responses to Questions for the Record ........................................................... 87 

Cantwell, Hon. Maria: 

Opening Statement ........................................................................................... 7 

Opening Statement of Hon. John H. Chafee before the Committee on 

Environment and Public Works on March 14, 1996 .................................. 9 

Ferebee, Brian: 

Opening Statement ........................................................................................... 21 

Written Testimony ............................................................................................ 23 

Responses to Questions for the Record ........................................................... 110 

Lashley, Doug: 

Opening Statement ........................................................................................... 49 

Written Testimony ............................................................................................ 51 

Response to Question for the Record .............................................................. 131 

Longan, Sara: 

Opening Statement ........................................................................................... 41 

Written Testimony ............................................................................................ 44 

Responses to Questions for the Record ........................................................... 125 

Murkowski, Hon. Lisa: 

Opening Statement ........................................................................................... 1 

Letter to President Obama dated February 24, 2016 .................................... 3 

Scarlett, Hon. Lynn: 

Opening Statement ........................................................................................... 53 

Written Testimony ............................................................................................ 55 

Response to Question for the Record .............................................................. 135 

Supplemental Letter for the Record ............................................................... 140 

Sims, Shaun: 

Opening Statement ........................................................................................... 60 

Written Testimony ............................................................................................ 62 

Page

IV 

Sims, Shaun—Continued 

Responses to Questions for the Record ........................................................... 136 

Skaer, Laura: 

Opening Statement ........................................................................................... 65 

Written Testimony ............................................................................................ 67 

Response to Question for the Record .............................................................. 139 

(1) 

THE PRESIDENTIAL MEMORANDUM ISSUED 

ON NOVEMBER 3, 2015 ENTITLED ‘‘MITIGATING IMPACTS ON NATURAL RESOURCES 

FROM DEVELOPMENT AND ENCOURAGING 

RELATED PRIVATE INVESTMENT’’ 

Tuesday, March 15, 2016 

U.S. SENATE, COMMITTEE ON ENERGY AND NATURAL RESOURCES, Washington, DC. 

The Committee met, pursuant to notice, at 10:09 a.m. in Room 

SD–366, Dirksen Senate Office Building, Hon. Lisa Murkowski, 

Chairman of the Committee, presiding. 

OPENING STATEMENT OF HON. LISA MURKOWSKI, 

U.S. SENATOR FROM ALASKA 

The CHAIRMAN. Good morning. The hearing will come to order. 

The focus of our hearing this morning is a Presidential Memorandum issued in November 2015 entitled, ‘‘Mitigating Impacts on 

Natural Resources from Development and Encouraging Related 

Private Investment.’’ 

We originally scheduled this hearing in January to continue the 

Committee’s dialogue on mitigation which began last summer with 

a joint field hearing that we held with the Committee on Environment and Public Works. We were forced to postpone this hearing 

when we went to the floor with our broad bipartisan energy bill, 

but it has remained a priority for us and I am pleased that we 

have it back before the Committee today. That is because mitigation, as a Federal practice, has become a tool that, all too often, 

causes resource development projects to cost more and proceed 

slowly, if at all. 

For Alaskans seeking any form of development, whether it is a 

road, a mine or of any energy resource, mitigation has become almost a household word. This is also true throughout many Western 

states for grazing, timber harvest or again, any development across 

regions where the Federal Government owns so much land. 

The Presidential Memorandum provides a definition for mitigation, and I will quote here, ‘‘Mitigation means avoiding, minimizing, rectifying, reducing over time and compensating for impacts on natural resources. As a practical matter all of these actions are captured in the terms avoidance, minimization and compensation.’’ That is a long definition, but I think it is important to 

state because definitions are important. This definition of mitigation must be taken together with the President’s pronouncement of 

2 

a new mitigation principle. Again I will quote the Memorandum 

which says, ‘‘Agencies’ mitigation policies should establish a net 

benefit goal or, at a minimum, a no net loss goal for natural resources the agency manages.’’ 

It is true that President George H.W. Bush established a no net 

loss principle for wetlands, and that President George W. Bush 

challenged Federal agencies to expand wetlands outside the context 

of mitigation. This Memorandum dramatically asserts that agencies should establish a net benefit goal for mitigation, and applies 

that goal beyond wetlands to potentially all natural resources that 

an agency manages. For Alaskans and for the constituents of many 

Senators of this Committee, this spells trouble. 

There is reason to fear this Memorandum will, at a minimum, 

elongate an already lengthy permitting process, and at worse, encourage agencies to shut down development completely. Many fear 

that development will become an exercise in pay to play and only 

the largest businesses, with the most clearly profitable or the most 

highly favored projects, will be able to afford that unfair gain. 

The Administration will deny this and insist that its goal is to 

facilitate the balance, efficiency, interagency coordination and consistency across agencies that manage our Federal lands, especially 

as they issue permits for development. It discounts, it even discards, our concerns. 

The Administration claims to want, and again, I am quoting the 

Memorandum, ‘‘Strong environmental outcomes while encouraging 

development and providing services to the American people.’’ Now 

none of us would deny the importance of that, but when one looks 

at this Administration’s actions it is hard to believe that this is the 

true goal. 

To provide the Administration the opportunity to clarify its intent and address legitimate concerns, 18 of my fellow Senators and 

I sent the President a letter on February 24. I am providing a copy 

of that letter for the record of this hearing and each of the Administration’s witnesses. 

[The information referred to follows:] 

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The CHAIRMAN. The letter asks three basic questions about the 

Memorandum. Through today, we have received no response. 

Regrettably, the Council on Environmental Quality, the White 

House agency that apparently took the lead on the preparation of 

the Memorandum, was unable to provide a witness for today’s 

hearing. 

We will hear this morning from two panels of witnesses to help 

us try to make sense of this Memorandum and what it means for 

resource development. Our first panel will feature officials from 

two agencies under the Committee’s jurisdiction charged with implementing the Memorandum, and our second panel will feature 

some of those who stand to be impacted by it. 

The Memorandum has already led to confusion, mistrust and, in 

the State of Alaska’s case at least, even fear rather than the clarity 

and the streamlining it advertises; therefore, we will act swiftly to 

continue oversight on this topic and to ensure that it does not become yet another obstacle to responsible development. 

With that, I will turn to my Ranking Member, Senator Cantwell, 

for her comments this morning. 

STATEMENT OF HON. MARIA CANTWELL, U.S. SENATOR FROM 

WASHINGTON 

Senator CANTWELL. Thank you, Madam Chair, and thanks for 

holding this hearing. 

Mitigation is very general but a fundamental aspect of environmental policy. Last November the President issued a Memorandum 

seeking more effective and consistent mitigation of negative environmental impacts from natural resource development. 

Building on work already completed by the Department of the Interior, the President directed five Federal agencies to adopt clear, 

consistent mitigation plans. His Memorandum incorporates lessons 

learned over several decades from existing mitigation programs 

about how to provide more predictability and entice more private 

investment into conservation. I applaud this important, what I 

would consider, modest step forward and work with everyone at 

various stages of implementation and modernization. 

As the great conservationist, Aldo Leopold, said and I should 

note that his daughter, Estelle, is a long time resident of Washington State and worked with the University of Washington, ‘‘Conservation will ultimately boil down to rewarding the private landowner, who conserves the public interest.’’ 

Beginning in early in the 20th century, Congress has included 

some kind of mitigation requirement in many statutes governing 

public lands and natural resources. It is bedrock law, but this was 

not always the case. For virtually all of the 19th century, Federal 

law did not require corporations or government officials to mitigate 

impacts of mining, logging, drilling, omissions or construction. 

It is not oversimplifying to say that the failure to mitigate is the 

reason we created our national parks, our national forests, why we 

passed the National Environmental Policy Act, the Clean Air Act 

and the Clean Water Act. We also established the Abandoned 

Mines Lands Program and created a Super Fund because failure 

to mitigate these impacts of factories and mines had an impact on 

all of us. 

8 

As we have learned in every state in this country, it is much 

more expensive to fix the unmitigated development after the fact, 

than it is to do the right thing up front. 

So I hope that we don’t try to re-litigate all of these things, but 

my hope is that we move forward. Today, before we hear from our 

witnesses, I want to emphasize two points. 

First, the Presidential Memorandum does not create any new 

mitigation requirements at any agency. It is merely guidance. At 

every agency, the legal requirements to mitigate harm to the environment were the same the day before the Memorandum as the 

day after. In fact, the Memorandum is peppered with caveats about 

how it should be applied. Phrases like ‘‘to the extent allowed by an 

agency’s authority’’ and ‘‘consistent with existing legal authorities’’ 

appear about ten times in a five-page document. So the President 

is acting well within the boundaries set by Congress. 

The second point I want to emphasize is that the concepts in the 

Memorandum have long and bipartisan support over a long period 

of time. Beyond the general directive to make mitigation more consistent across Federal agencies, and I believe, to make sure that we 

are good stewards, there are two significant directives. 

First, agencies should establish a ‘‘net benefit’’ goal or ‘‘at a minimum, no net loss.’’ Second, agencies should encourage advanced 

compensation mitigation, including mitigation banking. It was 

George H.W. Bush who established the ‘‘no net loss’’ policy for wetlands in an Executive Order in 1989. Fifteen years later it was 

George W. Bush who established the ‘‘net gain’’ policy for wetlands, 

moving beyond the goal of stemming the tide of habitat loss. 

Now, I don’t think that monetizing nature is always the best way 

to manage it, but in many cases it has created an incentive that 

brings private sector investment into an equation that can result 

in better outcomes. And this is old news. Many of our colleagues 

over a period of time have worked for this. 

Senator John Chaffe, the Chairman of the Environmental Public 

Works Committee, was a champion of mitigation banking. I ask 

unanimous consent to enter into the record a statement from his 

hearing 20 years ago on the topic. 

The CHAIRMAN. Without objection. 

[The information referred to follows:] 

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Senator CANTWELL. One of those things that he said was, ‘‘One 

of the most gratifying things about mitigation banking is that it enjoys wide support. It can reduce the time and expense incurred by 

permit applicants in working with the Federal and state officials.’’ 

Senator Chaffe was not alone. Senator Kip Bond of Missouri said 

this about mitigation banking on the Floor in 1999, ‘‘As a matter 

of policy, we have a great opportunity with mitigation banking to 

protect wetlands by making wetland protection a profitable, private 

enterprise.’’ 

Even Majority Leader then, Trent Lott, felt the same way. He 

called mitigation banks, ‘‘An incentive-based strategy for environmental protection that enjoys bipartisan support. Mitigation banks 

provide great environmental benefits better than piecemeal mitigation.’’ 

I understand this hearing today, but I want to say that I think 

these issues have long been discussed by our former colleagues. 

They have recognized that once regulators can decide that a proposed mine and highway upgrade or oil-filled exploration or wind 

farm or other development should move ahead, it is really a simple 

question of how to just mitigate the resulting damage. For decades 

now most agencies have had different answers. The result has been 

a patchwork of ad hoc mitigation that neither matches the cumulative effects of the development nor provides any predictability. 

We can do better in this. 

In the State of Washington, managing growth in Puget Sound 

has often been challenging. We currently have 18 wetland mitigation banks spread across ten counties. These banks have helped my 

state improve the patchwork approach. 

As we will hear in a moment, the Interior Department has begun 

to approach mitigation more systematically as well. The establishment of solar energy zones in the Southwest, while not a perfect 

process, has been an early test of the concepts in the Presidential 

Memorandum. 

Madam Chair, I hope that we will hear more from our witnesses 

today on this issue and continue to make sure that we are making 

improvements so that we are the good stewards that are required 

of us. 

Thank you. 

The CHAIRMAN. Thank you, Senator Cantwell. 

We have two panels here this morning. On our first panel we 

have Mr. Michael Bean, who is the Principal Deputy Assistant Secretary for Fish and Wildlife. Mr. Bean is here on behalf of the Department of the Interior. I understand he will be able to speak to 

policy for the whole department including both the Fish and Wildlife Service side as well as Bureau of Land Management. 

Also joining us is Mr. Brian Ferebee, who is the Associate Deputy Chief of the National Forest System, to discuss how the Department of Agriculture is incorporating the Presidential Memorandum into its mitigation work. 

Gentlemen, thank you for joining us this morning. 

Mr. Bean, if you want to proceed first with your five minutes, 

then we will go to Mr. Ferebee and have an opportunity for questions. 

So welcome. 

12 

STATEMENT OF MICHAEL BEAN, PRINCIPAL DEPUTY ASSISTANT SECRETARY FOR FISH AND WILDLIFE AND PARKS, U.S. 

DEPARTMENT OF THE INTERIOR 

Mr. BEAN. Thank you, Chairman Murkowski, Ranking Member 

Cantwell, members of the Committee. Thank you for the opportunity to testify before you today regarding the Department’s policies and practices relating to mitigation and the recent Presidential 

Memorandum on that subject. 

The Department is committed to facilitating responsible economic 

development both on public lands and elsewhere while protecting 

and conserving both natural and cultural resources. Effective mitigation practices are key to accomplishing those dual goals. 

