New Corps Memos on Timelines for Reviewing Mitigation Banks are a Game-Changer
In mid-September, as we went to press with the 2024 update to the Time it Takes for Restoration - EPIC’s ongoing research on timelines of the review process for mitigation banks - leadership from USACE published:
“Improving U.S. Army Corps of Engineers Timeline Compliance with the 2008 Compensatory Mitigation Rule” (16 Sept. 2024 Assistant Secretary of the Army Michael Connor’s memo - herein ‘ASA memo’), and
“Principles of Delivery for Mitigation Bank Decisions” (19 Sept. 2024, Chief of Regulatory Jennifer Moyer, herein ‘principles document’).
These memos are a big deal, and here’s why:
Delays in timelines are not a new thing - the Corps has been exceeding their timeline goals for at least a decade (which is the extent of our data, see Figure 3). While the Corps has been internally reporting on a performance metric related to timelines, this is a significant public acknowledgement of delays. Data from EPIC | ERBA’s research made it hard to ignore that delays are occurring throughout the country.
Corps leadership are clearly communicating that sticking to timelines is a priority. The Army is, after all, extremely hierarchical, so if your boss thinks something is important, you think it’s important.
There are specific directives of pathways to speed up the process while maintaining a focus on the same quality of ecological outcomes.
As an example of their potential impact, the memo directs staff to reduce multiple versions and iterations of draft project proposals (called ‘instruments’). Our research found that mitigation bank sponsors spend 45 - 1,000 days AFTER they have submitted their complete draft instrument. Many sponsors have noted that multiple iterations of draft documents and opening ‘closed’ comments are part of this prolonged timeline. We estimate that if the Corps’ directives are even modestly implemented and enforced, it will reduce mitigation bank review timelines by an average of 9 months and cut the timeline of credit releases by half - that is worth millions in saved financing costs alone, let alone the benefit to infrastructure of having more credits for mitigation available faster.
Major Themes of the Corps Announcements
1. Direction to comply with the 2008 Rule timelines
The memo and principles document both emphasize the importance of complying with timelines stipulated in the 2008 rule governing aquatic compensatory mitigation for Clean Water Act 404 permits. The emphasis is not just on the instrument review process, but also the credit release review process which currently is not tracked and does not have internal Corps performance metrics for accountability.
The ASA memo notes that a site visit may not be necessary to make a decision on a credit release request if sufficient information / documentation is provided (e.g., scheduling should not hold up a credit release).
The principles memo also pointed out the opportunity to develop an Memorandum of Agreement (MOA) for more efficient review of credit release requests. An example is the MOA between the Norfolk District and the Virginia Department of Environmental Quality whereby VA DEQ takes the lead on reviewing credit release requests.
The principles document also reminds staff of the few valid reasons for extension of timelines noted in the 2008 Rule. Those reasons are:
1) “taking the time necessary to comply with other applicable laws and policies” (e.g., ESA, the National Historic Preservation Act, conducting government-to-government consultations with tribes);
2) if the sponsor has not submitted information in a timely way, or
3) if the sponsor has not delivered information essential for making a decision on the instrument.
The ASA memo also indicates that USACE headquarters should track causes of delays (e.g., in their ORM database) and gather feedback from multiple sources to help identify delays and solutions.
2. The Interagency Review Team (IRT) should not hold up the timelines
Both the memo and principles document emphasize this. The memo reminds staff of USACE’s leadership role. Only the signature of the USACE and the instrument sponsor are needed. IRT agency signatures are not required and while staff should strive for consensus (not unanimity), it is not required and should not come in the way of meeting timelines. The principles memo reminds staff that if there is strong disagreement at the stage of final instrument review, there is a dispute resolution process available to IRT members. Likewise, IRT comments and participation in site visits are welcomed, but delays are not tolerated.
The memo directs staff to reduce multiple versions and iterations of draft instruments, which has become the norm. The principles document goes into more depth, noting that the IRT gets only one review of the draft instrument, and only the comments given will be considered. “The district should disregard any piecemeal comments provided by the IRT member after the 30-day time frame has ended.” Additionally, the principles document doubles down on ‘you only get one bite at the apple’: whatever sections of the draft instrument have not been commented on will be copied as-is into the final instrument and “the district should not accept additional IRT comments on the completed sections of the draft instrument.”
3. Re-focusing the attention towards ecological performance
The principles document spends three pages on this interesting paradigm shift, acknowledging the dynamic and uncertain nature of ecosystem restoration. USACE staff are directed to use credit release review as the "primary risk management tool" to ensure outcomes. More credits should be released towards the later stages of the project, upon "full achievement of ecological performance standards." Staff should view the mitigation work plan as a strategy, de-emphasizing the level of detail needed to a “60% level of design detail.” This approach allows mitigation bankers flexibility to address the unexpected. Ecological performance standards should be set as a reasonably achievable range of outcomes, such as those found in reference wetlands and streams. Overall, the directives shift the focus from perfecting a precise plan, to verifying achievable outcomes. In doing so, it also shifts the risk & level of risk tolerance from USACE staff to mitigation bank sponsors, and should therefore streamline the front end of the restoration review process.
4. Tools and practices to comply with the 2008 Rule timelines
The documents discuss creating shared schedules upfront which is a simple but impactful step in project management & mutual accountability of the Corps and project proponents. The ASA memo directed headquarters staff to develop a national level financial assurances template, with input from external stakeholders. Both the memo and principles document also directed developments of templates at the district level for: site protection, credit release schedules, and service area determinations; as well as rapid assessment methods to quantify impacts and offsets. These tools are intended to provide consistency and predictability in the review process. While the memo acknowledged that changes in templates could delay timelines, the memo did not provide direction to “grandfather” a sponsor that was already in the review process, as we previously suggested in our 2023 report.
5. Setting expectations on the level of documentation needed at the prospectus stage
In our 2023 research, interviewees noted that some Districts’ requirements for a prospectus were much more detailed than others. The principles document emphasized that only the items listed in the 2008 Rule are required for a prospectus, and “the district should not require additional information… such as a draft mitigation plan or draft mitigation banking instrument.”
What’s Next?
The recommendations in the USACE documents will doubtless take time to communicate and adopt. EPIC plans follow up research after collecting FY2025 timeline data, and will use our findings from this 2024 report as a baseline to assess whether internal USACE changes result in a more efficient instrument review process.
Other actions that could help timelines in the meantime include:
Providing input on the financial assurance template noted in the directives.
Informing the new administration about the importance of these directives, particularly with the backdrop of a general sense of urgency to find permit efficiencies for all types of projects - renewable energy build out, addressing the housing crisis - because the use of bank credits created in advance of impacts reduces permitting time by 50%.
Establishing regular communication with the Corps to create mutual accountability of stakeholders in adopting the directives.
Exploring the feasibility of codifying the 2008 Rule into a more durable law, particularly in light of the Supreme Court’s decision to overturn a court case that had created a precedent for deference to agency interpretation of law (the ‘Chevron’ defense).
Let us know if you have other thoughts on improving timelines.
The Restoration Economy Center, housed in the national nonprofit Environmental Policy Innovation Center (EPIC), aims to increase the scale and speed of high-quality, equitable restoration outcomes through policy change. Email becca@policyinnovation.org if interested in learning more, sign up for our newsletter, or consider supporting us!
