[Federal Register Volume 64, Number 175 (Friday, September 10, 1999)]
[Notices]
[Pages 49229-49234]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-23627]


-----------------------------------------------------------------------

DEPARTMENT OF THE INTERIOR

Fish and Wildlife Service, Interior


Final Policy on the National Wildlife Refuge System and 
Compensatory Mitigation Under the Section 10/404 Program

AGENCY: Fish and Wildlife Service, Interior

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: The U.S. Fish and Wildlife Service announces the final policy 
on the National Wildlife Refuge System and Compensatory Mitigation 
under the Section 10/404 program. We are establishing guidelines 
regarding the use of the National Wildlife Refuge System for 
compensatory mitigation requirements for water resource development 
projects authorized by the Department of the Army under Section 404 of 
the Clean Water Act and Section 10 of the Rivers and Harbors Act. The 
purpose of the policy is to provide guidance to our personnel when they 
are evaluating whether a National Wildlife Refuge should be considered 
as a site for wetland restoration, enhancement, or creation to replace 
wetlands lost to dredge and fill impacts authorized by a Section 10/404 
permit.
    In general, we will not allow compensatory mitigation on National 
Wildlife Refuge System lands because these lands are already targeted 
for restoration, and we will be restoring these lands in the future. We 
recognize that under some limited and exceptional circumstances, 
compensatory mitigation on a National Wildlife Refuge may be 
appropriate. If compatible activities occurring on a National Wildlife 
Refuge require compensatory mitigation, the mitigation must occur 
within the boundaries of the National Wildlife Refuge being affected 
and must meet specific criteria. We will not support the use of 
National Wildlife Refuge System lands for establishment of mitigation 
banks. We may accept mitigation banks or mitigation projects as 
additions to the National Wildlife Refuge System subject to specific 
criteria. Where habitats have already been protected or restored under 
other Federal programs designed to increase the Nation's wetlands, we 
will not support the preservation of such restored wetlands as 
compensatory mitigation for habitat losses from other projects 
authorized under the Section 10/404 program, except in limited and 
exceptional circumstances.

EFFECTIVE DATE: The policy becomes effective on October 12, 1999.

FOR FURTHER INFORMATION CONTACT: U.S. Fish and Wildlife Service, Dr. 
Benjamin N. Tuggle, Chief, Division of Habitat Conservation, 400 ARLSQ, 
Washington, D.C. 20240, telephone (703) 358-2161; or Dr. Richard A. 
Coleman, Chief, Division of Refuges, 600 ARLSQ, Washington, D.C. 20240, 
telephone (703) 358-1744.

SUPPLEMENTARY INFORMATION:

Background

    The national goal of no net loss of wetlands recognizes the 
importance and the special significance of wetlands to a variety of 
functions and values including water quality, flood damage reduction, 
groundwater recharge, and reduced sedimentation. In addition, wetlands 
are some of the most important habitats for fish and wildlife resources 
on the landscape. We (the U.S. Fish and Wildlife Service) strongly 
support and contribute to this national goal by helping to reduce 
wetland losses, by restoring lost or degraded wetlands, and by 
protecting valuable wetlands by bringing them into the National 
Wildlife Refuge System.
    We administer over 92 million acres of land and water within the 
National Wildlife Refuge System, and we have at least one National 
Wildlife Refuge in each of the 50 states. The mission of the National 
Wildlife Refuge System is to administer a national network of lands and 
waters for the conservation, management, and where appropriate, 
restoration of the fish, wildlife, and plant resources and their 
habitats within the United States for the benefit of present and future 
generations of Americans. We may allow public uses of National Wildlife 
Refuge System lands, such as wildlife dependent recreation, when they 
are compatible with the purposes of the refuge. However, the National 
Wildlife Refuge System was established and is being managed first and 
foremost for fish, wildlife, and plant conservation.
    At times, we have acquired lands that have been disturbed by past 
human activities. As such, some National Wildlife Refuges contain 
degraded fish and wildlife habitats. The development community, and 
others, have asked if these degraded habitats could be used as 
mitigation sites for wetland and wildlife habitat losses that occur 
outside the National Wildlife Refuge System. In the past, we have 
discouraged the use of National Wildlife Refuge System lands for 
compensatory mitigation, because we are authorized to restore degraded 
habitats within the National Wildlife Refuge System and we will be 
restoring these lands in the future, irrespective of off-Refuge 
development. However, until now, we have not had a specific policy that 
outlines when, or if, compensatory mitigation on National Wildlife 
Refuge System lands might be appropriate.
    We recognize that allowing compensatory mitigation on a refuge 
could result in some resource gains within the National Wildlife Refuge 
System. However, if we were to target the National Wildlife Refuge 
System for compensatory mitigation, we could be facilitating a 
significant net loss of wetlands within the watershed. But we also 
recognize there may be some limited and exceptional circumstances where 
allowing compensatory