As my written statement describes in more detail, the Department and its agencies, particularly the Fish and Wildlife Service, 

have been given Congressionally-mandated mitigation responsibilities as far back as 1934 with enactment of the Fish and Wildlife 

Coordination Act which requires that wildlife conservation receive 

equal consideration with other features of water resource development programs. 

The Fish and Wildlife Service issued a formal mitigation policy 

as far back as 1981. Its purpose was to guide the implementation 

of the service’s mitigation responsibilities under the Coordination 

Act, the National Environmental Policy Act and other laws. 

Last week on March 7, the Service announced proposed revisions 

to its policy to provide a framework for more efficient and effective 

mitigation measures while facilitating a review and approval of development projects. 

As my testimony also details, the experience gained by our sister 

agencies, the Army Corps of Engineers and EPA, under Section 404 

of the Clean Water Act, have been very informative for the Department’s ongoing efforts to improve its own mitigation policies. The 

mitigation rule published by those two agencies in 2008 dealt 

thoughtfully and constructively with a broad array of mitigation 

issues. It improved the transparency and predictability of mitigation decisions. 

Based on the Department of the Interior’s own mitigation experience and that of its sister agencies, Interior Secretary Sally Jewell 

issued an order in Fall of 2013 on improving mitigation policies 

and practices of the Department. In that order Secretary Jewell directed the Department and its Bureaus to follow a common set of 

principles for its mitigation decisions and use a landscape scale approach to guide deciding and compensatory mitigation efforts. 

The policy issued last Fall was one of many steps to be completed 

in response to the Secretary’s order. That policy set forth a number 

of principles to guide mitigation decisions. Among them were that 

the sequence of avoidance first, then minimization of impacts, and 

finally compensation should generally be followed, and otherwise 

that all mechanisms for compensatory mitigation should be held to 

the same standards. Another was that beneficial impacts of mitigation should endure at least as long as the impacts being mitigated. 

Rather than break new ground these and other principles represent best practices gained from decades of experience and can be 

found in policy documents dating back to prior Administrations. 

13 

Consistent with the Secretary’s order and Departmental policy, 

the Department’s Bureaus are revising their mitigation policies to 

ensure they’re responsive to emerging best practices and compatible with similar policies being developed by sister agencies and 

states. 

The Departmental policy was issued contemporaneously with 

issuance by the President with the Presidential Memorandum. This 

Memorandum is consistent with and reinforces the mitigation work 

already ongoing at the Department, encourages private investment 

and restoration for mitigation purposes and provides expanded 

mitigation options for development interests. 

The Memo was designed to ensure consistency and transparency 

as agencies across the Federal Government develop mitigation 

measures. The Department is committed to working collaboratively 

and sharing its experience in developing mitigation measures that 

provide certainty and predictability to project proponents. The Department is continuing its work with partner agencies, including 

Agriculture and EPA, to share and adopt a common set of best 

practices to create an environment that allows us to build the economy while protecting healthy ecosystems. 

In sum, the dual goals of advancing safe and responsible development while promoting the conservation of America’s lands and natural resources for generations to come can be furthered through intelligent mitigation policies. The Department is working to ensure 

mitigation is applied consistently, predictably and effectively so 

that permit applicants and developers can proceed with projects 

that achieve their needs while protecting our nation’s valuable natural and cultural resources. 

Thank you for your interest and for the opportunity to testify 

today. 

I’m happy to answer your questions. 

[The prepared statement of Mr. Bean follows:] 

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The CHAIRMAN. Thank you, Mr. Bean. 

Mr. Ferebee. 

STATEMENT OF BRIAN FEREBEE, ASSOCIATE DEPUTY CHIEF, 

NATIONAL FOREST SYSTEM, U.S. DEPARTMENT OF AGRICULTURE 

Mr. FEREBEE. Madam Chair, Ranking Member Cantwell and 

members of the Committee, thank you for the opportunity to discuss the efforts of the Forest Service to implement the recent Presidential Memorandum on mitigation. 

The Forest Service’s goal is to enable responsible, economic development on National Forest System lands while protecting natural and cultural resources. Our laws, including the Organic Act 

and the Multiple Use Sustained Yield Act, authorize the agency to 

appropriately minimize affects from the use of National Forest System lands to sustain goods and services the public receives from 

those lands. 

The Forest Service currently works with the proponent and the 

public to identify and mitigate impacts to a broad range of resources from activities on National Forest System lands. 

We first look to avoid impacts, then to minimize impacts, and finally to compensate residual impacts to important resources. This 

is known as implementing the mitigation hierarchy. 

We proactively work with proponents in the design and siting 

phase in order to reduce adverse impacts to resources. If adverse 

impacts can be avoided, no further mitigation actions are necessary; however, sometimes it is not practical or possible to avoid 

adverse impacts and we work with the proponents to minimize impacts to the extent practical. 

Only at that point do we consider compensatory mitigation to address remaining impacts to improve or to import no sensitive resources. In that case, the agency identifies appropriate mitigation 

actions through a project review and engagement with other Federal agencies, states, tribes, the proponent and the public. We find 

that proactive work with the proponent and the implementation of 

the mitigation hierarchy can lead to successful projects with improved outcomes for local communities, proponents and the National Forest System. 

While individual units of the Forest Service have been successful 

in developing and implementing proponent driven projects that involve compensatory mitigation, the Forest Service, overall, does not 

have as much experience as other agencies. The Presidential 

Memorandum calls for the Forest Service to develop policy on mitigation. The direction provides an opportunity for my agency to 

learn from past experiences and develop a consistent, systematic 

approach to mitigation for the future. 

As public input is important when developing new policies and 

procedures, we will engage with our stakeholders, including proponents, as we move forward. We are also focusing on learning 

from those with extensive expertise in this area, including other 

Federal agencies, states, tribes and non-profits. A new agency policy will help us make our implementation of the full suite of mitigation options more consistent, predictable and effective. 

22 

Thank you for the opportunity to present this testimony, and I’ll 

be glad to answer your questions. 

[The prepared statement of Mr. Ferebee follows:] 

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The CHAIRMAN. Thank you, Mr. Ferebee. 

Let’s go ahead and begin this morning. Before I get into my questions, the letter that I mentioned in my opening statement that I, 

along with 18 other Senators, sent to the President on February 

24th, have both of you seen that letter? 

Mr. BEAN. Yes. 

Mr. FEREBEE. Yes. 

The CHAIRMAN. Recognizing that you have seen it, do you know 

where we are with a response to that inquiry? As you know there 

were three very specific questions that we had outlined. Are you, 

your respective agencies, working on a written response to our letter? 

Mr. BEAN. I do not know the status. 

The CHAIRMAN. Mr. Ferebee? 

Mr. FEREBEE. I do not know the status either. 

The CHAIRMAN. Have you been asked for input to the letter to 

respond to those questions? 

Mr. BEAN. I have not as yet. 

Mr. FEREBEE. I have not as yet either. 

The CHAIRMAN. Okay. Well this is important for us to, exercise 

the level of oversight that, I think, is important. I would like to 

think that the President, or whether it is CEQ who is drafting the 

response, that they would certainly seek input from the agencies 

tasked with implementing this Memorandum. Hopefully from what 

we get with the hearing this morning, we will see greater commitment to a response. 

I will begin with you, Mr. Bean, as you are speaking on behalf 

of Department of the Interior. To what extent do the agency’s legal 

authorities prohibit or modify the application of the principles and 

mandates outlined in this Presidential Memorandum? That is actually one of the direct questions that we included in that letter. 

Mr. BEAN. Yes. The policy, the Memorandum, is quite clear, I 

think, that in Section 1 its purposes are to be accomplished consistent with existing missions and legal authorities. In Section 5 of 

the Memorandum it states that it is not intended to supersede existing laws and shall be implemented consistent with applicable 

laws. 

So I think the answer is that it has not changed, it is not intended to change, any legal authority that the Interior Department 

or other agencies have. 

The CHAIRMAN. Given that, given the fact that you have differing 

legal authorities of the agencies, how does this Memorandum result 

in these consistent standards and guidance while at the same time 

giving what you are referring to as right-tailored approaches? 

I will further clarify my question here because what the concern 

has been is that different agencies have differing interpretations of 

not only definitions of words, but of standards and guidance. So 

what the aim of this Memorandum is to do is to lead to policies 

that are clear, work similarly across agencies and are implemented 

consistently across agencies. How do you do that if you have differing legal authorities, different interpretations? How do you make 

that work? 

Mr. BEAN. I’m happy to offer an answer to that, Senator. 

27 

I think the answer is that each agency can follow a set of general 

principles that are consistent across the agencies. 

For example, the preference given to advanced compensation. 

From experience over the last several decades, it’s quite clear that 

mitigation efforts don’t always succeed. They sometimes fail. 

The advantage of mitigation banking, for example, is that it ensures successful mitigation prior to impacts being authorized. So to 

the extent agencies have the authority to favor advanced mitigation, this policy encourages them to use that authority. 

The policy also makes clear that there should be equal standards 

or comparable standards for various forms of mitigation. What I 

mean by that is as follows, when mitigation is required there are 

typically at least three ways it can be addressed. 

The permittee or developer can carry out mitigation activities 

him or herself, or the permittee or developer can purchase credits 

from a mitigation bank or can make a contribution to what is 

known as an in lieu fee fund. But the point is that, whichever 

method is chosen, the standards should be the same so that there’s 

a level playing field, so that’s a principle that is reflected in this 

Presidential Memorandum as well. 

The CHAIRMAN. But are the standards the same between what 

BLM applies verses what Forest Service applies? 

Mr. BEAN. I can’t speak as to the Forest Service. I would say 

within the Interior Department the effort is to have similar principles guide mitigation decisions for all Interior agencies whether 

it’s Fish and Wildlife Service, BLM or others. 

The CHAIRMAN. Well, I know that that is the design of the 

Memorandum. 

My five minutes are up and I want to press further in this because I think this is exactly our problem. It looks good on paper 

but convince me how the application actually comes to bear. 

Senator Cantwell. 

Senator CANTWELL. Mr. Bean and Mr. Ferebee, one of the questions is about mitigation and durability. We obviously are in a very 

changing environment, particularly with climate change and habitat loss, ocean acidification, drought, fire, makes all the mitigation 

issues even more challenging. So how do agencies adapt to these 

projects under that kind of just dynamic change in the ecosystem? 

Mr. BEAN. I’ll be happy to offer an answer to that. 

I think you’re correct that climate change does introduce a new 

element of uncertainty as to the future of mitigation projects and 

their ability. So to the best of our ability we try to take into account the projected future for a mitigation site to ensure that if it’s 

going to be designated as mitigation, to compensate for some allowable development. It will endure over time. 

The durability issue is most often raised in context of ensuring 

that commitments made on public lands can be sustained over time 

on private lands, conservation easements, conveyance, other property interests can be fairly effective ways of securing commitments 

that endure over time. On public lands the challenge is to have a 

commitment for compensation or for mitigation that survives the 

next planning cycle, but you’re certainly right that climate change 

introduces a new element of uncertainty which we are just beginning to grapple with. 

28 

Senator CANTWELL. Mr. Ferebee. 

Mr. FEREBEE. Thank you for the question, Senator Cantwell. 

While the Forest Service is in the process of developing its national policy, the terms like durability are the types of terms that 

we are trying to think through, engage with our Federal and state 

partners, as well as the private sector, that see the type of work 

that they’ve done as they address this particular term as well as 

many other common terms that are used when it comes to mitigation. 

And so, our answer to your question, given where we are with 

respect to just developing our national policy, is this term and 

many other terms are the types of terms that we are engaging with 

our partners in trying to learn from their experiences to ensure 

that we’re developing a policy that’s not only good currently, but 

good going forward in the future. 

Senator CANTWELL. Well when I just think about my own state 

and, believe me, we have had the most challenging questions for 

sure, science. Science has always been our guide. 

While, I know, these are changing dynamics, I guess I would just 

continue to say that while the term durability here is a concern or 

interest or what have you, because of those changing dynamics, 

this is all based on science. That is what we have to continue to 

focus on. 

One question I do have is maybe an over reliance on compensation. I do not have an example here where that has become a problem in our state, but beyond the mitigation hierarchy in which you 

want to make sure that there are agencies working together, how 

do you avoid making sure that somebody just does not prioritize 

market solutions as opposed to maybe just saying no to a project 

because you should have said no or the market solutions dominate 

over broader policies? Is that a concern? 

Mr. BEAN. My understanding is to take the example of the Corps 

of Engineers and their Clean Water Act Program that a relatively 

few of the permits that they issue require compensation because 

they have successfully avoided or minimized impacts to a point 

where they are insignificant. For those remaining projects that receive permits that require some element of compensation, over 40 

percent of those in recent years have been able to compensate by 

a purchase of credits from mitigation banks. 

So it’s a relatively small subset, and that example of projects 

that are allowed to go forward based upon compensation and of 

those a substantial fraction choose the mitigation banking credit 

purchase option as a preferable alternative that speeds mitigation 

and facilitates permitting. 

