I 

108TH CONGRESS 

1ST SESSION H. R. 2531

To amend the Federal Water Pollution Control Act relating to wetlands 

mitigation banking, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 19, 2003

Mr. JONES of North Carolina (for himself, Mr. TAUZIN, Mr. BRADY of Texas, 

Mr. OTTER, Mr. PICKERING, Mr. TAYLOR of Mississippi, and Mr. 

BAKER) introduced the following bill; which was referred to the Committee on Transportation and Infrastructure 

A BILL

To amend the Federal Water Pollution Control Act relating 

to wetlands mitigation banking, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘American Wetland 

5 Restoration Act’’. 

6 SEC. 2. DECLARATION OF POLICIES AND GOALS. 

7 Section 101(a) of the Federal Water Pollution Con8 trol Act (33 U.S.C. 1251(a)) is amended—
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1 (1) by striking ‘‘and’’ at the end of paragraph 

2 (6); 

3 (2) by striking the period at the end of para4 graph (7) and inserting a semicolon; and 

5 (3) by adding at the end the following: 

6 ‘‘(8) it is the national policy to conserve, create, 

7 and restore wetlands so as to increase the quantity 

8 and quality of the wetlands resource base of the con9 tiguous United States and to meet the interim goal 

10 of no overall net loss for the remaining wetlands re11 source base of the contiguous United States while 

12 taking into account the status and trends of the wet13 lands resource base in particular regions and area 

14 and to achieve such goals through regulatory means 

15 that take into account that 75 percent of the wet16 lands in the contiguous United States are privately 

17 owned and that private property rights should not be 

18 unreasonably infringed and through nonregulatory 

19 opportunities involving all levels of government and 

20 supported by private initiatives; and 

21 ‘‘(9) it is the national policy to foster wetlands 

22 mitigation banking as a means to mitigate the un23 avoidable loss of wetlands and to do so by providing 

24 a regulatory framework for the establishment, oper25 ation, and use of mitigation banks, making appro-
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1 priate use of existing, successful programs for miti2 gation banking, and taking into account regional 

3 variations in wetlands conditions, functions, and val4 ues.’’. 

5 SEC. 3. USE OF MITIGATION BANKS. 

6 Section 404 of the Federal Water Pollution Control 

7 Act (33 U.S.C. 1344) is amended by adding at the end 

8 the following: 

9 ‘‘(u) USE OF MITIGATION BANKS.—

10 ‘‘(1) DEFINITIONS CONTAINED IN FEDERAL

11 GUIDANCE.—Except as otherwise provided in this 

12 subsection, a term used in this subsection shall have 

13 the meaning given such term in the Federal Guid14 ance. 

15 ‘‘(2) OTHER DEFINITIONS.—In this subsection, 

16 the following definitions apply: 

17 ‘‘(A) CHARTER.—The term ‘charter’ 

18 means a mitigation banking instrument, as de19 scribed in the Federal Guidance. A charter is 

20 an agreement between an applicant for a char21 ter and the Secretary or a State (in the case of 

22 a State administering a program under sub23 section (h)(2)(A)) that has been developed in 

24 consultation with the mitigation bank review 

25 team. 
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1 ‘‘(B) FEDERAL GUIDANCE.—The term 

2 ‘Federal Guidance’ means the Federal Guidance 

3 for the Establishment, Use and Operation of 

4 Mitigation Banks (60 Fed. Reg. 58695 (No5 vember 28, 1995)). 

6 ‘‘(C) MAINTENANCE.—With respect to 

7 wetlands, the term ‘maintenance’ means an ac8 tivity undertaken to ensure viability of a wet9 land or to ensure the accomplishment of a 

10 project goal after a wetland restoration, en11 hancement, creation, or preservation project has 

12 been completed, including hydrological manipu13 lation and control of desirable and undesirable 

14 plant species. 

