amendment. Amendment applications shall be 
processed in the same manner as charter appli-
cations, but the Secretary may treat the facts 
established in support of the charter and con-
firmed by the most recent report required under 
subparagraph (J) as established for the purpose 
of the amendment application process. 
‘‘(J) PERIODIC
REPORTS.—Persons hold-
ing a mitigation bank charter shall report to 
the Secretary in accordance with the charter 
and on a periodic basis, as determined by the 
Secretary. The report shall include—
‘‘(i) information demonstrating the 
success of the proposed restoration, en-
hancement, 
creation, 
or 
preservation 
project; 
‘‘(ii) a demonstration of a continued 
compliance with financial assurance re-
quirements;
‘‘(iii) a demonstration of a continued, 
adequate, long-term source of water to 
support the wetland; 
‘‘(iv) a progress report in accom-
plishing the construction and design, oper-
ations, and maintenance plan provided in 
the charter; 
‘‘(v) a reconciliation of the number of 
credits sold during the previous years, the 
number of credits remaining, and any 
change in the number of credits made in 
accordance with the requirements of this 
subsection; and 
‘‘(vi) any other reporting requirement 
defined in the charter. 
‘‘(K) RESPONSIBILITY
FOR
BANK
SUC-
CESS.—Subject to the terms of the charter, a 
person holding the charter shall be responsible 
for ensuring the success of the restoration, cre-
ation, enhancement, and preservation activities. 
‘‘(L) REVOCATION.—A mitigation banking 
charter—
‘‘(i) shall be revoked by the Sec-
retary—
‘‘(I) for a criminal conviction for 
making material false statements in 
the charter application or annual re-
port; and 
‘‘(II) for substantial violations of 
law (other than violations described in
clause (I)) that demonstrate the 
unfitness of the holder of the charter 
to operate the mitigation bank; and 
‘‘(ii) may be revoked by the Sec-
retary—
‘‘(I) for a substantial failure of 
the bank to perform as expected in 
the charter; and 
‘‘(II) for a substantial failure to 
comply with the terms of the charter, 
including financial assurances or crit-
ical operating requirements. 
The charter may be revoked only after an op-
portunity for a public hearing. 
‘‘(M) STANDARDS AND CRITERIA FOR SUC-
CESS.—The Secretary, in consultation with the 
Administrator, shall establish standards and 
criteria for the success of mitigation banks 
under this subsection. 
‘‘(4) CREDITS AND DEBITS.—
‘‘(A) NUMBER OF CREDITS.—The number 
of credits to which a chartered mitigation bank 
is entitled for wetlands restoration, enhance-
ment, and creation shall be based on the meth-
odology contained in the charter, consistent
with the approach identified in the Federal 
Guidance. Limited credits may be granted, con-
sistent with the Federal Guidance, for the in-
clusion of uplands, open water, and preserved 
wetlands areas within a bank if the uplands, 
open water, and preserved wetlands areas with-
in the bank increase the overall ecological func-
tioning of the bank. 
‘‘(B) CREDITS BASED SOLELY ON PRESER-
VATION.—The number of credits that are based 
solely on preservation should be based on the 
functions that would otherwise be lost or de-
graded if the wetlands were not preserved, and 
the timing of such loss or degradation, pursu-
ant to the Federal Guidance. In any case in 
which the Secretary determines that preserva-
tion of wetlands is appropriate as the sole basis 
for providing mitigation credits, the Secretary 
shall make a determination that the wetlands—
‘‘(i) perform physical or biological 
functions, the preservation of which is im-
portant to the region in which the wetlands 
are located; and 
‘‘(ii) are under a demonstrable threat 
of loss or substantial degradation due to
activities that might not otherwise be ex-
pected to be restricted and that are not the 
consequence of actions under the control of 
the bank sponsor. 