Senator CANTWELL. I am glad you said that word because that 

is the notion that comes to mind to me is basically it forces people 

to think ahead and it allows for the development to happen in a 

faster time period because you decide, up front, what mitigation 

needs to happen across a broad area. 

My time is expired, Madam Chair. 

The CHAIRMAN. Senator Capito. 

Senator CAPITO. Thank you, Madam Chair, and I want to thank 

our witnesses today. 

29 

Mr. Ferebee, I have a question in the Monongahela and the 

George Washington National Forests which are in West Virginia. 

Dominion recently had sited a pipeline, and it was undergoing 

the FERC process. It was going through, in and around the Cheat 

Mountain region, and the Forest Service objected to the planned 

route as part of the FERC process. The route was then altered. 

They have altered their route to add another 30 miles to the pipeline to avoid the specific areas. 

Using that as an example, one of the concerns that I have with 

this Memorandum is the vague and, somewhat, variable applications. As a matter of fact, Ms. Goldfuss, with the Council of Environmental Quality, said recently in a House hearing that companies should simply pick a smart place to build their project. 

This particular pipeline and others I am sure around the country 

go through not just public lands, but through private lands as well 

when they are being sited. I would like to know what extent you 

think these new mitigation regulations could have, what kind of 

impact they might have on a project such as that, a project that 

is a public/private project? 

Mr. FEREBEE. Thank you for the question, Senator. 

So the national policy that we’re currently working on will have 

no effect on currently being worked upon projects. We are having 

conversations internally as we develop our national policy to make 

sure our employees, that are engaging in activities that may require either avoidance, minimization or compensatory mitigation, 

understand, kind of, the thinking within the agency as we develop 

our policy so that we won’t have to go back to proponents and have 

modification of projects. So, our intent is to continue to work with 

those proponents, move those projects forward and not go back and 

revisit them. 

Senator CAPITO. Well, in terms of the private land issue, is that 

something that is taken into consideration on something that is a 

60-mile or it is longer than that? If you say you discontinue into 

the public land, you are not allowed to go into these areas, obviously that is going to have an impact on the private landowner on 

the other side. Is that something you think could be influenced by 

these mitigation requirements? 

Mr. FEREBEE. So, our experience and our practice typically is 

when we are engaging in those types of activities, we really try to 

bring all of the key players to the table so we can have a conversation and look at the landscape and the project that’s being proposed 

and try to work with the proponent to come up with the best alignment for both the proponent and all the affected, and potentially 

affected, landowners. And so private landowners would be a part 

of that conversation. 

Senator CAPITO. So that they could be affected by that. 

Let me ask you on the compensation issue, advanced compensation. That is certainly not a new concept. Those mitigation banks 

are utilized now and would be a part of this new Memorandum 

that has been issued. 

Do you believe that the economic burden for some companies to 

develop these durable mitigation plans—when you are talking 

about buying into a mitigation bank—does that disadvantage a 

small business in any way? Does it become prohibitive to them and 

30 

only the larger, more well-funded entities are going to be able to 

enter into these kinds of agreements? 

I would like to hear comment from both of you on that. 

Mr. BEAN. I’d be happy to try to answer that, Senator. 

I think the goal here is to have the mitigation requirement, the 

compensatory mitigation requirement, reflect the impact of the development project. 

Senator CAPITO. Right. 

Mr. BEAN. And it would be respective of the size of the pocketbook, if you will, of the developer. 

Senator CAPITO. Right. 

Mr. BEAN. As a matter of principle what this and other policies 

related to mitigation try to achieve is certainty that the impact 

being mitigated is fully mitigated. So it’s irrespective of the size of 

the developer or the project proponent. It has everything to do with 

the size of the impact of the project itself on a particular resource. 

Mr. FEREBEE. The Forest Service, okay, there we go. 

The Forest Service would take a very similar approach. We 

would focus on the impact to be minimized to ensure that we redeem our responsibility. 

Senator CAPITO. Right. 

Mr. FEREBEE. When it comes to meeting our multiple use, sustained yield Agriculture responsibilities. 

Senator CAPITO. Okay. 

Thank you. 

The CHAIRMAN. Senator King. 

Senator KING. Thank you, Madam Chair. 

This is an interesting issue. I want to go back, not talk about the 

Memo itself, but the fact of the Memo and what it is. It is not an 

Executive Order, is that correct? 

Mr. BEAN. That’s correct. 

Senator KING. And it is careful, I note, at the end and at the beginning to say that whatever is in the Memo is subject to all existing laws and authorities. That’s correct? 

Mr. BEAN. Yes, Sir, that’s correct. 

Senator KING. So again, the question arises. What is it? 

I am familiar with Executive Orders. I am familiar with regulations. I am familiar with guidance. I am familiar with statutes. I 

am familiar with the constitutional provisions. But what is this 

creature? What is the legality of this Memo? It sort of says here 

is what we want you do to, but you do not have to do it if it is inconsistent with your statute. I am not being argumentative, I just 

want to understand where this fits into the, sort of, constitutional 

scheme of the President’s authority. 

Mr. BEAN. Certainly it does not expect or require agencies to do 

things they lack the authority to do. My understanding is to the 

extent agencies have the discretion within their existing authorities 

to act consistently with the Memorandum, the Memorandum directs them to do so. But it does not either create new authority or 

contradict existing authority. In that respect it’s very similar to an 

Executive Order which also directs Federal agencies to use their 

existing discretionary authorities in particular ways. 

Senator KING. I think the goals are salutary that the idea, I 

mean, of the language encouraging agencies to share and adopt a 

31 

common set of their best practices to mitigate, et cetera. That 

makes sense. I mean, that is good Administration and good practice. 

I am still unsure about the legal basis for, you know, consistent 

with my responsibilities it shall be the policy of the Department of 

Defense. In other words, the document seems a little schizophrenic 

in that it sounds prescriptive. Shall and then it says, unless the 

statute says you cannot. I do not want to dwell on this, but I think 

it is an interesting, sort of, separation of powers question. 

Going to the substance. The problem that I see, and again, I 

think the goals are salutary, is we always seem to run into trouble 

with one-size-fits-all prescriptions. The Bureau of Land Management may have a whole different set of problems and a situation 

in Utah may be entirely different from a situation in West Virginia 

or Pennsylvania. 

Do you feel that the policies and principles that are established 

are of enough general application that we will not get into a problem where an agency say, well the President has told us to do this, 

but that may not be the appropriate fit for that situation? Do you 

see the problem that I am seeking? 

Mr. BEAN. Yes, Senator. 

I believe that the purpose and effect of the President’s Memorandum is to articulate some general principles of broad applicability and not to focus narrowly on particular outcomes or particular projects, but rather to provide an overarching set of principles to guide how agencies apply their mitigation authorities. 

I think it, to a large degree, simply assembles in one place, a 

number of existing best management practices that are the product 

of decades of experience by the Fish and Wildlife Service and others trying to implement mitigation programs. 

Senator KING. I presume there is some sharing of these kinds of 

best practices now but the Memorandum, sort of, brings into focus 

that as a policy decision or as a policy directive of how the agencies 

are to carry out their responsibilities? 

Mr. BEAN. Yes, that’s correct. 

I think I referred a moment ago to the 2008 rule of EPA and the 

Army Corps of Engineers under the Clean Water Act which really 

was a well-considered and thoughtful rule to articulate, again, 

some fairly general standards for mitigation. The experience that 

those agencies have had implementing that authority as well as 

the Fish and Wildlife Service’s experience implementing its 1981 

policy that really informed mitigation practice throughout the Federal Government and has enabled the President, in this Memorandum, to bring together those best management practices under 

a single Memo. 

Senator KING. In a few seconds left, talk to me about advanced 

mitigation. Is that a situation where you predict what the effects 

are going to be and you say here is what we are going to do to ameliorate those effects? 

Mr. BEAN. Yes. 

Many states, probably most state transportation departments, 

now have mitigation banks to carry out mitigation in advance of future highway development projects. They know they’re going to be 

building highways in the future. They know they’re going to have 

32 

to mitigate for those, so they have begun to anticipate that by investing in conservation actions and creating banks up front. So it 

is a way of anticipating future needs and having, if you will, offthe-shelf mitigation to accomplish that. 

Senator KING. May I have one follow up question, Madam Chair? 

The CHAIRMAN. Yes. 

Senator KING. How about a project that involves, in effect, comes 

with its mitigation in it, a renewable energy project, for example, 

that has benefits to the environment in minimization of emissions, 

et cetera. 

Does that count as mitigation or do you have to have a specific 

other mitigation? In other words, you’re siting an energy project 

that may have an impact on a stream. Does this Memorandum conceive that the Fish and Wildlife Service will take into account the 

environmental benefits of that project as opposed to its environmental costs or is it treated as a strip mall development? Do you 

see what I am saying? 

Mr. BEAN. Yes, I understand your question, Sir. 

I think that it will depend upon the resource that is affected. For 

example, in the case of a wind energy project which has clear environmental benefits in terms of reduced reliance on fossil fuels. If 

that project poses a risk of killing a Bald Eagle, the Fish and Wildlife Service will have to authorize that take of the Bald Eagle and 

it will have to ensure that minimization and compensation for that 

is part of the project itself. So the two aren’t necessarily addressing 

the same set of resource concerns. 

And as a general matter, I think the objective is to have the sorts 

of benefits you describe in your hypothetical project acknowledge 

and take into account. But they may not be directly relevant to the 

particular resource impacts for which the Fish and Wildlife Service 

or other agencies are responsible. 

Senator KING. That is the problem. 

I have had experience, for example, in hydro permitting where 

the Fish and Wildlife Service says we are only interested in the 

fish, and the environmental benefits of developing a renewable energy project and the reduction in asthma or whatever other benefits there are, that is not part of our equation. There is no balancing to be had. Comment on that. 

Mr. BEAN. Well in terms of the Fish and Wildlife Service applying the laws applicable to it, in that case, probably the Fish and 

Wildlife Coordination Act, the requirements of that law are that 

the Service at least recommend measures to give equal consideration to fish and wildlife impacts as project purposes. So the Service exercises its authority with respect to how that authority is circumscribed or defined by Congress. 

So again, if it’s a Bald Eagle or if it’s an endangered species, the 

Fish and Wildlife Service is obligated by law to ensure that impacts 

to those particular resources—— 

Senator KING. Those are the easy cases. I mean, that is a clear 

endangered species, but I am talking about more subtle, you know, 

trout population in the river. 

The point I am trying to make is if you are doing a project that 

has environmental benefits, that should be part of the analysis of 

33 

mitigation as opposed to if you are building a real estate development that has no externalities in terms of environmental benefits. 

Mr. BEAN. It certainly is taken into account as part of the NEPA 

process to evaluate the project and its alternatives. That’s probably 

the place where it is most salient. 

Senator KING. Thank you. 

Thank you, Madam Chair. 

The CHAIRMAN. Senator Gardner. 

Senator GARDNER. Thank you, Madam Chair, and thank you 

both for being here today. I have just a couple of questions. 

I think in Mr. Ferebee’s statement you said this Memorandum 

was designed to ensure clarity. I would like to drive maybe a little 

bit more toward finding that clarity, if we could. 

In the example from Senator King, the windmill, the wind turbine, takes an eagle and so the mitigation would be required up 

front by Fish and Wildlife Service. Could you walk me through, Mr. 

Bean, an example of what would be required of say, a coal mine? 

How would this effect a coal mine or coal lease? 

Mr. BEAN. That would depend upon what resources were affected 

by the coal mine or coal lease. 

The Fish and Wildlife Service, for example, would need to review 

that project if it took an endangered species. If it didn’t it would 

not be subject, I would guess, to Fish and Wildlife Service review, 

other than through the NEPA process. 

Senator GARDNER. But would the coal mine have to prove to you 

first that it did not or would you be proving that to them under 

this mitigation? I mean, is this going to trigger some kind of an 

ESA-style consultation process across the Federal Government to 

the agencies that are now involved? 

Mr. BEAN. I don’t think it will trigger any new process to the extent that a hypothetical coal mine on Federal land, for example, requires Federal approval. That would continue to be subject to the 

consultation process as it currently is. It would not be affected in 

any way by this Memo. 

Senator GARDNER. Would the Memorandum require then that if 

you are looking at the net benefit goal, no net loss goal, the mitigation avoidance, minimization and compensation, would then an 

agency of the Federal Government be looking at perhaps the coal 

mines’ climate impact as a result of this Memorandum? 

Mr. BEAN. I would say no, not as a result of this Memorandum. 

It probably would do so as a result of NEPA’s requirements however. 

Senator GARDNER. Okay. So there would not be any kind of mitigation requirement on carbon or anything like that as a result of 

the Memorandum? 

Mr. BEAN. That’s my understanding, correct. 

Senator GARDNER. Is there any look at the economic impact of 

the Memorandum’s requirements? 