15 ‘‘(D) MITIGATION BANK.—The term ‘miti16 gation bank’ means a specified wetland resource 

17 restoration, creation, or enhancement project or 

18 projects (which may include the preservation of 

19 appurtenant wetlands, uplands, or open water 

20 resources to the extent that the wetlands, up21 lands, or open water resources increase the eco22 logical functioning of the mitigation bank) or, 

23 in exceptional circumstances, a project or

24 projects consisting solely of preservation of wet25 lands that has been chartered by the Secretary
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1 under this subsection for the purpose of pro2 viding mitigation credits to offset wetland losses 

3 authorized by the terms of permits allowing ac4 tivities in the waters of the United States. 

5 ‘‘(E) SERVICE AREA.—The term ‘service 

6 area’ means the designated area, as described 

7 in the Federal Guidance, in which a mitigation 

8 bank may provide compensatory mitigation for 

9 impacts to wetlands resources. 

10 ‘‘(F) WETLAND FUNCTION.—The term 

11 ‘wetland function’ means an environmental, 

12 hydrological, or other role that the wetland 

13 serves, including flood water storage, flood 

14 water conveyance, ground water discharge or 

15 recharge, erosion control, wave attenuation, 

16 water quality protection, scenic and aesthetic 

17 use, food chain support, fisheries, wetland plant 

18 habitat, aquatic habitat, and habitat for wet19 land-dependent wildlife. 

20 ‘‘(3) CHARTER OF MITIGATION BANKS.—

21 ‘‘(A) ISSUANCE.—The Secretary, in con22 sultation with the mitigation bank review team, 

23 may issue a mitigation bank charter to a person

24 who, with respect to the project or projects that 
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1 are to be included in the scope of the mitigation 

2 banking charter, meets the following criteria: 

3 ‘‘(i) Provides reasonable assurances of 

4 success of the proposed restoration, en5 hancement, creation, or preservation 

6 project. 

7 ‘‘(ii) Demonstrates an adequate 

8 source of water to support the wetland. 

9 ‘‘(iii) Demonstrates adequate legal 

10 control, such as title, license, contract, or 

11 option (contingent upon approval of the 

12 charter), over the real property (including 

13 necessary uplands, as appropriate) in the 

14 proposed project to carry out the proposed 

15 project. 

16 ‘‘(iv) Demonstrates adequate financial 

17 assurances to carry out the proposed 

18 project, including the design, operations, 

19 and maintenance plan and remedial meas20 ures. Such financial assurances may be in 

21 the form of performance bonds, irrevocable 

22 trusts, escrow accounts, casualty insur23 ance, letters of credit, legislatively-enacted 

24 dedicated funds for government operated 

25 banks, or other approved instruments. 
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1 Such financial assurances shall entitle the 

2 Secretary to draw upon the assurances in 

3 the event of a substantial failure to per4 form the work provided in the mitigation 

5 bank charter, or a substantial failure of 

6 the mitigation bank to perform as expected 

7 in the application, in any case in which 

8 mitigation credits based on such work have 

9 already been used or sold. Such financial 

10 assurances shall be in place prior to the 

11 withdrawal of credits. 

12 ‘‘(v) Demonstrates an adequate de13 sign, operations, and maintenance plan to 

14 ensure continued viability of the proposed 

15 project after completion of construction of 

16 the project. 

17 ‘‘(vi) Demonstrates adequate legal 

18 protection, such as easements, covenants 

19 running with the land, or other appro20 priate, legally binding undertakings, to en21 sure permanent protection of the wetlands 

22 in the mitigation bank that are used as the 

23 basis for selling credits. Such legal protec24 tions shall be in place at the time that the 

25 credits are withdrawn. 
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1 ‘‘(B) APPLICATION AND PROCEDURE.—An 

2 applicant for a mitigation bank charter shall 

3 submit to the Secretary an application and sup4 porting materials signed by a responsible offi5 cial acting on behalf of the applicant certifying 

6 the accuracy of the information contained in 

7 the application and materials. The application 

8 shall include, at a minimum, information on the 

9 criteria contained in subparagraph (A). The 

10 Secretary shall advise the applicant, not later 

11 than 30 days after the date of filing, of whether 

12 the application is complete and advise the appli13 cant, in writing at that time, of any additional 

