Over the next two weeks, Policy Watch will publish a series of stories about a commonly used method of environmental protection for wetlands and streams called “compensatory mitigation.”

The federal Clean Water Act requires developers of residential, commercial, transportation and energy projects to offset “unavoidable impacts” to streams or wetlands. They usually accomplish this by buying “credits” from the state Division of Mitigation Services (DMS) or private mitigation banks, of which there are roughly 20 in North Carolina.

DMS and the private banks generate and sell the credits by restoring, preserving or creating environmental projects in advance within the same watershed. They use the fees in part to fund additional mitigation projects for future projects.

The Policy Watch series will examine the successes and challenges of compensatory mitigation in the Triangle, including the ramifications of environmental policies proposed and enacted by the Trump administration.

Today’s installation focuses on how suburban sprawl in and around Wake County is encroaching on streams and wetlands, prompting the need for mitigation. Yet private development of these large tracts makes it more difficult for state environmental officials to find suitable acreage to restore.

Next week, Policy Watch will examine the potential fallout on mitigation from the Trump administration’s rollbacks of environmental regulations.

This series was funded by a grant from the the Triangle Community Foundation.

Mitigation 101 Compensatory mitigation: Under the Clean Water Act, the EPA and the US Army Corps of Engineers oversee this program. When a developer or state agency can’t avoid or minimize an impact to a wetland or stream, it must offset the damage through a compensatory mitigation program in order to receive a water quality permit. Credits: Like a monetary system, “credits” are purchased from mitigation banks, state agencies, or nonprofits, by developers who are impacting wetlands and streams. The sellers use the money to pay for the mitigation. The value of credits in North Carolina is established by the Environmental Management Commission, and are based on the actual costs of the projects. Permittee-responsible: The developer performs the mitigation and is responsible for the project’s implementation and success. Mitigation can occur at the same location as the impacts, or off-site within the same watershed. Mitigation banks: Private restoration firms that sell credits to developers to meet requirements for compensatory mitigation. The bank is responsible for the success of the project. Mitigation is conducted off-site. In-Lieu Fee Mitigation: A state agency, like the Division of Mitigation Services, or a nonprofit organization sells credits to developers. The agency or nonprofit is responsible for the project’s success, which occurs off-site. In some states, the mitigation occurs after the impacts, which creates a time lag. But in North Carolina, it happens in advance. Ratio: The number of acres or linear feet that must be mitigated for every acre or linear foot that is impacted. That could be as high as 10 acres of mitigation required for one acre of impacts in particularly sensitive areas. Usually the ratio is 2-to-1 or 5-to-1. The ratio depends on the type of wetlands or streams that will be impacted, the acres or linear feet, and the type of mitigation. HUC: Hydrologic Unit Code is synonymous with watershed. An HUC is a geographic area representing part or all of a surface water basin or basins. Examples in North Carolina include watersheds within the Neuse River and the Cape Fear River basins, which include parts of the Triangle. No net loss: This doesn’t mean “no loss.” Wetlands and streams can still be impacted, but they must be replaced by a wetland or stream of the same size and with similar functions. Sources: EPA, US Department of Agriculture, USACE

T he noonday sun is pounding the crowns of our heads as we hopscotch over cow patties and hurdle an electric fence. We make a beeline for a shady copse of sweetgum trees, whose seed pods look like asterisks scattered on the ground. On one side of a small dam, a pond where cattle drink and excrete is the color and consistency of split pea soup. On the other side, invasive bamboo has created an impenetrable thicket, elbowing out native plants.

The Odell Edwards Farm, near the border of Wake and Johnston Counties, was once one of the largest tobacco-growing operations in eastern North Carolina. But as tobacco fell out of favor, the family turned to other crops and livestock. Many neighboring farms did the same, while others sold their family land to developers.

Now here in this patch between Wendell and Clayton, the Odell Edwards family and other long-time family farmers are allowing the state’s Division of Mitigation Services and the engineering firm Water & Land Solutions to install environmental projects to help save their land and the ecosystem.

“These families understand the value and importance of farming and putting food on people’s tables,” says Kayne Van Stell, vice president of ecosystem services at Water & Land. “They’re also trying not to succumb to the pressures of urbanization and rising land costs. They want to be land stewards but they want to diversify the farm. Here’s what they’re doing: They’re taking this land and putting it to conservation via mitigation.”

Legally, development can’t result in a “net loss” of feet or acreage. For example, if the state Department of Transportation fills in a half-acre of wetland to build a highway, then at minimum, and usually more, a half-acre must be restored, created or enhanced somewhere else.

The tension, though, is that the US Army Corps of Engineers requires those impacts to be mitigated within the same watershed. Yet when tracts that are suitable for mitigation become scarce and costly, like they are in the Triangle, it can be difficult to meet the mandate.