Mr. BEAN. I don’t know what analysis of economic impact may 

have been done by the President or the Executive Branch. I don’t 

know. 

Senator GARDNER. Okay. 

Let me just ask you a series of questions here. Would access to 

a coal lease be more or less likely under this Memorandum? 

34 

Mr. BEAN. I don’t think it will be affected one way or the other. 

Senator GARDNER. You don’t think so. 

What about access to oil or gas leases? You do not think that 

would be effected by the Memorandum? 

Mr. BEAN. No, because what the Memorandum says several 

times is that it is to be implemented consistent with agencies’ authorities and is not to supersede or change existing law. 

Senator GARDNER. Do you think that a coal, oil or gas lease 

would be as timely as it is today or would it take more time to get 

the permit as a result of this Memorandum? 

Mr. BEAN. The objective is to provide for more timely review to 

expedite and facilitate permitting, in particular, large infrastructure projects really were the motivating factor behind this and 

other initiatives of the Administration. Projects like transmission 

lines that might cross multiple jurisdictions and require review by 

multiple agencies. The President recognized that we need to do a 

better job of expediting permit reviews for projects like that. 

Senator GARDNER. So you believe this will speed up the permitting process? 

Mr. BEAN. I believe it will, and I know that is its purpose, its 

intent. 

Senator GARDNER. And will those reviews be more costly or less 

costly with this Memorandum in place? 

Mr. BEAN. I believe that they will be money saving reviews. 

Senator GARDNER. Okay, what does that mean if we are talking 

about avoidance, minimization and compensation? How would you 

define this no net loss goal as it applies to say, a transmission line 

and how is that not going to cost somebody more money? 

Mr. BEAN. The compensation requirement is a requirement to 

take into account the impacts to a protected resource after all of 

the reasonable avoidance and minimization measures have been 

carried out. It’s a way, if you will, to internalize the externality in 

terms of its impact upon a protected resource. 

So for a particular project it may result in, it will result in a cost, 

whatever the compensation is, but I don’t think that cost is going 

to be any greater as a result of this Memo than it is currently. 

Senator GARDNER. I guess I am trying to understand what exactly this Memo does then if it is designed just to make things faster, it seems to add a couple of new requirements though, no net 

loss goal, net benefits, sensitive areas. It talks about compensation 

and irreplaceable character. I just do not understand quite the purpose then that this Memorandum, sort of legal limbo that it is in, 

is accomplishing. 

Mr. BEAN. Let me give you one example. 

The Memo encourages what is referred to as landscape-level decisions about mitigation. Historically the practice for mitigation has 

been to site mitigation, compensatory mitigation, as close to the 

area of impact as possible. In fact, over time however, it’s quite 

clear that isn’t always the most intelligent place to site compensatory mitigation. And in fact, if you take a step back and take a 

broader look at where needs for the protected resource are most 

acute, you might decide that it makes more sense, it does more 

good, to site the compensatory mitigation some distance from 

where the point of impact is. 

35 

So what this Memorandum does, among other things, is to encourage agencies to use that landscape-level approach in deciding 

where to site mitigation activity. 

Senator GARDNER. So for instance, if there was a timber project 

in Western Colorado that was approved, the agencies would go 

through their analyses and perhaps it was decided that there needed to be some kind of compensatory action taking place. As a result, perhaps that compensation could occur in Pennsylvania? 

Mr. BEAN. In theory, yes. I think that’s probably unlikely in 

practice, but it certainly could be someplace distant from the timber project in Western Colorado. It could be somewhere 100 miles 

or 200 miles away. 

Senator GARDNER. Is that a new requirement then on this that 

all of a sudden some, because this timber permit was approved 

here and they would have to do something in some other area, far 

removed from where they are doing. Is that something that takes 

place today? 

Mr. BEAN. To the extent that today there are requirements to 

compensate for impacts that are not avoided or minimized, it’s not 

a new requirement. 

Senator GARDNER. Could you give me an example, perhaps, of 

say, a Western Slope Colorado timber project that has been required to do something like this already? 

Mr. BEAN. Let me give you a different example from Colorado 

which is Colorado is one of five states that have together developed 

a conservation strategy for the Lesser Prairie Chicken. 

And under that strategy, coal, excuse me, not coal, but oil and 

gas projects who elect to participate pay a fee for participation in 

that mitigation program. And those fees are collected by the State 

of Colorado and the other four states and used to purchase conservation activities, easements or other enhancement activities. 

And those are sited where they do the most good for the Lesser 

Prairie Chicken. That may not be in very close proximity to where 

the development that is being mitigated is taking place, but it is 

in the place that does the most good for the resource. So that’s an 

example ongoing in which that’s the principle of using a landscape 

level view of where the conservation needs are greatest to site mitigation investments, where they’re most productive. 

Senator GARDNER. Mr. Bean, I am glad you used that example 

because I think there has been some discussion on whether the 

U.S. Fish and Wildlife Service acknowledges the good science that 

the State of Colorado has done. I will take that as an endorsement 

of the science that Colorado has put forward. 

Mr. BEAN. No question about the science. 

The CHAIRMAN. Senator Warren. 

Senator WARREN. Thank you, Madam Chair. 

In November the President introduced a Memorandum about 

how agencies should mitigate the impact on the environment of 

their actions and the actions that they approve, and the document 

outlines some pretty common sense steps. 

First, developers should try to avoid causing any damage to the 

environment. Second, if that doesn’t work, they should minimize 

the harm. And third, for damages that can’t be prevented they 

36 

should try to offset it in some way to make sure there’s no net 

harm to the environment. 

The Memorandum seems to aim for long lasting, meaningful offsets that the American people can be sure are actually happening. 

It seems like pretty basic stuff to me, but listening to some of the 

reaction to this Memorandum you might think this represents a 

shocking new initiative. So Mr. Bean, help me understand this. Is 

the type of mitigation described in the Presidential Memorandum 

a new policy for the Interior Department? 

Mr. BEAN. No, it is not. The Fish and Wildlife Service has had 

since 1981 a general mitigation policy that incorporates many, if 

not most, of the elements of the President’s Memorandum. So it is 

newly assembled in one place, if you will, and applicable broadly 

across the Federal agencies. But for the Fish and Wildlife Service 

there is not a lot that is new in it. 

Senator WARREN. Okay. 

And we have heard some suggestion that the mitigation policy 

outlined in the Presidential Memorandum somehow goes beyond 

current law. So Mr. Bean, could you describe the current authority 

that has allowed the Interior Department to require mitigation 

measures like those that are addressed in the Memorandum, the 

ones that are already there? 

Mr. BEAN. Yes, Senator Warren. 

I mentioned already several statutes that provide the authority 

for the Interior Department to recommend or require mitigation. 

They include the Fish and Wildlife Coordination Act which is a 

1934 statute, the Endangered Species Act—— 

Senator WARREN. You said 1934? 

Mr. BEAN. ’34. 

Senator WARREN. I just wanted to make sure I heard you. Keep 

going. 

Mr. BEAN. Yes, 1934. 

The Endangered Species Act, the Bald and Golden Eagle Protection Act, and others. The Service also routinely recommends to 

other Federal agencies through the NEPA process, mitigation 

measures for impacts to fish and wildlife resources, generally. 

Senator WARREN. Alright, thank you. 

Now there has been some talk that this Memorandum will somehow prevent future development of Federal land. So one more time, 

Mr. Bean, will this Memorandum prevent any projects from moving 

forward that would otherwise be able to proceed? 

Mr. BEAN. I believe the answer to that is no. 

Senator WARREN. Well, we have been using these mitigation efforts for a long time and they are backed up by solid law. Attempts 

to characterize this Presidential Memorandum as a radical, new, 

anti-development policy, sounds like to me it is just grasping at 

straws. 

This Memo says that if developers are going to damage some of 

our nation’s most precious resources then they should minimize or 

make up for the damage they do. Developers may squirm and kick 

about this, but it seems right to me. 

Thank you. Thank you for being here. 

Thank you, Madam Chair. 

The CHAIRMAN. Thank you. 

37 

I would like to get back to some more specific examples because 

I think it probably helps to give some clarity here. You mentioned, 

Mr. Bean, the example of a transmission line when you were 

speaking to my colleagues. But recognizing that the Departments 

that the two of you are representing have different underlying statutes and missions, if you have got a transmission line that is going 

to cross lands that both of your agencies manage, which authorities 

then will determine which or what form of mitigation is sought? 

Which agency would determine then which appropriate mitigation 

measures you look to? Which agency determines the metrics that 

are going to be used? Which agency is the arbiter? How do you decide, kind of, who is on top here? What do you do? 

Mr. BEAN. I’ll be happy to try to answer that, Senator. 

I don’t think the question is who’s on top? I think the question 

is how they would coordinate our respective reviews of the project? 

The CHAIRMAN. Well, because you have just said to Senator 

Gardner that you think that this process allows for a more expedited process but, again, you have got different mission sets, you 

have got different agencies. You are all involved in this together. 

How do you decide this process in a way that is quick, efficient, 

clear and with some certainty? 

Mr. BEAN. Through serious efforts to coordinate between agencies. 

The CHAIRMAN. Okay. Tell me how that works, because I do not 

know. The Alaskans that are sitting right behind you will tell you 

coordination between Federal agencies is great on paper but it does 

not exist in reality. So convince me. 

Mr. BEAN. I would say that in my experience dealing with renewable energy projects in the West, many of which entail Bureau of 

Land Management, Forest Service and other agency interests, 

sometimes Corps of Engineers’ interest, there’s been a fairly good 

record of coordination amongst those agencies to ensure that there 

is a common approach taken. And although each agency may have 

different jurisdictional responsibilities, the Corps, for example, focused on wetlands. The Interior Department focused perhaps on 

wildlife resources and others focused on other resources. In those 

examples, there’s been a fairly successful effort to have a common 

approach that allows projects to proceed with due speed and intelligent review. I don’t doubt that there are examples where it has 

failed or has not performed as well. 

The CHAIRMAN. I guess I am trying to think of one where it has 

worked in Alaska, because in my head I am going to GMT–1. I am 

going to CD–5. I am going to Shell. I am going to our miners in 

the Fortymile. I am trying to find one example we can actually look 

to and say that there was a coordinated effort within the agencies 

where, despite differing interpretations, there has been a better 

process. I am looking for one example because in Alaska we have 

not seen where it has worked yet. 

Let me ask another question, and I will include you in this, Mr. 

Ferebee. 

When we had the briefings by your respective agencies on this 

Memorandum, staff indicated that best available science would be 

used to determine what mitigation measures land owners would 

38 

use. Do your agencies use the same definition for what qualifies as 

best available science? 

Mr. BEAN. I don’t know that we have definitions, per se. I would 

say—— 

The CHAIRMAN. Well if you do not have a definition—and you say 

best available science is going to be used to determine what mitigation measures apply—how does this work? 

Mr. BEAN. I would say, first of all, that the best available science 

requirement is inherent in our responsibilities under the Administrative Procedure Act. 

The CHAIRMAN. Okay, if it is inherent in yours, and Mr. Ferebee, 

is it inherent in the Department of Agriculture to look to best 

available science? 

Mr. FEREBEE. Yes, and the Forest Service has it described. And 

how we describe it—— 

The CHAIRMAN. Okay, so you have got a definition. 

Mr. FEREBEE. Yes, we have it described. 

The CHAIRMAN. Okay. Do you know if it is the same as within 

Interior? 

Mr. FEREBEE. I do not know what the definition is. 

The CHAIRMAN. Don’t you think that that would be important if 

you are trying to provide for this expedited process that gives 

greater clarity to make sure that you are operating off of similar 

definitions? 

Mr. FEREBEE. I would say Senator, that as I think Mr. Bean said 

previously, I think agreeing on principles, understanding the differences around authorities but agreeing on principles and desire 

to end states a project—that’s the thing where we put most of our 

focus when we’re talking about compensatory mitigation efforts. 

The CHAIRMAN. I would not disagree that agreeing on principles 

is good, but when you get down to implementation and you have 

agencies that have different interpretations or different definitions, 

whether it is a different definition of what is best available science, 

a different interpretation of irreplaceable natural resources, a different interpretation of landscape scale, a different interpretation 

of watershed scape, it makes it tough to get to the place where, Mr. 

Bean, you are suggesting that this cooperation/collaboration really 

all works. 

My time has expired again, and I will turn to my colleagues here 

because we have got Senator Barrasso and then Senator Heinrich, 

and I am assuming Senator King you also wanted to ask a second 

round? 

Senator KING. I am here for the second panel. 

The CHAIRMAN. Okay. 

Senator Barrasso. 

Senator BARRASSO. Thank you very much, Madam Chairman. 

Mr. Bean, Mr. Ferebee, you know at the beginning of the hearing 

you were shown a letter and discussed the letter from February 

24th about this Memorandum. It almost looked like this was the 

first time you had ever seen the letter. Is that true? 

Mr. BEAN. No, Sir, I’d seen the letter previously. 

Senator BARRASSO. It just seemed that the responses we are getting was that people maybe had not read it or comprehended it. 