[[Page 49230]]

mitigation to be implemented on a refuge may be in the best interest of 
the fish, wildlife, and wetland resources in the area. Therefore, the 
policy provides guidance and flexibility to our personnel when they are 
determining whether, or under what circumstances, we might allow the 
National Wildlife Refuge System to be used for compensatory mitigation 
under the Section 10/404 program.

Previous Federal Action

    We published the ``Draft Policy on the National Wildlife Refuge 
System and Compensatory Mitigation under the Section 10/404 Program'' 
in the Federal Register on July 31, 1998 (60 FR 58605). The public 
comment period closed on September 29, 1998.

Summary of Modifications

    We modified the draft policy in response to the public comments and 
additional internal review. Here is a summary of the important changes:
    1. We clarified how the policy relates to private lands and to 
wetlands that have been restored under other Federal programs, such as 
the Partners for Fish and Wildlife Program.
    2. We clarified our explanation of why the policy does not apply to 
impacts to threatened or endangered species. Any impacts associated 
with these species are addressed separately under the Endangered 
Species Act.
    3. We modified the ``grandfather clause'' in Part 7 of the policy. 
We inserted a statement indicating that mitigation projects currently 
being implemented are exempt from the policy. The policy will only 
apply to future projects.
    4. We rewrote the policy in ``Plain Language'', updated and 
modified several definitions, and changed several technical terms for 
consistency.

Responses to Comments

    The following is a summary of the major comments raised during the 
public comment period. We have included a summary of the comments, our 
response, and any modifications to the policy.
    Comment: Several commenters asked about the scope of the policy, 
what we mean by ``National Wildlife Refuge System land'' and whether 
the policy applies to other forms of compensatory mitigation.
    Response. The policy applies to all lands and waters within the 
National Wildlife Refuge System being considered for use as 
compensatory mitigation for activities authorized under the Section 10/
404 program. The policy does not include lands that are within the 
authorized refuge acquisition boundary, unless they are already owned 
by the Fish and Wildlife Service as part of the NWRS. In addition, we 
recognize there are other forms of mitigation being conducted on NWRS 
lands, such as under Section 4(f) of the Department of Transportation 
Act of 1966; however, the policy only addresses compensatory mitigation 
required under the Section 10/404 program.
    Comment: Several commenters are concerned that we are applying this 
policy to private lands, particularly wetlands restored under the 
Conservation Reserve Program, the Wetlands Reserve Program, and the 
Partners for Fish and Wildlife Program.
    Response: This policy provides guidance to Service personnel 
evaluating compensatory mitigation proposals for activities authorized 
under the Section 10/404 program. In contrast to circumstances in which 
mitigation is proposed on lands within the National Wildlife Refuge 
System and thus under the control of the Service, our recommendations 
regarding mitigation proposals on private lands are advisory and not 
controlling upon the permitting agency.
    Preservation of existing wetland habitat compensates for permitted 
wetland loss in only those limited and exceptional circumstances in 
which a change in ownership or protection status serves to maintain 
habitat that would otherwise be certain to be lost. We expect that many 
private landowners who have used Federal conservation programs to 
restore wetlands on their lands will allow those wetlands to remain 
after the term of their restoration agreement or easement expires. 
Accordingly, we will not recommend or support preservation of those 
restored wetlands as compensatory mitigation, except in the limited and 
exceptional circumstances in which their future loss is assured in the 
absence of additional conservation measures.
    Comment: Several commenters stated that if wetlands restored under 
the Partners for Fish and Wildlife Program or the Conservation Reserve 
Program cannot be used for compensatory mitigation, they may be 
converted to non-wetland uses (e.g., agriculture) after the 10-year 
agreement expires. The commenters believe that Section 10/404 permit 
holders should target these lands for compensatory mitigation (i.e., 
preservation) to avoid conversion.
    Response: We have clarified the policy to indicate that where 
wetlands have been restored under Federal wetland restoration programs, 
such as the Partners for Fish and Wildlife Program, we will not support 
the use of these lands as compensatory mitigation under the Section 10/
404 program, during the term of the agreement (e.g., 10 years). Upon 
expiration of the wetland restoration agreement, we will not support 
the preservation of such restored wetlands as compensatory mitigation 
for wetland losses under the Section 10/404 program, except in limited 
and exceptional circumstances. This is consistent with our Mitigation 
Policy and the Federal guidelines for establishing, using, and 
operating mitigation banks.
    Comment: Several commenters asked that we delete the restrictions 
on adding mitigation bank lands to a refuge.
    Response: The policy retains the restrictions on accepting 
mitigation bank lands. We recognize the policy may necessitate changes 
in how mitigation banking and wetland restoration is done in 
conjunction with National Wildlife Refuge System lands. However, the 
purpose of the policy is to ensure national consistency regarding 
compensatory mitigation under the Section 10/404 program and the 
National Wildlife Refuge System.
    Comment: Several commenters asked why we are adopting such rigid 
guidelines for accepting donated mitigation bank lands into the 
National Wildlife Refuge System since mitigation banking represents an 
important opportunity to expand our refuges.
    Response: We recognize that accepting a mitigation bank into the 
National Wildlife Refuge System is an opportunity to protect wetlands 
and other wildlife habitat produced by compensatory mitigation 
projects. That is why we included specific provisions that allow these 
transfers to proceed. However, we want to avoid bringing wetlands and 
other habitats into the National Wildlife Refuge System that are either 
not fully restored, do not have sufficient operation and maintenance 
funding, have mitigation credits running, or otherwise diminish the 
responsibilities of the Section 10/404 program to fulfill its wetland 
preservation goals. That is, we are willing to accept donated 
mitigation bank lands only when they are clear of any outstanding 
mitigation requirements and associated liabilities.
    Comment: Several commenters asked why the policy prohibits 
mitigation banks on National Wildlife Refuge System lands under all 
circumstances, since mitigation banking is another form of compensatory 
mitigation.
    Response: If we allow mitigation banks to be established on 
National Wildlife Refuge System lands, it could