‘‘(C) OFFERING
CREDITS
FOR
SALE.—
Upon receipt of its charter, a mitigation bank 
may offer mitigation credits for sale in accord-
ance with the charter. The number of credits 
that a mitigation bank may offer for sale shall 
not exceed the number to which the bank is en-
titled under the charter. As specifically ap-
proved under the charter, and consistent with 
the Federal Guidance, limited credits may be 
sold before restoration, enhancement, or cre-
ation activities have begun if adequate financial 
and legal assurances described in paragraph 
(3)(A) are in place to carry out the proposed 
project, the likelihood of success of the bank is
high, and a construction schedule has been ap-
proved. 
‘‘(D) DEBITS.—To the maximum extent 
practicable, the Secretary shall use the same 
methodology to quantify debits as is used to 
quantify credits at a mitigation bank.
‘‘(E) 
NO
REGULATION
OF
CREDIT 
PRICE.—The Secretary may not regulate the 
price charged for the sale of mitigation credits. 
‘‘(5) SERVICE AREAS.—
‘‘(A) ADDITIONAL
GUIDANCE.—The Sec-
retary may provide additional guidance, con-
sistent with the Federal Guidance, on the size 
and use of the service area, including policies 
regarding linear utility facilities. 
‘‘(B) INTERSTATE
AGREEMENTS.—If the 
proposed service area or mitigation bank is lo-
cated in more than 1 State, the Secretary is au-
thorized to resolve any interstate disagreement. 
‘‘(6) MITIGATION.—
‘‘(A) IN GENERAL.—A mitigation bank ap-
proved under this subsection may, in accord-
ance with this section, provide compensatory 
mitigation for activities requiring authorization 
under this section or provide required injunctive 
relief in an enforcement action by the Secretary 
or the Administrator. 
‘‘(B) IN-KIND
AND
OUT-OF-KIND.—Con-
sistent with the Federal Guidance, in-kind com-
pensation of wetlands impacts should generally 
be required. Out-of-kind compensation may be
acceptable if it is determined to be practicable 
and environmentally desirable on a case-by-case 
basis. 
‘‘(C) EQUIVALENT STANDARDS AND CRI-
TERIA.—Not later than 1 year after the date of 
enactment of this subsection, the Secretary and 
the Administrator, in consultation with the 
heads of appropriate Federal agencies, shall 
issue regulations establishing standards and cri-
teria applicable to the use of on-site mitigation, 
in lieu fees, and other off-site mitigation as 
compensatory mitigation that are similar to the 
standards and criteria applicable to a mitiga-
tion bank under this subsection. Such standards 
and criteria shall include, consistent with this 
subsection, a definition of in lieu fees and spe-
cific measures addressing selection of wetland 
mitigation projects, timing for initiation and 
completion of wetland mitigation projects, and 
other terms to ensure that such fees are used 
only under appropriate circumstances with ade-
quate controls. 
‘‘(7) REPORT TO CONGRESS.—Not later than 2 
years after the date of enactment of this subsection, 
the Secretary shall transmit to Congress a written
report on the effectiveness of wetlands mitigation 
banking and other forms of compensatory mitigation 
in meeting the policy and goals identified in section 
101(a)(8). The report shall first be issued in draft 
form and, in a 60-day period, the Secretary shall re-
ceive comments from the public about the accuracy 
of the information contained in the draft report. The 
final report shall be revised after consideration of 
the public comments and submitted to Congress not 
later than 90 days after the last day of the comment 
period. 
‘‘(8) EXISTING BANKS.—Nothing in this sub-
section may be construed to require a person oper-
ating a mitigation bank in existence on the date of 
enactment of this subsection to submit an applica-
tion for a charter under this subsection to the Sec-
retary for approval. 
‘‘(9) MITIGATION BANKING APPROVED UNDER 
STATE PROGRAMS.—A State that operates a pro-
gram under subsection (h)(2)(A) may administer a 
wetland mitigation banking program in accordance 
with procedures established by State law or regula-
tion if the banking program is approved by the Ad-
ministrator as a part of the State’s approved pro-
gram under such subsection.’’.
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