39 

Nineteen Senators, bipartisan from the Committee, I would ask 

will you commit to providing a response by April 1st? 

Mr. BEAN. I note the director, excuse me, the letter is directed 

to the President, so I really cannot commit the President to a particular date, no. 

Senator BARRASSO. Will you be participating in the response to 

it? 

Mr. BEAN. I do not know. 

Senator BARRASSO. I mean, if it is related to this, we will see if 

the President decides to ignore it. Is that the idea? Should I just 

maybe, change it and then send it to you directly? Would that be 

helpful in getting a response by April 1st from the Administration? 

Mr. BEAN. I’m sure you will get a response. I just don’t know 

when, Sir. 

Senator BARRASSO. Well we have seen this movie before where 

it is not even sure that we get a response. 

It is interesting the Memorandum places undue emphasis on a 

new concept called ‘‘advanced compensation,’’ which the Memorandum describes as opportunities to offset foreseeable, harmful 

impacts to natural resources in advance. 

The Memorandum goes on to directly link a potential reduction 

in permitting times to upfront mitigation. This means that project 

proponents may be required to pay millions in mitigation costs before their project even breaks ground. It seems to me just a way 

to hold projects hostage. Effectively saying that a permit will be delayed or not even considered at all unless some sort of advanced 

payment is made. 

Mr. Bean, in the future is there any guarantee this advanced 

compensation will ensure a project is approved? 

Mr. BEAN. Well, first let me say that advanced compensation is 

not a new concept. It’s been around since at least the mid-1990’s. 

And indeed, most states, including your own, I believe, the state 

transportation departments have indulged, have participated in advanced compensation by establishing mitigation banks for future 

highway projects. Those departments of transportation recognize 

that as they build highways in the future they will need to mitigate 

the impacts of those on wetlands, in particular. And so, most state 

DOTs, again, I believe including your own, have taken this initiative to establish mitigation banks to meet those future mitigation 

needs through advanced compensation. 

Senator BARRASSO. Is this a way to basically just prevent 

projects from developing and moving forward? 

Mr. BEAN. It’s a way to facilitate and expedite projects, Sir. 

Senator BARRASSO. I want to discuss the concept of irreplaceable 

natural resources for a moment. 

The Memorandum defines this term literally as something that 

cannot be restored or replaced. Does the Department consider finite 

natural resources to be irreplaceable? 

Mr. BEAN. I don’t know that the Department has a position on 

that. 

The Fish and Wildlife Service over the years has sometimes 

found some resources to be irreplaceable. For example, complex 

coral reefs on Hawaii, as one example, or in Colorado peat moss 

fans are among resources the Fish and Wildlife Service has found 

40 

to be irreplaceable because they accumulate over time in matter of 

inches over a millennium. 

Senator BARRASSO. My current concern goes to things like coal, 

oil, gas, things that are resources. Using terms like irreplaceable 

natural resources without context to me is confusing. It is vague. 

It could be applied without discretion. 

I think without a clear definition, and what you just described 

is very different than how others may interpret it, without a clear 

definition the agency could declare an entire landscape or watershed as irreplaceable. 

How can we expect your employees on the ground to make decisions about mitigation when we fail to actually have a substantive 

definition for this irreplaceable natural resource? 

Mr. BEAN. Well I would say that the Fish and Wildlife Service 

has had, since 1981, a policy that refers to irreplaceable resources 

and has not generated the sorts of confusion or inconsistency that 

you express a fear about. 

Senator BARRASSO. So could you provide for the record a written 

distinction between the Department’s definition of an irreplaceable 

natural resource and a scarce or sensitive natural resource? 

Mr. BEAN. I will be happy to try to do that. 

I would note that the Congress itself and the Federal Land Policy 

and Management Act referred to scarcity of resource without defining that, so we’re in the same boat with respect to that. 

Senator BARRASSO. Thank you, Madam Chairman. 

The CHAIRMAN. Thank you. 

Senator Heinrich. 

Senator Risch. 

Senator RISCH. Second panel. 

The CHAIRMAN. We do have a second panel and I would like to 

turn to them. I have a longer series of questions that I will submit 

for the record, and I would encourage my colleagues to do the 

same. 

But to both of you gentlemen, in the second panel we will be 

hearing from Sara Longan, who is the Executive Director for the 

Office of Project Management and Permitting in the Alaska Department of Natural Resources. In her recommendations, she has 

asked for a series of requests to be responded to by the Federal 

agencies, in terms of mitigation, such things as the requirement for 

a formal rulemaking process. 

She has made the request that it is made expressly clear how 

new Federal mitigation policies might impact non-Federal lands. 

The Memo and resulting dialogue has provided few assurances that 

new Federal actions will not impose new Federal mitigation policies affecting state, private, Native corporation or tribal lands. 

She also goes on to ask for clarifying guidelines as it relates to 

the Alaska Native Claims Settlement Act and the Alaska National 

Interest Lands Act (ANILCA). 

While these specific questions have not been raised directly here, 

know that I share Ms. Longan’s concerns and would like to have 

responses to that as well. 

The CHAIRMAN. With that, gentlemen, we will thank you and 

bring up the second panel. 

41 

While everyone is getting seated, I will introduce the panel very 

quickly. 

Dr. Sara Longan, who I just referenced, is the Executive Director 

of the Office of Project Management and Permitting at the Alaska 

Department of Natural Resources. She joins us to discuss her experience in Alaska helping to implement mitigation measures across 

both the Army Corps of Engineers and the Bureau of Land Management, and some of the lessons there. 

We have Mr. Doug Lashley, who is the Managing Member of 

GreenVest, LLC, here to speak about wetlands restoration; Lynn 

Scarlett, who is the Global Managing Director of The Nature Conservancy; and Mr. Shaun Sims, I will ask my colleague from Wyoming to introduce him. And finally, Laura Skaer. 

Ms. SKAER. Correct. 

The CHAIRMAN. The Executive Director for the American Exploration and Mining Association. 

Senator Barrasso, if you would like to introduce Mr. Sims? 

Senator BARRASSO. Thank you very much, Madam Chairman. 

I am so pleased to introduce Shaun Sims. He is a fifth generation 

rancher from Evanston, Wyoming. He serves as President of the 

Wyoming Association of Conservation Districts and is an active 

member of the Wyoming Stock Growers Association. 

He has served for more than a decade in his local Conservation 

District and was elected to the National Association of Conservation Districts Executive Board. Just last year Shaun and his wife, 

Lacey, were inducted into the Wyoming Agriculture Hall of Fame 

for their wonderful contributions to both agriculture as well as 

their communities in Wyoming. 

Shaun wears many hats. He offers a unique perspective to the 

Memorandum that we are here to discuss today. So welcome to 

Shaun and to the other witnesses. Thank you very much, Madam 

Chairman, for convening this hearing. 

The CHAIRMAN. Great, thank you. 

With that, we will begin with Ms. Longan and ask that you all 

try to limit your testimony to five minutes. Your full statements 

will be included as part of the record. 

Welcome to all of you. 

Ms. Longan. 

STATEMENT OF SARA LONGAN, EXECUTIVE DIRECTOR, OFFICE OF PROJECT MANAGEMENT AND PERMITTING, ALASKA 

DEPARTMENT OF NATURAL RESOURCES 

Ms. LONGAN. Thank you. 

Chairwoman Murkowski, Ranking Member Cantwell and members of the Committee, my name is Sara Longan. I am the Executive Director of the Office of Project Management and Permitting 

within the Alaska Department of Natural Resources. On behalf of 

Governor Bill Walker, thank you for this opportunity to testify. 

Today’s testimony will highlight mutual mitigation interests the 

state shares with the Federal agencies participating in the Presidential Memorandum on mitigation. At the same time, we have significant concerns with regard to implementation of the Memo and 

resulting policies that may, unnecessarily, duplicate and excessively burden resource development opportunities in Alaska. 

42 

I hope to address specific challenges and encourage our Federal 

partners to think creatively and within their existing authorities to 

improve the current mechanisms already in place to avoid, minimize and mitigate unavoidable impacts to resources. 

Collaboration among the agencies and impacted stakeholders is 

a must and should help foster a coordinated regulatory process that 

can be flexible and allow for responsible resource development 

while creating more effective modes of mitigation. 

It is concerning that the Memo is seeking new mitigation goals 

when existing mitigation requirements already impose significant 

challenges to both regulators and developers in Alaska. It has long 

been recognized that the no net loss policy is a particular concern 

in Alaska where 63 percent of the nation’s wetlands are found. 

These wetlands are predominately pristine, which offers a tremendously small inventory of threatened or previously disturbed wetlands that would even be eligible for mitigation. 

In 1994, the Army Corps of Engineers and the EPA produced the 

Alaska Wetlands Initiative Report, specifically noting Alaska’s 

unique challenges, concluding that a predictable and flexible regulatory program is essential. This report is referenced in the Clean 

Water Act 2008 Mitigation Rule; however, there is room for improvement to show how the Federal regulators are implementing 

their own advice by making the 404 program in Alaska more practical and flexible. 

The Bureau of Land Management is developing new mitigation 

requirements to offset impacts from development within the National Petroleum Reserve Alaska, NPRA, which ultimately required 

mitigation fees in the sum of $8 million from ConocoPhillips Alaska 

for the proposed Greater Moose’s Tooth 1, or GMT–1, project. For 

the past decade and longer the GMT–1 project area has been subject to multiple National Environmental Policy Act, NEPA, analyses and integrated activity planning resulting in numerous stipulations and lease mitigation measures; however, these Federal Government protections are seemingly unrecognized by BLM as they 

implement additional mitigation requirements and now attempt to 

require more compensatory funds from developers. 

Conoco voluntarily provides mitigation payments to communities 

impacted by GMT–1, including the critical supply of natural gas to 

the Native Village of Nuiqsut, which is a much cleaner and cheaper 

alternative to diesel burning. Multiple subsistence programs, education and workforce development and emergency response assistance programs are funded by Conoco in order to fulfill the company’s efforts in being a Good Neighbor. 

It is imperative that new, compensatory mitigation fees required 

by BLM or any other Federal agency seeking to get into the business of compensation will not compete with the existing sources of 

voluntary support offered to impacted Alaskan communities. The 

NPRA grant program, required by Federal law, has administered 

over $150 million to the North Slope villages as a result of NPRA 

leasing. Other industry funding sources also exist. 

The Federal agencies should fully understand any potential, unintended consequence that may result from implementing this 

Memo. Due to the history of regulatory challenges, briefly summarized here, we view the Memo as a step in the wrong direction. We 

43 

question the level of consultation the Federal Government undertook prior to its issuance. 

Terms such as ‘‘harmful impacts’’ or ‘‘irreplaceable character’’ are 

left to potentially conflicting interpretation and implementation of 

multiple Federal agencies to determine what these terms mean as 

well as how to best implement policies in order to achieve these 

ambiguous and far reaching goals. 

We urge the Federal agencies to undertake a regulatory cost 

analysis and NEPA review of this proposed, major Federal action 

to help determine commercial and cumulative impacts. A formal 

rulemaking process should be followed. The Federal agencies 

should make expressly clear how non-Federal lands might be impacted. 

Thank you. 

[The prepared statement of Ms. Longan follows:] 

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The CHAIRMAN. Thank you, Ms. Longan. I appreciate your emphasis on the situation within the NPRA, and I will ask you some 

questions about that as well. 

Mr. Lashley, welcome to the Committee. 

STATEMENT OF DOUG LASHLEY, MANAGING MEMBER, 

GREENVEST 

Mr. LASHLEY. Good morning, Chairman Murkowski and Senator 

King and members of this Committee. 

Thank you for your invitation to testify today regarding the Presidential Memorandum issued November 3, entitled, ‘‘Mitigating Impacts on Natural Resources from Development and Encouraging 

Related Private Investment.’’ 

My name is Doug Lashley, and I am the Founder and CEO of 

a small business containing ten employees known as GreenVest. 

We are a private investment influence involving encouraging related private investment which is the subject of this Committee review. 

GreenVest has been around for 22 years. We’re headquartered in 

Annapolis, Maryland. We also have offices in Raleigh, North Carolina and Edison, New Jersey. We primarily do work on the Eastern 

seaboard throughout the Mid-Atlantic region. We are known as an 

environmental mitigation banking firm. 

In just the last three months GreenVest has hired three new peo- ple, we have written contracts for over $18 million worth of new 

mitigation project work and are extremely interested in seeing the 

momentum in good quality, compensatory mitigation continuing. 

Mitigation banking is a key part of the Federal permitting process and the final part of the obligation to avoid, minimize and mitigate in the Federally-recognized mitigation hierarchy to offset 

project impacts. This form of advanced compensatory mitigation 

means that the environmental benefits are achieved before the 

project is permitted. Mitigation bankers restore wetlands and other 

areas with important natural resources. 

Using our own capital, we then seek credits from the Federal 

permitting agencies. These credits can then be purchased by developers, and by developers I mean private, public and individual developer activities. A review of core permit data has shown in the 

last five years that the utilization of mitigation banks verses other 

types of mitigation can reduce the permit processing time significantly. 