[[Page 49231]]

result in a net loss of wetlands in the watershed. Since National 
Wildlife Refuge System lands are already protected and we will be 
restoring these lands, allowing mitigation banking on National Wildlife 
Refuge System lands would not replace the off-Refuge wetland functions 
and values that are lost to permitted development. By establishing 
mitigation banks on National Wildlife Refuge System lands and selling 
the mitigation credits, we would be ``trading'' off-Refuge wetlands for 
accelerated restoration of on-Refuge wetlands. Although this may result 
in some short-term habitat gains on National Wildlife Refuge System 
lands, in the long-term, it could facilitate a net loss of wetlands in 
the watershed.
    In addition, there are several other concerns:
    1. There may be an appearance of a conflict of interest if we are 
also commenting on and developing mitigation options for the permitted 
development through the Section 
10/404 program;
    2. If we allow mitigation banking on National Wildlife Refuge 
System lands, we might be assigned some degree of liability for future 
operation and maintenance of the bank if the bank sponsor abandons the 
project prior to satisfying all mitigation responsibilities; and
    3. If we allow Section 10/404 permittees to establish mitigation 
banks on National Wildlife Refuge System lands, this may undermine 
entrepreneurial (i.e., economically-based) efforts to develop private 
mitigation banks elsewhere in the watershed.
    Comment: One commenter asked why the policy does not apply to 
threatened or endangered species. The commenter is concerned that if a 
listed species is adversely affected by development permitted under 
Section 10/404, we might allow compensatory mitigation for threatened 
or endangered species to occur on National Wildlife Refuge System 
lands.
    Response: We have clarified the policy to specifically state that 
consideration of impacts to threatened or endangered species is not 
within the scope of this policy. Any such concerns are addressed under 
the Endangered Species Act and its associated regulations at 50 CFR 
Parts 17, 402, and 424.
    Comment: The ``grandfather clause'' in the policy could allow a 
significant amount of mitigation activities to be implemented on NWRS 
lands which are inconsistent with the policy. In the draft policy, the 
clause states: ``The policy does not apply to existing mitigation 
agreements with the Service in effect at the time of policy issuance.'' 
However, we currently have several long-term agreements with various 
organizations and agencies that allow compensatory mitigation to be 
conducted in conjunction with National Wildlife Refuges. These 
agreements could provide a permanent exemption from the policy.
    Response: We have deleted the statement that exempts existing 
mitigation agreements from the policy. Instead, we have stated that the 
policy does not apply to existing mitigation projects that are 
currently being implemented. However, we will review all mitigation 
agreements, and modify them as necessary, to ensure they are consistent 
with the policy. In other words, all mitigation projects currently 
underway are exempt, but any new projects must comply with the policy.