14 materials that must be submitted in order to 

15 complete the application. The Secretary shall 

16 also transmit a copy of the complete charter ap17 plication to the affected State, and to the heads 

18 of appropriate Federal agencies, each of which 

19 shall have 60 days, to run concurrently, to file 

20 written comments, which shall be part of the 

21 record. If no comments are filed before the last 

22 day of such 60-day period, the Secretary may

23 presume that the entities do not object to the 

24 charter. 
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1 ‘‘(C) MITIGATION BANK REVIEW TEAM.—

2 The mitigation bank review team, as defined in 

3 the Federal Guidance, shall be responsible for 

4 reviewing charter applications, reaching con5 sensus on the terms of the charter, and coordi6 nating, as necessary, to ensure effective imple7 mentation of the terms of the charter. The Sec8 retary or the State (in the case of a State ad9 ministering a program under subsection 

10 (h)(2)(A)) shall be the chair of the mitigation 

11 bank review team and have the responsibility 

12 for making final decisions regarding the terms 

13 of the charter if consensus cannot be reached 

14 within the timeframes provided by this sub15 section. 

16 ‘‘(D) COORDINATION.—To the extent pos17 sible, the Secretary shall coordinate the proc18 essing of a mitigation bank charter application 

19 under this subsection with the processing of ap20 plications by such applicant for other permits 

21 required under this section, in order that deter22 minations with respect to such permits may be 

23 made concurrently with the final decision on the 

24 bank charter. 

25 ‘‘(E) NOTICE.—
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1 ‘‘(i) PUBLICATION.—The Secretary 

2 shall publish notice of the charter applica3 tion in the Federal Register and in a news4 paper of general circulation in the pro5 posed service area in which the mitigation 

6 bank is to operate (including the county in 

7 which the project is to be located), and 

8 shall make copies of the charter application 

9 and supporting materials available for pub10 lic review at appropriate convenient loca11 tions in the service area. 

12 ‘‘(ii) CONTENTS.—The notice shall de13 scribe the project or projects provided in 

14 the charter application, explain where sup15 porting materials may be reviewed, and 

16 provide 30 days for the submission of com17 ments on the compliance of the proposed 

18 application in accordance with this sub19 section. Upon request, the time for com20 ment may be extended once for 30 days. 

21 ‘‘(iii) PERMIT REQUIREMENTS.—In 

22 any case in which a permit is required

23 under this section to construct a mitigation 

24 bank, the notice and opportunity for public 

25 comment provided in accordance with the 
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1 application for the permit may satisfy the 

2 requirements of this paragraph for public 

3 notice and comment. 

4 ‘‘(F) DECISION DEADLINE.—The Sec5 retary, in consultation with the mitigation bank 

6 review team, shall decide whether to issue a 

7 mitigation banking charter not later than 90 

8 days after the date of filing of a completed 

9 charter application. 

10 ‘‘(G) EXTENSION OF DEADLINE.—If addi11 tional time is needed to file comments, to pro12 vide for a hearing, to provide for further review 

13 of comments, or to provide for a reply to ad14 verse comments, the Secretary may extend the 

15 time for review once for 90 days. 

16 ‘‘(H) DETERMINATION.—After a review of 

17 public comments and any reply by the appli18 cant, the Secretary may, in accordance with 

19 subparagraph (A) and after appropriate coordi20 nation and consultation, issue the charter, deny 

21 the charter, or issue the charter with modifica22 tions. The Secretary’s decision shall be based 

23 on the entire public record. 

24 ‘‘(I) AMENDMENTS.—Additional projects 

25 may be added to a mitigation bank charter by 
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1 amendment. Amendment applications shall be 

2 processed in the same manner as charter appli3 cations, but the Secretary may treat the facts 

4 established in support of the charter and con5 firmed by the most recent report required under 

6 subparagraph (J) as established for the purpose 

7 of the amendment application process. 