The approach used in our industry recognizes the ecosystem values of the watershed, its water, wetlands, habitats, riparian forests 

and provides multiple incentives for restoration and improvement 

of these ecosystem functions. Credit potential is established by restoring and enhancing degraded wetlands, streams, forests and upland habitats which will generate functional uplift to the natural 

systems and provide a means of realizing economic value from the 

properties. 

This is the GreenVest core mission and business. We create credits for transportation agencies, counties, the energy industry and 

the private development community. One hundred percent of the 

work that we do results in permanent conservation easements with 

financial protections assuring long-term durability. 

50 

Our firm welcomed the Presidential Memorandum because it 

provides a framework to achieve efficiency within the various Federal agencies involved in permitting development projects. It’s also 

recognition that the good work that our industry has undertaken 

the last 20 years in helping generate good quality, compensatory 

mitigation is a key factor in helping expedite the restoration of our 

country’s infrastructure. 

With continued coordination from the Administration amongst 

all relevant Federal agencies, we can accelerate permitting in a 

balanced and efficient way by, in part, relying on the use of wetland and ecosystem service banks. 

The work at GreenVest in the Mid Atlantic is helping negate 

some of the negative conditions that exist in our landscape while 

better achieving a balance between economic stability and growth 

within our communities. Integrated economic growth and ecological 

restoration ensures future sustainability in the United States and 

throughout the world. It is clear that in today’s complex financial 

markets economic strategies that involve the restoration and protection of natural resources will succeed and prosper. 

Current regulations provide a framework to generate economic 

value through the protection of these resource values and the development of ecological assets. What is needed is more collaboration between permitting authorities as well as capital from the private sector. An increasing flow of private capital incentivized by 

consistent regulatory environment means more in increasing large 

scale projects. 

We believe implementation of the Presidential Memorandum is a 

great opportunity for agencies that have an impact on the permitting process to find cost savings and efficiencies at a significant 

level. The Presidential Memorandum has already helped generate 

a significant level of interest in continuing to promote the investment of private capital as evidenced by the recent announcements 

about the infusion of both private endowments and Wall Street 

money in the $1 billion range. 

The Department of the Interior has also just announced the establishment of a natural resource investment center to enhance the 

prospect that the private sector will invest in these projects. This 

type of continued involvement and recognition by government that 

the private sector entrepreneurial skills, creativity and bringing 

capital to the table will help address the need to balance economic 

growth with environmental quality and is fundamentally a sound 

policy. 

I appreciate the opportunity to testify today and look forward to 

your questions. 

Thank you. 

[The prepared statement of Mr. Lashley follows:] 

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The CHAIRMAN. Thank you. 

Ms. Scarlett, welcome. 

STATEMENT OF THE HONORABLE LYNN SCARLETT, MANAGING DIRECTOR, PUBLIC POLICY, THE NATURE CONSERVANCY 

Ms. SCARLETT. Thank you very much, Chairman Murkowski and 

Ranking Member Cantwell and members of the entire Committee. 

Thank you for this opportunity to testify. 

I have met with many people on this Committee during my nearly eight-year tenure at the Interior Department in the G.W. Bush 

Administration. During that time, I became familiar with mitigation policies of Interior bureaus. I saw the ways in which effective 

application of policies to avoid, minimize and mitigate impacts 

could support efficient, predictable agency decision-making. 

I’m now Global Managing Director of Public Policy at The Nature 

Conservancy (TNC). Our global focus at TNC is on how to support 

economic development while preventing impacts to the most critical 

lands and waters in a predictable manner. Mitigation done well, we 

believe, can result in positive outcomes for businesses, communities 

and the environment. 

We believe the November 2015 Presidential Memorandum on 

mitigation can support project efficiency and better environmental 

outcomes. These are twin objectives that we share. As others have 

stated today, mitigation is not a new concept in the U.S. policy 

arena, but the track record, as some have noted for efficient project 

review and robust environmental outcomes, could be improved. 

Direct agency rules have stymied private sector projects and investment in restoration. Programs have fallen short of their potential to support good conservation outcomes and more project efficiency. Recognizing these shortcomings, the Bush Administration 

clarified a set of rules on wetlands mitigation. The focus was on 

more clarity and predictability. 

We believe the Presidential Memorandum can actually help affirm these advances. We believe it can enhance consistency across 

the array of agency mitigation policies, where feasible, under existing law. The key emphasis on measurable performance standards 

in the past, lack of clarity and consistency has resulted in inadequate environmental outcomes but has also been bad for project 

developers causing project delays, increased costs and an unpredictable setting for developers. 

We have long believed that these policies needed some common 

sense updates. We have core principles for mitigation policies and 

projects, and we would be happy to share them with you. Among 

these principles is that mitigation decisions should be applied in a 

landscape context, if possible, and use early planning. This approach enables developers to know in advance what areas should 

be avoided or prioritized. This enables more efficient project review 

when project proponents and agencies have clear expectations. 

One good example, as several have mentioned, is the Western 

Solar Plan. That plan supports efficient project review and creates 

clear expectations for mitigation in advance. The approach, we’re 

told, has reduced project permitting time by more than half. 

54 

We think the Presidential Memorandum could build on this type 

of success. Effectively implemented, the Memorandum could yield 

project review efficiencies, reduced Administrative effort, greater 

predictability and certainty for project proponents. Our focus will 

be on the implementation, that is, on the guidance that agencies 

develop under the Memorandum and of course, our long standing 

work in the field, working collaboratively with industry and others 

on advancing mitigation polices. 

We think there’s a potential to lead to better outcomes for the 

environment and communities and, of course, all of this consistent 

with existing law. 

Thank you very much. 

[The prepared statement of Ms. Scarlett follows:] 

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The CHAIRMAN. Thank you. 

Mr. Sims, welcome. 

STATEMENT OF SHAUN SIMS, PRESIDENT, WYOMING ASSOCIATION OF CONSERVATION DISTRICTS, AND MEMBER, WYOMING STOCK GROWERS ASSOCIATION 

Mr. SIMS. Thank you, Chairman Murkowski, Ranking Member 

Cantwell and Committee members. Thank you for the invitation to 

join you today and the opportunity to provide you with my 

thoughts and input on natural resource conservation, mitigation 

and multiple use. 

I’m Shaun Sims, a fifth generation cattle and sheep rancher from 

Uinta County, located in Southwest Wyoming. I’m an elected Supervisor of the Uinta County Conservation District, President of 

the Wyoming Association of Conservation Districts and member of 

the Wyoming Stock Growers Association. I, along with my family, 

raise cattle, sheep and hay. Our family is committed to sound natural resource management, and we practice it every day on our 

ranch. 

As part of our operation, we also host 28 wind turbines subsequently providing for alternative energy development. Our ranch 

operates in four counties, two states and in an area where there 

is active oil and gas development, among many other land uses. We 

also provide world-class mule deer and antelope populations, and 

have large swaths of sage grouse habitat that are considered core 

area, as designated by the State of Wyoming. 

We believe multiple use and conservation of our resources works 

in concert with one another and not independently. We must make 

a living from our resources, and we must take care of our resources 

so that we can make that living. 

I am deeply concerned with the November 3, 2015 Presidential 

Memorandum, ‘‘Mitigating Impacts on Natural Resources from Development and Encouraging Related Private Investments’’ and the 

implications it may have on our family’s ranching operation and 

other industries in my state in the West. The underlying principles 

of avoidance, minimization and compensation are generally sound 

and are already being practiced at the local, state and Federal levels. The document seeks consistency within/across agencies. That 

can have merit; however, as we have seen with the sage grouse 

plans, it can also preclude effective, locally-driven conservation. 

This Memorandum introduces some new concepts that cause me 

concern. First, the Memorandum introduces a new concept of increased private investment and resource restoration and enhancement. My sense is that this will be accomplished through mandatory or mandated compensatory actions not through the encouragement of economic activity that can enable resource users to be willing investors. I have witnessed firsthand what I refer to, and I realize this is a strong word, but frankly in my opinion, it is accurate, 

project approval through coercion. 

Second, the definition of advanced compensation is based on the 

Memorandum and environmental benefits achieved before a 

project’s harmful impacts occur. This language leaves one questioning: whether the intent is to go beyond concurrent mitigation, 

which is current standard for most mitigation projects. Although 

61 

the definition of durability is consistent with current definitions as 

needing to be at least equal to the length of the impact, the document later states that agencies should address the resilience of the 

measures and benefits to potential future environmental change. 

This appears to establish a type of strategy of let’s guess what the 

future holds for resource changes and mitigate for those unknowns. 

Based on the cursory review of the U.S. Fish and Wildlife Service’s proposed revisions, it is obvious mitigation for climate change 

is a major focus. The issue I see with this approach is that there 

are all sorts of dynamics in a natural environment that can change 

the face and condition of a resource base: fire, flood, drought and 

other naturally occurring events. How will anyone ever be able to 

provide mitigation of sufficient durability to account for any potential fire environment—any potential future environmental change 

when we’re talking about a dynamic system that is ever-changing 

itself? 

In addition, the concept of mitigation to provide for a net environmental gain at this point is premature. This approach also assumes that baseline resource information exists at a level to provide certainty on how to get to net gain or no net loss. Although 

there are many efforts aimed at developing these baselines, I am 

not convinced they are sufficient to begin mandating and implementing in the timeframe contemplated by the Memorandum. 

Also, landscape- or watershed-level approaches are discussed in 

the Memorandum. Again, this makes sense from a natural resource 

management perspective; however, I question what size of the 

landscape or the level of the watershed that is being contemplated. 

Lastly, the Memorandum discusses irreplaceable natural resources. I am concerned that this is basically yet one more land 

designation designed to limit our productive use of our resource 

base. There appears to be no shortage of attempts by a designation 

of one sort or another to further limit the ability of farmers and 

ranchers, as well as other industries, to responsibly develop and 

utilize our resources. 

Interpretation of these points is most concerning if left wide 

open, and depending on who is interpreting this, could have a 

chilling effect on future resource development. 

Thank you, Madam Chairwoman and members of the Committee. 

[The prepared statement of Mr. Sims follows:] 

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The CHAIRMAN. Thank you, Mr. Sims. 

Ms. Skaer. 

STATEMENT OF LAURA SKAER, EXECUTIVE DIRECTOR, 

AMERICAN EXPLORATION & MINING ASSOCIATION 

Ms. SKAER. Chairman Murkowski, Ranking Member Cantwell, 

members of the Committee, the American Exploration and Mining 

Association appreciates the opportunity to provide testimony today. 

Before we address the Memorandum, we want to thank you for 

your leadership on critical minerals and much needed permitting 

reform. America has great mineral wealth and our members are 

ready, willing and able to find and produce the minerals America 

requires in an environmentally and socially responsible manner. 

Let me be clear, we support mitigation. Unfortunately, the directives in the Memorandum will unnecessarily create confusion, 

cause delays, increase costs and hinder the ability of America to 

lessen its dependence on foreign sources of strategic and critical 

minerals. 

For more than six years this Administration has sought to 

change the management of our public lands and natural resources 

from Congressionally-mandated multiple use to protection, preservation and soft recreation, while elevating wilderness values above 

wealth and job creating activities like mining, grazing and energy 

production. 

It began with the internal Treasured Landscapes Memorandum 

in 2010, which placed a priority on wilderness preservation and 

creating national monuments, followed by Secretarial Order 3310 

which Congress promptly defunded. 

Fracking rules, co-leasing moratoria, millions of acres of new national monuments without local stakeholder input, massive mineral 

withdrawals including more than ten million acres, ostensibly for 

conserving sage grouse habitat—even though Fish and Wildlife acknowledges that mining is a secondary threat and this Memorandum on mitigation—all designed to prohibit job creation on industries and activities that disturb and degrade the land. 

The Constitution gives Congress, not the Executive Branch, the 

authority to make laws for managing public land. The President’s 

authority is limited to implementing those laws. Congress has enacted a number of land management statutes with a single theme, 

managing for multiple use, sustained yield, while recognizing competing values, protection, preservation, fish and wildlife, outdoor 

recreation, with the need for minerals, energy, food and fiber. 

This Memorandum goes far beyond implementation and is in direct conflict with the Mining Law, the Organic Act, the Federal 

Land Policy and Management Act, and the National Forest Management Act. These acts contain preventative standards such as 

prevent unnecessary or undue degradation or minimize disturbance 

where practicable and feasible. Both recognize there will be necessary and reasonable degradation. 

Unnecessary or undue degradation in minimizing impacts clearly 

authorized onsite mitigation of direct impacts but do not authorize 

or require offsite mitigation, compensatory mitigation, advanced 

mitigation and certainly do not authorize or require net benefit, no 

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able. A directive to avoid is a directive to veto. Congress could have 

adopted these standards but did not and chose to adopt preventative standards. 