Record of Compliance

    We have prepared a Record of Compliance documenting that this rule-
making action complies with the various statutory, Executive Order, and 
Department of the Interior requirements that are applicable to 
rulemakings. A copy is available upon request. (See FOR FURTHER 
INFORMATION CONTACT.)
    The number of acres of wetlands restored on National Wildlife 
Refuge System lands in FY96 was 79,291, but only approximately 10 acres 
were restored as compensatory mitigation under the Section 10/404 
program. Likewise, of the 60,708 acres of wetlands restored on National 
Wildlife Refuge System lands in FY97, only 75 acres were restored under 
the Section 10/404 program. Since the policy was developed to reflect 
the informal practices currently used by Service personnel, the policy 
will serve to codify, but not significantly change, agency practice. 
Therefore, the numbers of acres of wetlands restored on National 
Wildlife Refuge System lands as mitigation for activities authorized 
under the Section 10/404 program will probably not change significantly 
with the policy.
    This policy was reviewed under Executive Order 12866. As discussed 
above, only 85 acres during fiscal years 1996 and 1997 were restored on 
national wildlife refuges as a result of compensatory mitigation while 
a more than 130,000 acres were restored. Accordingly, this policy will 
not have a significant economic effect on a substantial number of small 
entities as defined under the Regulatory Flexibility Act (5 U.S.C. 601 
et seq.). Similarly, this policy is not a major rule under 5 U.S.C. 
804(2), the Small Business Regulatory Enforcement Fairness Act.
    In accordance with the Unfunded Mandates Reform Act (2 U.S.C. 1501, 
et seq.), this policy does not affect State, local, and tribal 
governments since it only applies to lands and activities within the 
National Wildlife Refuge System. This policy does not produce a Federal 
mandate of $100 million or greater in any year, therefore, it is not a 
``significant regulatory action'' under the Unfunded Mandates Reform 
Act.
    In accordance with Executive Order 12630, the policy does not have 
significant takings implications. This policy will not result in 
takings since it only applies to lands and activities within the 
National Wildlife Refuge System.
    In accordance with Executive Order 12612, the policy does not have 
significant Federalism effects. This policy will not affect other 
governments since it only applies to lands and activities within the 
National Wildlife Refuge System. This policy will not affect small 
governments.
    In accordance with Executive Order 12988, the Office of the 
Solicitor has determined that the policy does not unduly burden the 
judicial system and meets the requirements of sections 3(a) and 3(b)(2) 
of the Order. This policy does not require any information collection 
for which Office of Management Budget approval is required under the 
Paperwork Reduction Act (44 U.S.C. 3501 et. seq.).
    We have analyzed this policy in accordance with the criteria of the 
National Environmental Policy Act and 318 DM 2.2(g) and 6.3(D). This 
policy does not constitute a major Federal action significantly 
affecting the quality of the human environment. An environmental impact 
statement/assessment is not required. We have determined there are no 
effects on Federally recognized Indian tribes since it only applies to 
lands and activities within the National Wildlife Refuge System. The 
action is categorically excluded under Departmental NEPA procedures 
(516 DM 2, Appendix 1.10), which applies to policies, directives, 
regulations, and guidelines of an administrative, legal, technical, or 
procedural nature; or the environmental effects of which are too broad, 
speculative, or conjectural to lend themselves to meaningful analysis 
and will be subject later to the NEPA process, either collectively or 
case-by-case.

[[Page 49232]]

Final Policy on the National Wildlife Refuge System and 
Compensatory Mitigation Under the Section 10/404 Permit Program

Part 1. What Is the Purpose of This Policy?

