US Army Corps of Engineers
Baltimore District

Regulatory Sourcebook

Official source for permitting policies, guidelines, regulations and procedures of the Baltimore District Regulatory Branch.  
The fundamental objective of compensatory mitigation is to offset environmental losses resulting from unavoidable impacts to waters of the United States authorized by DA permits and to replace the loss of wetland, stream, and/or other aquatic resource functions. Compensatory mitigation involves the actions taken to offset unavoidable adverse impacts to the aquatic ecosystem after all appropriate and practicable steps have been taken to avoid and then minimize adverse impacts to wetlands, streams, and other aquatic resources authorized by Clean Water Act section 404 permits and other Department of the Army permits. Compensatory mitigation can be carried out through the restoration of a previously-existing wetland or other aquatic site, the enhancement of an existing aquatic site’s functions, the establishment (i.e., creation) of a new aquatic site, or, in some cases, the preservation of an existing aquatic site.

Types of Compensatory Mitigation

The methods of compensatory mitigation are through the restoration, establishment, enhancement or in certain circumstances preservation of wetlands, streams or other aquatic resources for the purpose of offsetting unavoidable adverse impacts. The hierarchy of forms and locations of compensatory mitigation include:

1) Mitigation Bank Credts: A mitigation bank is a wetland, stream, or other aquatic resource area that has been restored, established, enhanced, or (in certain circumstances) preserved for the purpose of providing compensation for unavoidable impacts to aquatic resources permitted under Section 404 or a similar state or local wetland regulation. Mitigation banks are a form of "third-party" compensatory mitigation, in which the responsibility for compensatory mitigation implementation and success is assumed by a party other than the permittee.

2) In-Liew Program Credits: Where permitted impacts are located within the service area of an approved in-lieu fee program and the sponsor has the appropriate number and resource type of credits available, the permittee's compensatory mitigation requirements may be met by securing those credits from the sponsor, the third-party.

3) Permittee-Responsible Under a Watershed Approach: Where permitted impacts are not in the service area of an approved mitigation bank or in-lieu fee program that has the appropriate number and resource type of credits available, permittee-responsible mitigation is the only option. In this case, the resource type and location for the required permittee-responsible compensatory mitigation should be determined using the principles of a watershed approach, where practicable and likely to be successful and sustainable.

4) Permittee-Responsible Through On-Site and In-Kind Mitigation: In cases where a watershed approach is not practicable, the District Engineer should consider opportunities to offset anticipated aquatic resource impacts by requiring on-site and in-kind compensatory mitigation. The District Engineer must also consider the practicability of on-site compensatory mitigation and its compatibility with the proposed project.

5) Permittee-Responsible Through Off-Site and Out-of-Kind Mitigation: If, after considering opportunities for on-site, in-kind compensatory mitigation, the District Engineer determines that these compensatory mitigation opportunities are not practicable, are unlikely to compensate for the permitted impacts, or will be incompatible with the proposed project, and an alternative, practicable off-site and/or out-of-kind mitigation opportunity is identified that has a greater likelihood of offsetting the permitted impacts or is environmentally preferable to on-site or in-kind mitigation, the District Engineer should require that this alternative compensatory mitigation be provided.

For more information on all types of compensatory mitigation, please review the Regulatory Sourcebook.