“One of the of criticisms of some mitigation projects is that they are far removed from the area of impacts,” Van Stell says. “But often, developing areas are where you need it most. It’s challenging from a property standpoint. So this farm and adjacent mitigation projects are a really unique opportunity.”

In Wake County, competition for land

F rog eggs!”

PeriAnn Russell, a geomorphologist and supervisor with DMS, spots a cluster of what to the untrained eye appear to be translucent black-eyed peas in the pond at the Odell Edwards Farm.

Currently, cattle can wade into the water, and their waste feeds the growth of algae. It’s natural for algae to consume oxygen in a pond, but an overgrowth of the aquatic plant can block light from reaching the pond’s depths and suffocate all but the hardiest fish and other aquatic life. Finding frog eggs in this morass of green scum is a bonus.

Beyond the pond lies Flowers Plantation, a massive subdivision on what used to be 3,000 acres of cotton and tobacco fields. Developments like these are competing with the state and private mitigation banks for acreage. That’s why the Odell Edwards site and four nearby mitigation projects – Lake Wendell, Pen Dell, Edwards Johnson and Buffalo Creek – are so coveted.

With more than one million residents, Wake County is among the fastest-growing areas in North Carolina. Land that was once grazing pasture or row crops is now shopping centers or housing developments.

Permits for new multi-family housing jumped nearly 38 percent from 2017 to 2018, according to Wake County figures. Wendell’s population has increased by a third over the past decade, while Johnston County’s has grown by 20 percent over the same period.

A major highway scheduled to break ground later this year is the 28-mile Complete 540 project, a toll road. It will connect southern and eastern Wake County via northwestern Johnston County, but in so doing, will impact 156 wetlands totaling 69.5 acres, as well as 39 ponds. The highway will cross streams, including the sensitive Middle Creek, Lower Swift Creek and the Neuse River, 140 times.

All of those Complete 540 impacts – and more, as detailed in in a recent court settlement with the NC Department of Transportation – must be mitigated.

“This is the tale of a changing watershed,” says Van Stell. “It’s urbanizing. With sprawl like 540 and the 540 expansion, you see these hubs off the exits. Wendell was a sleepy, quiet town and now it’s rapidly growing.”

To do correctly, mitigation requires feats of engineering and science: analyzing minute details, such as measuring how high a log protrudes from a stream bed, faithfully reconfiguring the curves of a waterway or calculating the depth of a pool.

“We work with nature” says Lindsey Crocker, DMS project manager. “We don’t try to control nature.”

The restoration planned for the Odell Edwards Farm is designed to improve local and downstream water supplies – crucial for drinking, fishing, flood and pollution control. When Water & Land Solutions finishes the project, it will have reclaimed 3,650 linear feet of stream – equivalent to seven-tenths of a mile – and two and a half acres of wetlands.

The company will excise the bamboo. It will remove the dam to the pond, fence out the cattle, restore the stream and rehydrate the wetlands, which have been cut off from their water source. (During construction, if Water & Land Solutions workers spot aquatic life, such as snapping turtles, frogs and fish, they relocate them to other ponds.)

Some of the sweetgum trees will be cut down and their lumber used elsewhere onsite, replaced by plantings of other native tree species to diversify the ecosystem. A 50-foot buffer will help filter farm runoff before it reaches the stream and wetlands. All of it will be protected by a permanent conservation easement. When the project is finished, it will be monitored and evaluated for seven years. After that time, the ecosystem, like a young bird, is ready to fledge.

“The goal is that this stream sustains itself and keeps functioning, biologically and physically for the long-term,” Russell says.

Crocker observes a small stream whose banks have been eroded and carved two to three feet below a nearby flood plain. When connected to their streams, flood plains serve as giant filters and storage containers for the water, critical functions both onsite and downstream. But when separated, Crocker says, “this flood plain isn’t absorbing the water – or in a drought, slowly releasing it.

“With situations like this and with climate change and flash floods,” she says, “the stream is susceptible to falling apart even more.”

The missing link: Tracing mitigation to its original impact

N ear Fantasy Moth Drive, less than a mile off the rush-hour hellscape of Benson Road, lie 84.5 acres of forested land known as the Underhill site, perpetually preserved since 1998.

That’s when DOT purchased the tract in southeastern Wake County for wetlands mitigation in order to offset impacts from construction of the US 70 Clayton Bypass.

“The primary goal of preserving this site is to protect it from future development so that the water quality of the Neuse River may be ameliorated,” reads DOT’s 1997 mitigation plan. Preserving the site, the plan said, would provide wildlife habitat along Swift Creek “in an area slated for intense development pressure.”