    We are establishing a national policy on the National Wildlife 
Refuge System and compensatory mitigation requirements for water 
resource development activities administered by the Department of the 
Army under Section 404 of the Clean Water Act and Section 10 of the 
Rivers and Harbors Act. Our purpose is to provide guidance to our 
personnel that have a decision making role for the use of lands within 
the National Wildlife Refuge System as it applies to the Section 10/404 
program.
    The mission of the National Wildlife Refuge System is to administer 
a national network of lands and waters for the conservation, 
management, and where appropriate, restoration of the fish, wildlife, 
and plant resources and their habitats within the United States for the 
benefit of present and future generations. The Federal government 
established National Wildlife Refuges for the restoration, 
preservation, development, and management of wildlife and wildlands 
habitat; for the protection and preservation of endangered or 
threatened species and their habitat; and for the management of 
wildlife and wildlands to obtain the maximum benefits from these 
resources (50 CFR 25.11(b)). We are currently managing National 
Wildlife Refuge System lands to obtain the maximum fish, wildlife, and 
ecological benefits. Therefore, our management and restoration 
activities will occur regardless of other activities, including those 
authorized under the Section 10/404 program.
    We provide recommendations to the Department of the Army, Corps of 
Engineers, for mitigation using the Clean Water Act, the Section 
404(b)(1) guidelines, the Fish and Wildlife Coordination Act, the 
National Environmental Policy Act, and our Mitigation Policy (January 
23, 1981, 46 FR 7644). These authorities and guidance documents state 
that the biological impacts must be determined by comparing the 
environmental conditions with the project in place (the ``with-project 
conditions'') against the environmental conditions without the project 
in place (the ``without-project conditions''). Under our Mitigation 
Policy, we recommend compensatory mitigation for unavoidable adverse 
impacts to fish and wildlife resources only after project sponsors have 
taken all practicable actions to avoid or minimize the impacts.
    We will continue to restore wetlands and wildlife habitat on 
National Wildlife Refuge System lands independent of off-Refuge water 
resource development activities; therefore, our NWRS restoration 
activities are part of the environmental conditions that would occur 
without the development project authorized by the Section 10/404 
permit. If we allow wetland restoration activities to occur on National 
Wildlife Refuge System lands as compensatory mitigation for off-Refuge 
impacts authorized under Section 10/404, we could be facilitating a 
long-term net loss of wetlands within the watershed. Therefore, we will 
not recommend or allow compensatory mitigation on National Wildlife 
Refuge System lands for activities authorized under the Section 10/404 
program, except as provided in this policy.

Part 2. What Are Definitions Used in This Policy?

    There are numerous technical terms that are used throughout the 
policy. We are providing the definitions to ensure clarity and 
consistency.
    Appropriate. The determination of what level of mitigation 
constitutes ``appropriate'' is based on the comparison between the 
functions and values of the aquatic resources that will be impacted and 
the potential of the proposed creation, restoration, enhancement, and/
or preservation at the mitigation site to replace the lost functions 
and values after subtracting the baseline functions and values of the 
mitigation site.
    Bank sponsor. Any public or private entity responsible for 
establishing and, in most circumstances, operating a mitigation bank.
    Compensatory mitigation. For purposes of Section 10/404, 
compensatory mitigation is the restoration, creation, enhancement, or 
in exceptional circumstances, preservation of wetlands and/or other 
aquatic resources for the purpose of compensating for unavoidable 
adverse impacts which remain after all appropriate and practicable 
avoidance and minimization has been achieved (Federal Guidance for the 
Establishment, Use and Operation of Mitigation Banks (60 FR 58605)).
    Credit. A unit of measure representing the accrual or attainment of 
aquatic functions at a mitigation bank; the measure of function is 
typically indexed to the number of wetland acres restored, created, 
enhanced, or preserved (Federal Guidance for the Establishment, Use and 
Operation of Mitigation Banks (60 FR 58605)).
    Direct effects are caused by the action and occur at the same time 
and place. (CEQ NEPA regulations; 40 CFR 1508.8(a)).
    Director means the Director of the United States Fish and Wildlife 
Service.
    Fish and wildlife resources means birds, fish, mammals, and all 
other classes of wild animals and all types of aquatic and land 
vegetation upon which wildlife is dependent (U.S. Fish and Wildlife 
Service Mitigation Policy, Manual Chapter 501 FW 2).
    Habitat means the area which provides direct support for a given 
species, population, or community. It includes all environmental 
features that comprise an area such as air quality, water quality, 
vegetation and soil characteristics and water supply, including both 
surface and groundwater. (U.S. Fish and Wildlife Service Mitigation 
Policy, Manual Chapter 501 FW 2).
    Indirect effects are caused by the action and are later in time or 
farther removed in distance, but are still reasonably foreseeable (CEQ 
NEPA regulations; 40 CFR 1508.8(b)).
    Minimize means to reduce to the smallest practicable amount or 
degree. (U.S. Fish and Wildlife Service Mitigation Policy, Manual 
Chapter 501 FW 2).
    Mitigation includes: (a) avoiding the impact altogether by not 
taking a certain action or parts of an action; (b) minimizing impacts 
by limiting the degree or magnitude of the action and its 
implementation; (c) rectifying the impact by repairing, rehabilitating, 
or restoring the affected environment; (d) reducing or eliminating the 
impact over time by preservation and maintenance operations during the 
life of the action; and (e) compensating for the impact by replacing or 
providing substitute resources or environments.'' (CEQ NEPA 
regulations; 40 CFR 1508.20(a-e)).
    Mitigation bank. A mitigation bank is a site where wetland and/or 
other aquatic resources are restored, created, enhanced, or in 
exceptional circumstances, preserved expressly for the purpose of 
providing compensatory mitigation in advance of authorized impacts to 
similar resources. For purpose of Section 10/404, use of a mitigation 
bank may only be authorized when impacts are unavoidable (Federal 
Guidance for the Establishment, Use and Operation of Mitigation Banks 
(60 FR 58605)).
    National Wildlife Refuge means a designated area of land, water or 
an interest in land or water within the