8 ‘‘(J) PERIODIC REPORTS.—Persons hold9 ing a mitigation bank charter shall report to 

10 the Secretary in accordance with the charter 

11 and on a periodic basis, as determined by the 

12 Secretary. The report shall include—

13 ‘‘(i) information demonstrating the 

14 success of the proposed restoration, en15 hancement, creation, or preservation 

16 project; 

17 ‘‘(ii) a demonstration of a continued 

18 compliance with financial assurance re19 quirements;

20 ‘‘(iii) a demonstration of a continued, 

21 adequate, long-term source of water to 

22 support the wetland; 

23 ‘‘(iv) a progress report in accom24 plishing the construction and design, oper-
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1 ations, and maintenance plan provided in 

2 the charter; 

3 ‘‘(v) a reconciliation of the number of 

4 credits sold during the previous years, the 

5 number of credits remaining, and any 

6 change in the number of credits made in 

7 accordance with the requirements of this 

8 subsection; and 

9 ‘‘(vi) any other reporting requirement 

10 defined in the charter. 

11 ‘‘(K) RESPONSIBILITY FOR BANK SUC12 CESS.—Subject to the terms of the charter, a 

13 person holding the charter shall be responsible 

14 for ensuring the success of the restoration, cre15 ation, enhancement, and preservation activities. 

16 ‘‘(L) REVOCATION.—A mitigation banking 

17 charter—

18 ‘‘(i) shall be revoked by the Sec19 retary—

20 ‘‘(I) for a criminal conviction for 

21 making material false statements in 

22 the charter application or annual re23 port; and 

24 ‘‘(II) for substantial violations of 

25 law (other than violations described in
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1 clause (I)) that demonstrate the 

2 unfitness of the holder of the charter 

3 to operate the mitigation bank; and 

4 ‘‘(ii) may be revoked by the Sec5 retary—

6 ‘‘(I) for a substantial failure of 

7 the bank to perform as expected in 

8 the charter; and 

9 ‘‘(II) for a substantial failure to 

10 comply with the terms of the charter, 

11 including financial assurances or crit12 ical operating requirements. 

13 The charter may be revoked only after an op14 portunity for a public hearing. 

15 ‘‘(M) STANDARDS AND CRITERIA FOR SUC16 CESS.—The Secretary, in consultation with the 

17 Administrator, shall establish standards and 

18 criteria for the success of mitigation banks 

19 under this subsection. 

20 ‘‘(4) CREDITS AND DEBITS.—

21 ‘‘(A) NUMBER OF CREDITS.—The number 

22 of credits to which a chartered mitigation bank 

23 is entitled for wetlands restoration, enhance24 ment, and creation shall be based on the meth25 odology contained in the charter, consistent 
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1 with the approach identified in the Federal 

2 Guidance. Limited credits may be granted, con3 sistent with the Federal Guidance, for the in4 clusion of uplands, open water, and preserved 

5 wetlands areas within a bank if the uplands, 

6 open water, and preserved wetlands areas with7 in the bank increase the overall ecological func8 tioning of the bank. 

9 ‘‘(B) CREDITS BASED SOLELY ON PRESER10 VATION.—The number of credits that are based 

11 solely on preservation should be based on the 

12 functions that would otherwise be lost or de13 graded if the wetlands were not preserved, and 

14 the timing of such loss or degradation, pursu15 ant to the Federal Guidance. In any case in 

16 which the Secretary determines that preserva17 tion of wetlands is appropriate as the sole basis 

18 for providing mitigation credits, the Secretary 

19 shall make a determination that the wetlands—

20 ‘‘(i) perform physical or biological 

21 functions, the preservation of which is im22 portant to the region in which the wetlands 

23 are located; and 

24 ‘‘(ii) are under a demonstrable threat 

25 of loss or substantial degradation due to 
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1 activities that might not otherwise be ex2 pected to be restricted and that are not the 

3 consequence of actions under the control of 

4 the bank sponsor. 

5 ‘‘(C) OFFERING CREDITS FOR SALE.—

6 Upon receipt of its charter, a mitigation bank 

7 may offer mitigation credits for sale in accord8 ance with the charter. The number of credits 

9 that a mitigation bank may offer for sale shall 

10 not exceed the number to which the bank is en11 titled under the charter. As specifically ap12 proved under the charter, and consistent with 

13 the Federal Guidance, limited credits may be 

14 sold before restoration, enhancement, or cre15 ation activities have begun if adequate financial 

16 and legal assurances described in paragraph 

17 (3)(A) are in place to carry out the proposed 

18 project, the likelihood of success of the bank is

19 high, and a construction schedule has been ap20 proved. 

