Federal Guidance on the Use
of Off-Site and Out-of-Kind
Compensatory Mitigation
(Site/Kind Guidance)

Qs and As

Q1: What is the Site/Kind Guidance?

A: The Site/Kind Guidance is one of several items in the Mitigation Action Plan that will move Federal agencies toward the goal of encouraging compensatory mitigation in a watershed context. It recognizes existing policies that encourage compensation on-site (i.e., adjacent to project impacts) and in-kind (i.e., of the same aquatic resource type) but also provides information on circumstances when it is environmentally preferable to perform compensatory mitigation off-site and/or out-of-kind. The Guidance provides an expanded discussion of existing policies and describes an evaluation process for considering off-site and/or out-of-kind alternatives.

Q2: Is it a new regulation?

A: No.

Q3: On what existing regulations, policy and guidance is it based?

A: The Site/Kind Guidance is based on the Section 404(b)(1) Guidelines, other Federal regulations that govern the Clean Water Act Section 404 permit program, and a number of existing policy and guidance documents including the 1990 Memorandum of Agreement concerning the Determination of Mitigation under the Clean Water Act Section 404(b)(1) Guidelines between the Environmental Protection Agency and the Department of Army; the 1995 Federal Guidance for the Establishment, Use and Operation of Mitigation Banks; the 2000 Federal Guidance on the Use of In-Lieu-Fee Arrangements for Compensatory Mitigation under Section 404 of the Clean Water Act and Section 10 of the Rivers and Harbors Act; and the 2002 Corps of Engineers Regulatory Guidance Letter on Compensatory Mitigation Projects for Aquatic Resource Impacts Under the Corps Regulatory Program Pursuant to Section 404 of the Clean Water Act and Section 10 of the Rivers and Harbors Act of 1899.

Q4: What are the goals of the Guidance?

A: One goal of the guidance is to summarize and consolidate existing guidance on off-site and out-of-kind compensation in the five documents mentioned above. A second goal is to explain the flexibility that existing regulations and policies already allow for making decisions about the appropriateness of off-site or out-of-kind compensation. Finally, the intent of the guidance is to provide a framework for making decisions about the appropriateness of on-site, off-site, in-kind, or out-of-kind compensation. The guidance will move the program to a more watershed-based approach to mitigation site selection and planning and improve the success of required mitigation, consistent with the conclusions of a 2001 National Research Council report on wetlands mitigation (1).

Q5: If the National Research Council’s (NRC) 2001 report states that an automatic preference for on-site and in-kind is inconsistent with a watershed approach, then why does Section IV. C of the Site/Kind Guidance still report that there is a preference for in-kind and on-site mitigation?

A: The NRC report concludes that an automatic preference for on-site and in-kind compensation is inappropriate, but does not state that such a preference is completely invalid. This guidance explains that existing policies do contain a preference for on-site and in-kind compensation, but only when on-site and in-kind mitigation provides appropriate compensation in an ecologically successful, sustainable manner. This guidance also states that off-site and/or out-of-kind mitigation is acceptable when it is determined to be environmentally preferable. This guidance states that compensatory mitigation decisions should be made from a watershed perspective in which the type and location of compensatory mitigation follows from an analytically based watershed assessment to assure that the proposed compensation furthers watershed goals.

Q6: With this Guidance will applicants have more flexibility in selecting compensatory mitigation options?

A: The flexibility to consider off-site and out-of-kind alternatives already exists. This Guidance reiterates it and provides a framework for using it.

Q7: With this Guidance will Corps of Engineers field staff require more justification and more strict mitigation measures to ensure success of the mitigation?

A: This guidance does not require increased justification or stricter compensation measures. Instead, it provides a framework for an evaluation that the Corps already conducts on every mitigation proposal. However, in a separate but related effort the Corps has directed all Districts to develop District-wide Guidelines for wetland mitigation and monitoring. You should contact your individual Corps District for more information about these District-wide mitigation and monitoring guidelines.

Q8: The guidance mentions both "environmentally preferable" and "practicable". Who determines whether a compensatory mitigation project meets these criteria?

A: In the Clean Water Act Section 404 permitting program, the Corps determines whether a particular mitigation proposal provides appropriate compensation for aquatic resources lost through permitted activity.. "Practicable" is a criterion used in the Corps decision-making process and is defined as "available and capable of being done after taking into consideration cost, existing technology, and logistics in light of overall project purposes" [40 CFR 230.10(a)(2)]. "Environmentally preferable" is not a term defined in regulation, but is a concept that has been used in previous guidance to convey an intent to choose the option that is best for the environment. In this guidance, this term is further clarified (in sections IV.E. and IV.F.) with respect to the appropriateness of off-site and out-of-kind compensation.

Q9: How many "holistic watershed plans" exist and what, if anything, do they include in reference to mitigation preferences?

A: Although many watershed plans currently exist, an exact number is not known. These plans are often developed by local or regional committees and workgroups and are not cataloged. Some watershed plans are very narrow in scope and do not contain information that would be useful in assessing compensatory mitigation options. For this reason, this guidance encourages the use of "holistic" watershed plans that do contain information about watershed needs and priorities specifically related to aquatic habitats such as wetlands. The guidance directs applicants and decision-makers to refer to these plans if they exist and if they contain information that can be used to assess the appropriateness of a particular compensatory mitigation project. However, the guidance does not rely on there being a holistic watershed plan in place. Instead, the guidance provides an evaluation process for considering off-site and/or out-of-kind alternatives in a watershed context in the absence of a holistic watershed plan.

Q10: Do the mitigation sequencing guidelines (i.e., avoid, minimize, and compensate) outlined in the 1990 Mitigation MOA still apply?

A: Yes, impacts associated with regulated activities must be avoided and minimized to the extent practicable. For unavoidable impacts, compensatory mitigation is required to replace the loss of aquatic resource functions in the watershed. This Guidance assists in the selection of appropriate measures to compensate for unavoidable losses.

Q11: Where can I obtain a copy of this Guidance?

A: The Guidance is available on the Interagency Mitigation Action Plan website at: www.mitigationactionplan.gov

A copy may also be obtained by submitting a request to: Palmer Hough, U.S. Environmental Protection Agency, Wetlands Division (4502T), 1200 Pennsylvania Avenue, NW, Washington, DC 20460

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