Fees: A new piece in the wetlands mitigation puzzle

A new state law authorizes developers — in certain circumstances — to pay a fee to the state in lieu of performing compensatory wetlands mitigation.

The new fee program offers something for everyone: a chance for municipalities to accomplish high-priority local conservation goals; a mechanism for developers to proceed with projects once not viable, because no compensatory wetland mitigation was practicable; and an opportunity for the state to accomplish conservation projects with greater value than can be achieved through conventional compensatory wetland mitigation.

The law — RSA 482-A:3 — requires a permit for any proposed project that involves dredging or filling of a wetland. Before the Department of Environmental Services will issue a permit, applicants must show that the proposed project will avoid adverse impacts to wetlands and will minimize and mitigate those wetland impacts that are unavoidable.

Such mitigation is referred to as compensatory wetland mitigation and is performed on-site and off-site of the proposed project.

Municipal conservation commissions usually cooperate with developers in the process of identifying and selecting property to conserve land where compensatory wetland mitigation will be performed off-site.

The more conservation commissions enable developers to achieve compensatory wetland mitigation, the more likely it will be that DES will issue wetland permits to the developers. Consequently, savvy conservation commissions develop detailed plans targeting parcels for land conservation. Such plans increase the likelihood that municipalities will capture funds from developers to conserve targeted parcels as part of developers’ compensatory wetland mitigation.

But the fee program is not a substitute for the requirement to avoid or minimize impacts to wetlands.

Where DES requires compensatory wetland mitigation, the applicant must still evaluate available opportunities for upland buffer preservation and wetland restoration and creation.

However, the fee program can change the outcome when an applicant for a wetland permit is unable to achieve compensatory wetlands mitigation.

Before the program allowing in-lieu fees, where DES required such mitigation but the applicant was unable to achieve it, the agency would not grant the wetlands permit. Because not obtaining a wetlands permit could mean the end of a proposed project, developers sometimes paid substantial sums to achieve the requisite mitigation. No law limited the cost an applicant could be required to incur for mitigation.

Under the new fee program, developers have a new option — so long as the proposed wetland impact is less than one acre. When an applicant can show to DES that performing compensatory wetlands mitigation is impracticable, the applicant may pay a fee in lieu of performing compensatory mitigation. So long as the applicant satisfies certain other criteria, DES may grant the wetland permit on condition of payment of the in-lieu fee.

A new player

Under the law, DES will calculate the amount of the in-lieu fee by adding three figures: the cost that would have been incurred if the wetland were recreated; the acres of wetlands affected multiplied by the cost of land where the impact is occurring; and an administrative cost equal to 5 percent of the first two figures.

Prior to the fee program, developers were the only individuals or entities performing compensatory wetlands mitigation. The in-lieu-fee program adds the state as an entity that performs compensatory wetland mitigation.

Administrative rule Env-Wt 807 describes the compensatory wetlands mitigation that the state will perform.

Essentially, the state will pool the in-lieu fees it collects into the Aquatic Resource Mitigation, or ARM, fund to perform what’s deemed high-value conservation.

Administrative rule 803.03 prioritizes which conservation projects the state should fund by establishing a preference for projects within the same watershed as the wetlands impact that generated the in-lieu fee.

The ARM fund presents a significant and new opportunity to achieve large-scale conservation goals throughout New Hampshire.

Amy Manzelli is an attorney with the Concord-based law firm of Sulloway & Hollis. Her practice focuses on environmental issues, including litigation, business services and government relations.

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