While the Memorandum claims no legal effect and purports to 

adhere to existing authorities, it is marching orders from the Chief 

Executive. Agency personnel will feel pressure to comply, which 

will result in uncertainty, project delays, increased costs and perhaps permit extortion where project proponents are pressured to 

provide compensatory mitigation or a net benefit in return for a 

permit. 

Many terms such as important, scarce, sensitive, irreplaceable, 

and net benefit are subjective, vague, ambiguous, undefined and 

untethered to existing statute or regulation. Project proponents will 

face the same dilemma Alice faced in her exchange with Humpty 

Dumpty in Through the Looking Glass, which is to be master. 

That’s all. 

In the Sage Grouse Land Use Plan Amendments without statutory authority, in direct conflict with FLPMA and at the insistence 

of the Fish and Wildlife Service, BLM inappropriately applied a net 

conservation gain or benefit mitigation standard in Sage Grouse 

habitat. This ESA standard was inserted at the last minute and 

was not vetted through the NEPA process. Furthermore, Fish and 

Wildlife has no authority to impose ESA recovery standards with 

respect to an unlisted species. 

Also, without notice and comment and without regard to mineral 

potential, Fish and Wildlife required BLM to withdraw more than 

ten million acres from mineral entry, ostensibly to conserve Sage 

Grouse habitat of irreplaceable character. No analysis of mineral 

potential, no analysis of economic impacts, no analysis of cumulative impacts, and no opportunity for public comment. 

So while the Memorandum purports to respect existing law, the 

Sage Grouse Land Use Plans demonstrate the pressure to comply 

with its directives even when those directives violate existing law. 

It is up to Congress to change mitigation policies and how the public lands are managed, not the Executive Branch. 

Thank you. I look forward to your questions. 

[The prepared statement of Ms. Skaer follows:] 

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The CHAIRMAN. Thank you, Ms. Skaer. 

I am going to yield to Senator Barrasso, and then we will turn 

to Senator King. 

Senator BARRASSO. Thank you very much, Madam Chairman. 

Mr. Sims, you mentioned project approval through coercion. We 

have heard Ms. Skaer talk about permit extortion. You are pretty 

mild compared to the things I heard at the Stock Growers picnic 

and Hall of Fame banquet this year when you were inducted. I 

mean, we were hearing about not just government coercion but, 

you know, government action to compel and in some ways, government action to corrupt because sometimes just trying to comply 

makes it almost illegal in terms of sort of the things that you have 

to do. 

So, I just have a couple of questions with regard to what we are 

seeing here today. I am very pleased that you are here to talk to 

the Committee. In your testimony, you highlighted the importance 

of both multiple use management and conservation in your daily 

life. You have lived that. Your family has lived it in Wyoming. 

If the Federal agencies fundamentally change their management 

mission from multiple use to something that prioritizes avoidance 

over everything else, how is that going to affect your work in the 

Conservation Districts? 

Mr. SIMS. When you develop resources, there is a level of disruption or what you would need to mitigate for. That is what Conservation Districts do best. We try to mitigate for those things, 

make the environment better. But we realize that we need to use 

those resources. That is part of the conservation, we’re going to 

conserve those resources. We’re going to conserve the environment 

that we’re using that hosts those resources. 

The issue I see is we have an avoidance, we have a minimization 

and we have a compensatory hierarchy with this, with the whole 

mitigation thing. I see a jump, a push, to go to the compensatory 

mitigation which does not necessarily benefit that project or that 

area that is being impacted when we’re talking about a landscape 

that could be across the nation or in a Sage Brush Steppe. 

So the avoidance portion of that, I don’t think, allows us to develop those resources and do our jobs. 

Senator BARRASSO. You raise some significant issues about future planning that is going to be required by this Memorandum’s 

mitigation policies. In your view, did the agencies have the ability 

to address all these possible future environmental changes on the 

landscape? 

Mr. SIMS. I do not. I think when they talk about baseline and 

no net loss and the net gain, at this point, there are efforts in the 

State of Wyoming, I know, that will define these and show that 

level of habitats we have or those things, but they are far from 

completed. There’s been a lot of work done on that. 

Senator BARRASSO. You also express concerns with the concept of 

durability and the undue burden that this is going to play on 

projects. 

The Memorandum defines durability loosely saying that the environmental benefits of mitigation must last, it says, at least as long 

as the harmful impacts of the project. This means that at some 

point some agency official can determine how long the harmful efVerDate Nov 24 2008 07:44 May 03, 2017 Jkt 021968 PO 00000 Frm 00080 Fmt 6633 Sfmt 6633 C:\TARSHA\HEARINGS\21968\D21968 D21968
77 

fects of the project will last. It is going to be their speculation. It 

seems possible that ongoing projects could be reexamined under 

these new terms. 

I am wondering if you have heard of any projects that are completed in phases that may be delayed under these new policies? 

Ms. SIMS. Personally I have not. I know that some of the oil and 

gas, as they were developed, and they were continued to go. There 

was one instance where a road was moved from a Sage Grouse lek 

as part of the mitigation for a new portion of that project. 

It’s ironic. They moved the road from the Sage Grouse lek, moved 

it over to another area and the Sage Grouse moved over to where 

the new road was. It was due to the dust in the water, but they 

did try to mitigate for that. But that was a requirement to continue 

another portion of the project. 

Senator BARRASSO. It is amazing. 

Thank you, Madam Chairman. 

The CHAIRMAN. Thank you. 

Senator King. 

Senator KING. Thank you, Madam Chair. 

It seems to me this is an interesting hearing and discussion because this core question is, is this Memorandum regulatory or 

wreckatory? Is it advice to the agencies or does it create additional 

regulatory burdens? Certainly whoever helped the President with 

the drafting knew what they were doing legally because there are 

all kinds of statements at the end that says this does not increase 

authority, this does not expand existing regulation, it is simply advice to the agencies. 

Ms. Longan, if it is non-regulatory, isn’t consistency, timeliness 

and predictability across Federal agencies a good thing? I have 

been working in regulatory affairs for 35 years, and I have always 

thought that was something that we wanted. My question is what 

new imposition does this Memorandum place upon the development process in Alaska or anywhere else? 

Ms. LONGAN. Thank you for the question. 

Yes, consistency and coordination among the Federal agencies 

that are operating under multiple or different authorities is always 

a good thing. 

What I should underscore is that in Alaska the predominant 

form and legal authority to require compensatory mitigation comes 

from the Clean Water Act as well as from the Endangered Species 

Act. There are several other Federal agencies listed in this Memorandum that aren’t currently requiring any form of compensatory 

mitigation. To that end, then, that is striking the developers in 

Alaska as something incredibly new and in addition to what is already required in our state. 

Senator KING. Well, it says right in it, this Memorandum is not 

intended to, and does not, create any right or benefits substantive 

of procedural, enforceable at law and equity by any party against 

the United States, etcetera. Nothing in this Memorandum shall be 

construed to impair or otherwise effect the authority granted by 

law to an Executive department. 

It is called the Administration for a reason. They are supposed 

to administer the laws. That is part of implementation. I am having a hard time figuring out how this imposes new burdens. It 

78 

seems to me that is the core question that we are discussing here 

today. 

You had eloquent testimony on this. Give me your thoughts, 

please? 

Ms. SKAER. Well Senator, you have the Chief Executive issuing 

a Memorandum saying the word shall in it, you know? This is what 

we shall do, yet, the agencies all operate under different statutes 

that have different goals. Congress provided different standards for 

how you manage the public lands whether there is mitigation or 

not. 

Senator KING. But isn’t what the President is saying, he is clearly qualified. It says—— 

Ms. SKAER. Yes, it does. 

Senator KING. As you are—to be consistent with Federal law, in 

so far as you are consistent, try to be—— 

Ms. SKAER. Okay. 

Senator KING. Try to have the same rules for all these different 

agencies. Is that not a benefit to your—— 

Ms. SKAER. Well, except that you have different goals and different rules and different mitigation standards depending on 

whether it’s a listed species under the Endangered Species Act or 

you’re developing a mine or an energy project. 

In the Sage Grouse Land Use Plans, there are six lawsuits now 

so the administrative record has been filed with the courts. We see 

great pressure from Fish and Wildlife, BLM, to adopt the net benefit recovery standard, and BLM saying that violates our statute. 

We can’t do that under FLPMA. It prevents unnecessary undue 

degradation and Fish is saying if you want ‘‘not listed, not warranted,’’ you will do this. 

And so—— 

Senator KING. Right. 

Ms. SKAER. You know, it’s clear that the statute provided one set 

of rules but the agencies were pushing in a different direction. 

Senator KING. I have had the experience of having OSHA telling 

me my bulldozers had to have backup noise, backup signals and 

the Department of Environmental Protection saying no, that is a 

violation of the noise standard. So my suggestion was you guys go 

in a room and work this out, but I understand how you can have 

inconsistencies. 

Ms. Scarlett, several strong words have been used and I think 

the words were extortion and pressure. What about the danger of 

advanced mitigation being used as a, kind of, pressure point. If you 

provide enough advanced mitigation, we will expedite or I do not 

think it would be that explicit? But human nature being what it 

is, address that concern that has been expressed here? 

Ms. SCARLETT. Thank you very much. 

At The Nature Conservancy, we see two dimensions of the mitigation policy as important and as going in tandem. One is the large 

landscape planning and advanced mitigation opportunities where 

applicable under the law. The other is more clearly stating goals. 

In the context of clearly stated goals, that is what it is, what impacts you are striving to mitigate against, that allows the focus 

then to be on addressing those. That’s quite a different process 

than one where you have no clear goals and therefore you get into 

79 

simply a negotiation. Well, $8 million sounds good, $6 million 

sounds good, so we think those things together actually can advance good outcomes. 

I want to point to one example which will help us understand 

that. It predates, of course, this Memorandum, but it is the San 

Diego Association of Governments, 18 governments, lots of development in the area, transportation systems and so forth. They did a 

large landscape effort, advanced mitigation effort, so that they 

would be able to expedite transportation projects over many, many 

years. The effect of that has probably been to have development 

costs and also significantly reduce the timing. We think that’s a 

best practice, and we think it’s one consistent with what this is 

striving to do but striving to get all the agencies to more consistently apply that kind of approach. 

Senator KING. It seems to me the consistency, timeliness and 

predictability are virtues. The question is whether this Memorandum achieves that, but that seems to be the goal. 

Thank you, Madam Chair. 

The CHAIRMAN. Thank you, Senator King. I so appreciate the fact 

that you come, you listen, you ask these very probing questions. I 

think the goal is admirable, absolutely. I think you said it was salutary, and I would agree. I am just trying to understand whether 

or not this gets us there or not, so I appreciate your line of questioning. 

Ms. Longan, I want to go back to you with regards to what we 

saw within the NPRA and the effort to align the mitigation interests between BLM and the Army Corps of Engineers within the 

NPRA. And again to try to drill down to see if, in fact, this Memorandum really gets us any closer because I think what we saw with 

the experience within the NPRA that the compensation requirement was $8 million. Ms. Scarlett, you said, in your example, $8 

million right? Is $6 million right? 

It was certainly my sense all throughout that when it came to 

that requirement that they were putting in front of Conoco, when 

it came to the compensation, it was what could they land on that 

Conoco would finally agree to? 

One of the questions that I am asking Mr. Bean for on the record, was exactly how was that $8 million payment developed? 

What were the metrics that were used in determining exactly what 

that compensation would be, because as of this point in time, I 

have yet to be shown anything that would give clarity to anybody 

who is looking to do a project up there in terms of what metrics 

we are using? Do you have any clear sense as to how that $8 million in compensation was calculated or determined, or again, the 

metrics that were in place then? 

Ms. LONGAN. No, it’s not clear to the state, and we actually 

worked to serve BLM as a cooperating agency during the NEPA review for GMT–1. We do not know which metrics or parameters 

were used for BLM to derive the $8 million mitigation cost. 

I want to take a moment to just recognize BLM Alaska’s attempts to increase in transparency since they issued the decision 

for GMT–1. They recognize that perhaps they could have done a 

better job. BLM is holding workshops throughout the state seeking 

input from the communities and from the public to help BLM deVerDate Nov 24 2008 07:44 May 03, 2017 Jkt 021968 PO 00000 Frm 00083 Fmt 6633 Sfmt 6633 C:\TARSHA\HEARINGS\21968\D21968 D21968
80 

termine how best to now use those $8 million to effectively mitigate 

impacts. 

It’s important to realize that BLM cannot consistently follow 

metrics or parameters to estimate mitigation costs because those 

metrics are not in place in any regulation or well established policy, so it is unlikely, if not improbable, that BLM can be consistent 

in applying any metric that does not exist. 

The CHAIRMAN. So, it is throwing the dart at the board and seeing where it lands as this point in time? Is it that random? 

Ms. LONGAN. Our sense was that yes, it was that random, and 

there was a bit of a push and a rush to determine these mitigation 

costs, again, because I’m hearing about mitigation in advance. 

Well, in advance is a relative term. Anecdotally and in my observation, the mitigation is always, typically, in advance and needs to 

be established, if not occurring, before a permit is issued. 

