New Legislation Causes Wetland Mitigation Cost to Rise

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The I-12 Corridor has seen a glut of new developments over the past two years. The majority of these developments include single-family residential subdivisions as housing demand has returned from the lows during the national recession. Wetland mitigation is a barrier and has always been a costly and timely expense.

In December 2014, State Representative Steve Scalise stated, “The Modified Charleston Method (MCM) is a radical environmental regulation that stunts economic development in Louisiana.” This method was used by the New Orleans Army Corps of Engineers to determine the number of credits needed for wetland mitigation purposes. In some instances, the MCM increased wetland cost from $6,000 per acre to over $40,000 per acre and made many south Louisiana developments such as single-family subdivisions not financially feasible.

In 2015, Legislation was passed to ban the MCM and the deadline to find a replacement assessment is September 30, 2015. The New Orleans District’s plan to address this revision consist of two phases: Interim Assessment Protocol and Long-Term Assessment Protocol. The Interim Assessment utilizes a Ratio Matrix to determine the appropriate compensatory mitigation for wetland impacts. The matrix is based on the habitat quality of impacted wetlands (low to high) and the type of mitigation (re-establishment, rehabilitation, and enhancement).

According to Mr. Mike Henry with Hydrik Wetland Consulting in Hammond, Louisiana, this interim model has more than doubled the mitigation cost. The Army Corps of Engineers typically rate all forested sites as a high habitat quality and the cost is currently over $80,000 per acre in the St. Tammany mitigation bank.

While this is only the interim cost, Mr. Henry did believe a new model will ultimately lower mitigation cost. But this cost is unknown at this time. The Army Corps long-term assessment noted, “Agency coordination and public input will be key components in the path forward to establishing an assessment method to replace the Modified Charleston Method.”

We will have to wait until September 30, 2015 to determine if wetland mitigation and economic development can coexist.

– Ashton W. Ray,  MAI