By law, DOT and anyone seeking mitigation credits must look first to the private banks, but the agency is still DMS’s largest customer. In 2017-18, according to state documents, it helped DOT get permits for 99 transportation projects by providing more than 66,000 stream mitigation credits and more than 76 wetlands credits.

The cost of credits is pegged to where the mitigation happens. The fee for one stream credit is $507; the program costs to conduct the mitigation range from $279 to $529 per credit. Freshwater wetland credits – $60,000 to $100,000 apiece – are more expensive because the nature of the work is more complex.

And since DMS receives no appropriations from the legislature, it is funded by these fees.

Statewide, DOT has planned for more than 5,000 miles of road construction and widening over the next eight years, according to its master plan. DOT provides DMS a list of mitigation needs years in advance, and has already earmarked $6.3 million to pay for those offsets, with more pending as the result of a settlement with environmental groups over the impacts of the Complete 540 toll road.

But one of the criticisms of mitigation programs is that tracking the distance between the environmental impacts and the mitigation sites can be extremely difficult. The Corps maintains a mitigation database, called RIBITS, that maps and lists all private bank and DMS sites and provides basic information about them. But neither the Corps nor DOT links them to the original impact.

Nor does DMS. It places all requests for mitigation credits into “a bucket” and allocates them based on the watershed where the impacts will occur.

But watersheds are expansive. Within the Neuse River Basin, a smaller regional watershed that includes parts of Wake and Johnston counties spans 580 square miles. A mitigation project near Lake Wheeler in southwest Raleigh might not directly benefit a wetland that’s been filled in 18 miles away to the northwest, near Upper Buffalo Creek. The state is targeting sub-watersheds and local watersheds to maximize the benefits as close to the impact as possible.

And instead of restoring areas piecemeal, DMS is trying to combine sites into larger, connected tracts, like those near the Wake/Johnston County line. This area could further benefit from the court settlement over Complete 540, which requires DOT to match 25 percent of the amount Wake County spends on open space through 2023. The agreement also mandates that DOT purchase properties as close as possible to Swift Creek, the toll road route, and the watersheds affected by the project.

“In some areas of the state we’ve exhausted the mitigation opportunities,” says Tim Baumgartner, director of the Division of Mitigation Services. “Crabtree Creek would be an awesome area to do mitigation. But current requirements – 50-foot buffers, avoiding power lines and sewer crossings – he says, “make it difficult to obtain the credits.”

Todd BenDor, a professor of city and regional planning at UNC Chapel Hill, has written extensively about the shortcomings of mitigation nationwide. In 2009, BenDor said, he, another researcher and a graduate student spent a year parsing through North Carolina documents, “and we barely made heads or tails of the data. It should be easy, but in fact, it’s not.”

It’s important to analyze the distances between impact and mitigation not only for planning purposes but also to monitor potential environmental justice issues. It’s common for major highway projects to plow through low-income neighborhoods; Complete 540 is taking out at least half of a mobile home park near Apex.

If there are streams or wetlands in those neighborhoods, and the mitigation is miles away, then the residents have lost important natural protections against flooding and pollution. Only easily accessible data can reveal whether this is a pattern.

“If I create a wetland in the middle of nowhere, that produces a function, BenDor says. “But if there is no one in the area, it doesn’t serve people.”

“The water will tell you the truth”

A mile from the Odell site, the Edwards-Johnson project is in just its second year of wetland and stream restoration. But already the landscape shows signs of revival.

We reach the stream. Previously it looked like a ditch, six-feet deep. Now, it has been reborn as a stream and has reconnected with its wetlands. The banks, less than a foot deep, have been stabilized with biodegradable matting made from coconut husks.

Because it is intermittent, meaning water flows through it only some of the time, the stream is dry. But beneath it, groundwater still flows, and when the time is right, after a hard rain, will emerge to make a home for bugs and aquatic critters. In the stream bed, a sediment bar provides a hangout for salamanders and frogs.

Like people, a mitigation site is most vulnerable when it’s young, shortly after construction. This is when the plants are working to establish themselves; the soil is exposed. It’s a precarious time for the ecosystem.

Failures can happen if people don’t anticipate changes in the watershed: the roads, developments, runways that can alter conditions miles downstream. They happen if people try to foist an artificial solution – such as overly sinuous stream channels – onto an ecosystem that knows better. “Understanding how systems live and breathe is critical,” Van Stell says. “The water will tell you the truth. It will go where it wants to go.”

In the short lifetime of the Edwards-Johnson site, it has been assailed by two hurricanes and a tropical storm. Yet the banks held. The sediment bars slowed the water’s flow. The system knew what to do. It survived.