So in the case of GMT–1, BLM was under pressure as was the 

applicant to make decisions and issue the permits and authorizations under BLM authority, and mitigation certainly was, sort of, 

a last minute decision yet to be made. 

The CHAIRMAN. It sounds like it fits into what was said earlier, 

permit through coercion. Then the fact that BLM is now using 

some of that $8 million to develop its landscape level, regional mitigation strategy. So in effect, what you have is the private party, 

Conoco, bearing the burden of paying for BLM to develop its regional mitigation strategy. I do not know if that is unprecedented, 

but it certainly is unusual. 

I asked the question of Mr. Bean earlier when he was saying 

that the whole purpose of this Memorandum is to get to that point 

where it is expedited. It helps to reduce overall costs. It provides 

greater certainty. I suggested to him that I was searching in my 

head to try to think of an example, at least in our state, where we 

have seen the process made better because of this coordination/collaboration. I couldn’t come up with anything. Can you share anything with the Committee here? 

Ms. LONGAN. Sure, I will try. 

In terms of coordinating the NEPA review and regulatory outcomes, GMT–1 comes close to being a good example, Senator. What 

was unfortunate in that is, again, there were multiple Federal 

agencies needing to issue permits and authorization. Really at the 

helm of that was BLM as well as the Corps of Engineers who has 

to issue 404 permits. As I stated in my oral testimony, that is a 

requirement almost all the time because Alaska, as you’re very familiar, is so covered in wetlands. 

So the government agencies back home in Alaska are trying very 

hard to collaborate and coordinate, and I am seeing impressive 

areas of improvement there. But herein we have the problem of unknown, unexpected and unclear guidelines or non-existing guidelines that require Conoco to pay for compensatory mitigation. The 

mitigation required for GMT–1, again, was in addition to what 

Conoco was very used to paying under the Clean Water Act. So the 

policies that BLM is still working to develop are very new to us in 

Alaska, and it’s, sort of, policy on paper so it’s hard for developers 

or even the State of Alaska to understand the process, and to unVerDate Nov 24 2008 07:44 May 03, 2017 Jkt 021968 PO 00000 Frm 00084 Fmt 6633 Sfmt 6633 C:\TARSHA\HEARINGS\21968\D21968 D21968
81 

derstand exactly what mechanism is used to determine compensatory mitigation costs. 

The CHAIRMAN. Fair enough. 

Let me ask about the one recommendation in your letter here 

that asks that it be made clear how new Federal mitigation policies 

might impact our non-Federal lands, specifically state, private, Native corporation or tribal lands. What is your concern there? 

Ms. LONGAN. Thank you for the question. 

We have a strong concern that the Memo does not seem to provide guidance on how non-Federal lands might be impacted. We 

understand that this Memo is set forth to establish mitigation 

goals which we strongly support; however, we also understand that 

the decision-making is delegated to the Federal agencies. 

Multiple Federal agencies are listed in this Memorandum. They 

are responsible for making those decisions, implementing policy 

where regulations do not exist and they are the ones who will then 

require how or if compensatory mitigation will impact state, Native 

corporation, tribal or private lands. 

This is concerning to us. We are expecting that existing local and 

state authorities will not be marginalized by any new mitigation 

policy or outcome based on the issuance of this Memorandum. 

The CHAIRMAN. I recall a conversation that I had with a tribal 

member down in Southeastern Alaska who is concerned about 

some of the mitigation requirements, and in their community with 

their tribal lands, the concern was the mitigation costs could actually be more than the cost of their overall project. This was a small, 

small tribal organization. So it is something, again, where there is 

certainly a lack of clarity here. 

Let me ask Ms. Longan, Mr. Sims and Ms. Skaer, you have suggested that some of the definitions are troubling. I, in my comments to the agency witness, indicated that there was lack of clarity within agencies whether it was best available science. 

Mr. Sims, you have mentioned the same concern shared by Senator Barrasso about how we define irreplaceable natural resources. 

In terms of those troubling definitions contained within this Memorandum, what gives you the most pause or cause for concern? 

Ms. Skaer, you want to go? 

Ms. SKAER. The avoid irreplaceable resources or resources of irreplaceable character, you know, mineral deposits, economic mineral 

deposits are rare and they’re hard to find and they are where God 

put them. And sometimes God put them where there were some 

other resources of value. You can’t avoid those if you’re going to develop the minerals that America needs. So that seems to be one of 

those things that is in the eye of the beholder. What’s irreplaceable 

to me may not be irreplaceable to you. 

The other one is the net benefit or net conservation gain. How 

do we measure that? Is it two to one? Five to one? Ten to one? A 

hundred to one, you know? And what are the parameters for that? 

You know, there’s so many of these definitions. They’re not tied or 

tethered to existing statute or regulation where the agency can 

look at their regulations and say ‘‘okay, we defined mitigation to 

mean . . . ’’ These are terms that are very subjective. 

The CHAIRMAN. Mr. Sims. 

Mr. SIMS. I would echo my panelist’s comment on that. 

82 

The other thing, the durability, say you have a project and you’ve 

done everything you can think of. You’ve put in some compensatory 

mitigation and your project lasts 30 years or 50 years, and down 

the road it becomes evident that maybe what you did was not 

enough or it was but you did it in a full faith effort and you’ve expended those resources. 

Mitigation, generally, if it’s not compensatory, costs money or it’s 

a change in design or it’s a change in the way you put it on the 

ground. So there’s all sorts of that mitigation, and now are these 

agencies going to be able to come back and say no, you need to 

change this or you need to add to this so the durability of your 

mitigation can continue on for the life of the project? 

That unknown, that—how do you plan for that far ahead in a 

habitat or for a species conservation is very difficult to do. 

The CHAIRMAN. Ms. Longan. 

Ms. LONGAN. Thank you. 

I also echo the comments from my fellow panel members. The 

term irreplaceable natural resources or resources that have an irreplaceable character is certainly most concerning to us. And it’s not 

the simplicity in actually defining these terms. That seems easy 

enough. The complexity comes with then multiple Federal agencies, 

again operating under multiple authorities that aren’t consistent, 

actually having to implement their policies in order to achieve that 

very ambiguous and vague term of not impacting resources with an 

irreplaceable character. 

Harmful impacts is extremely subjective and vague to us also. 

What hasn’t been clearly stated is how the goals set forth to minimize harmful impacts may or may not interact or coincide with existing Federal laws and definitions, how it may or may not coincide 

or interact with existing mitigation requirements. For example, the 

outcomes from the NEPA process that obviously is going to work 

to avoid, minimize and mitigate harmful impacts or a definition 

close to that term. It is not expressly clear how these new mitigation goals, again, will coincide or interact with multiple Federal 

laws that already require mitigation. 

The CHAIRMAN. Let me ask you, Mr. Lashley, about the issue 

that Mr. Sims has brought up about the durability requirement. 

What impact might this have on the work that you do, how the 

banking community might assess the risk and effectively assign a 

dollar value to a bank’s risk of assuming liability for the durability 

of a project’s mitigation efforts in perpetuity while also at the same 

time ensuring the mitigation measures are durable in light of unknown potential, future environmental issues? So you have got an 

uncertainty out there. How do you bank that or is that an issue 

for you yet? 

Mr. LASHLEY. Thank you, Madam Chairman, for the opportunity 

to answer that question. 

First, I applaud Mr. Sims for the work that he’s doing in Wyoming. It’s admirable, and I say that because it illustrates the complexity of having uniform standards. What’s good for the hydrology, 

the soils, the habitat, all of the ecosystem values that exist in Wyoming are completely different than in Alaska or Florida or Maine 

or Nevada. 

83 

And when it comes to durability and banking it is built into the 

existing law. So the use of the word durability, it’s an adjective. It 

describes the fact that under almost all banking guidelines that 

exist today and some are still evolving, but under all banking 

guidelines that we work in affect water quality. So reduction of nutrients, protection of streams, protection and restoration of wetlands, in addition to forestry banking guidelines under most state 

rules, have a durability component. 

We have to maintain and monitor the projects in order to secure 

credits. Our credits are released over a period of from five to ten 

years, I’m sorry, two to ten years, so our average bank project is 

a ten-year process. 

We have financial assurances and bonds to make sure that corrective action is taken. If we don’t take that corrective action to 

solve a climatic issue, a weather-related issue, then our credits are 

withdrawn from our ledger and they can’t be used to offset new impacts. 

At the end of the regulatory release of our projects, and keep in 

mind there’s a permanent conservation easement on all the acreage 

that’s within the bank domain, that the work that we’re doing, we 

have to provide long-term, the word perpetual is used and nobody 

really can understand what perpetual is, although it means a very 

long time. We have to provide a fund that is handed over to a longterm steward, usually a non-profit, a river keeper, a bay keeper, 

and they have to maintain the site in perpetuity. 

So durability is not new based on our interpretation of the Presidential Memorandum, it’s something that we assume right now 

and build into our projects. 

The CHAIRMAN. Ms. Scarlett, I think this will be my last question 

here this afternoon. I appreciate the staying power of this panel 

here. 

When we talk about collaboration and coordination, in my mind, 

the better results come when you truly have all the stakeholders 

involved and engaged and a level of coordination with the state and 

the local entities. Western Governors Association has sent multiple 

letters to the Department of the Interior pushing this and given 

your background, your government service and in your current 

role, I would think that you probably agree that it only makes 

sense to have all stakeholders engaged here. But as I read it, the 

Presidential Memorandum is silent with respect to collaboration 

and engagement with states and local governments and private 

sector stakeholders, and only contains a kind of passing reference 

to that. 

How would you recommend that we can ensure that Federal 

agencies really are collaborating and coordinating and engaging on 

mitigation with all of the stakeholders and really pulling in the 

states? If Ms. Longan, in her capacity in the Department of Natural Resources, is not involved in this process, it seems to me 

you’ve got a real deficiency and you have a process then, effectively, 

that does not work whether it is in Alaska, whether it is in Wyoming or elsewhere? How do we correct this, because in my view it 

is an error of omission. I hope it is not purposeful, but it is clearly 

not there now. What is your advice here? 

Ms. SCARLETT. Yeah, thank you very much, Senator. 

84 

Collaboration is a hallmark of what The Nature Conservancy is 

all about. Everywhere we work that is the approach that we utilize. 

And as you may recall during my tenure at the Department of the 

Interior, a central tenant was cooperative conservation. Indeed, we 

put out or worked to have the President put out an Executive 

Order on cooperative conservations. So clearly that is critical. 

I think for our attention at The Nature Conservancy on the 

Memorandum and, as you noted, there are some salutary 

underpinnings, that is trying to enhance project efficiency and at 

the same time also enhance environmental outcomes. The key, 

really, is going to be in the agencies and their follow on. The 

Memorandum is asking the agencies to actually develop follow on 

policy guidance. 

So we intend to participate through the public comment process 

to ensure that guidance both provides some of the clarity that has 

been discussed here with respect to terminology but also is inclusive of the importance of stakeholder engagement and so on and so 

forth. So both in the follow on guidance that will be promulgated 

by the agencies and then of course, in the on the ground practices, 

we remain vigilant about the inclusion of stakeholder engagement. 

The CHAIRMAN. I think we have heard good praise, high praise, 

for what is going on in the State of Wyoming. Certainly in Alaska, 

because we are so distinct and oftentimes our issues are just that 

much bigger or more complicated, I think it is important that we 

look to the states as well in terms of how they have been handling 

the issue of mitigation and have been for a long time, and obviously being good stewards in so many cases. 

Again, I worry about those in Washington, DC sitting here as 

Federal agencies basically telling you in the West or us in the 

North how it is going to be. That is not a very collaborative process. I would certainly encourage that as we are working through 

many of the issues that have been raised, not only here in this 

Committee but in discussions around the country, that the best 

practices that we have seen in many of our states are looked to for 

a level of guidance. 

I appreciate the input of all of you here this morning and know 

that we will await a response to the letter that 19 of us have 

signed to the Administration asking for greater clarity here. I am 

sure that there will be more questions for the record that will be 

submitted by my colleagues. 

This is an issue that, particularly for us in the Western states, 

is as significant as anything because if the opportunity to develop, 

whether it is a coal lease, whether it is grazing lands, whether it 

is an opportunity to access our oil resources up North or whether 

it is putting in a new runway, if there is not some clarity and 

again, some general understanding as to how you proceed before 

you put your pen to paper, it is a great way to shut down just 

about everything. 

My hope is that what we will see is greater certainty that allows 

our states, our tribes and our private entities a path forward that 

is reasonable. Because right now, what we are seeing is a lot of 

frustration and a lot of just real consternation about the practices 

that are being advanced back here from our Federal agencies. 

85 

I will end with Senator King’s words that the goals are laudatory 

or salutary, I think, was his description. Getting there is our challenge, and right now we are clearly not there yet. So we have got 

a ways to go. 

With that, I thank you all and appreciate you being here. 

[Whereupon, at 12:23 p.m. the hearing was adjourned.] 

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