21 ‘‘(D) DEBITS.—To the maximum extent 

22 practicable, the Secretary shall use the same 

23 methodology to quantify debits as is used to 

24 quantify credits at a mitigation bank.
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1 ‘‘(E) NO REGULATION OF CREDIT

2 PRICE.—The Secretary may not regulate the 

3 price charged for the sale of mitigation credits. 

4 ‘‘(5) SERVICE AREAS.—

5 ‘‘(A) ADDITIONAL GUIDANCE.—The Sec6 retary may provide additional guidance, con7 sistent with the Federal Guidance, on the size 

8 and use of the service area, including policies 

9 regarding linear utility facilities. 

10 ‘‘(B) INTERSTATE AGREEMENTS.—If the 

11 proposed service area or mitigation bank is lo12 cated in more than 1 State, the Secretary is au13 thorized to resolve any interstate disagreement. 

14 ‘‘(6) MITIGATION.—

15 ‘‘(A) IN GENERAL.—A mitigation bank ap16 proved under this subsection may, in accord17 ance with this section, provide compensatory 

18 mitigation for activities requiring authorization 

19 under this section or provide required injunctive 

20 relief in an enforcement action by the Secretary 

21 or the Administrator. 

22 ‘‘(B) IN-KIND AND OUT-OF-KIND.—Con23 sistent with the Federal Guidance, in-kind com24 pensation of wetlands impacts should generally 

25 be required. Out-of-kind compensation may be 
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1 acceptable if it is determined to be practicable 

2 and environmentally desirable on a case-by-case 

3 basis. 

4 ‘‘(C) EQUIVALENT STANDARDS AND CRI5 TERIA.—Not later than 1 year after the date of 

6 enactment of this subsection, the Secretary and 

7 the Administrator, in consultation with the 

8 heads of appropriate Federal agencies, shall 

9 issue regulations establishing standards and cri10 teria applicable to the use of on-site mitigation, 

11 in lieu fees, and other off-site mitigation as 

12 compensatory mitigation that are similar to the 

13 standards and criteria applicable to a mitiga14 tion bank under this subsection. Such standards 

15 and criteria shall include, consistent with this 

16 subsection, a definition of in lieu fees and spe17 cific measures addressing selection of wetland 

18 mitigation projects, timing for initiation and 

19 completion of wetland mitigation projects, and 

20 other terms to ensure that such fees are used 

21 only under appropriate circumstances with ade22 quate controls. 

23 ‘‘(7) REPORT TO CONGRESS.—Not later than 2 

24 years after the date of enactment of this subsection, 

25 the Secretary shall transmit to Congress a written 
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1 report on the effectiveness of wetlands mitigation 

2 banking and other forms of compensatory mitigation 

3 in meeting the policy and goals identified in section 

4 101(a)(8). The report shall first be issued in draft 

5 form and, in a 60-day period, the Secretary shall re6 ceive comments from the public about the accuracy 

7 of the information contained in the draft report. The 

8 final report shall be revised after consideration of 

9 the public comments and submitted to Congress not 

10 later than 90 days after the last day of the comment 

11 period. 

12 ‘‘(8) EXISTING BANKS.—Nothing in this sub13 section may be construed to require a person oper14 ating a mitigation bank in existence on the date of 

15 enactment of this subsection to submit an applica16 tion for a charter under this subsection to the Sec17 retary for approval. 

18 ‘‘(9) MITIGATION BANKING APPROVED UNDER

19 STATE PROGRAMS.—A State that operates a pro20 gram under subsection (h)(2)(A) may administer a 

21 wetland mitigation banking program in accordance 

22 with procedures established by State law or regula23 tion if the banking program is approved by the Ad-
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1 ministrator as a part of the State’s approved pro2 gram under such subsection.’’.

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