[[Page 49233]]

National Wildlife Refuge System, but does not include Coordination 
Areas (National Wildlife Refuge System Administration Act of 1966 (16 
U.S.C. 668dd-668ee: 80 Stat. 927, as amended).
    National Wildlife Refuge System means all lands, waters, and 
interests administered by the U.S. Fish and Wildlife Service as 
wildlife refuges, areas for the protection and conservation of fish and 
wildlife species threatened with extinction, wildlife ranges, game 
ranges, wildlife management areas, or waterfowl production areas, and 
other areas for the protection and conservation of fish and wildlife 
(National Wildlife Refuge System Administration Act of 1966 (16 U.S.C. 
668dd-668ee: 80 Stat. 927, as amended).
    Practicable. Available and capable of being done after taking into 
consideration cost, existing technology, and logistics in light of 
overall project purposes (Federal Guidance for the Establishment, Use 
and Operation of Mitigation Banks (60 FR 58605)).
    Project means any action, planning or approval process relating to 
an action that will directly or indirectly affect fish and wildlife 
resources (U.S. Fish and Wildlife Service Mitigation Policy, Manual 
Chapter 501 FW 2).
    Purposes of the refuge means the purposes specified in or derived 
from law, proclamation, executive order, agreement, public land order, 
donation document, or administrative memorandum establishing, 
authorizing, or expanding a refuge, refuge unit, or refuge subunit 
(National Wildlife Refuge System Administration Act of 1966 (16 U.S.C. 
668dd-668ee: 80 Stat. 927, as amended).
    Restoration. Re-establishment of wetland and/or other aquatic 
resource characteristics and function(s) at a site where they have 
ceased to exist, or exist in a substantially degraded state (Federal 
Guidance for the Establishment, Use and Operation of Mitigation Banks 
(60 FR 58605).

Part 3. What Are the Restrictions Regarding Compensatory Mitigation on 
National Wildlife Refuge System Lands?

    We will not allow compensatory mitigation for habitat losses 
authorized through the Section 10/404 program to be implemented on 
lands and waters within the National Wildlife Refuge System, except 
under limited and exceptional circumstances. The criteria for 
considering compensatory mitigation within the National Wildlife Refuge 
System are as follows:
    (a) The proposed water resource development project, including the 
mitigation plan, is consistent with the Section 404(b)(1) guidelines, 
has undergone all appropriate sequencing for avoidance and minimization 
of impacts, and is consistent with the U.S. Fish and Wildlife Service's 
Mitigation Policy (Manual Chapter 501 FW 2); and
    (b) The proposed mitigation plan supports the mission of the 
National Wildlife Refuge System, is consistent with the purposes for 
which the refuge was established, and is consistent with an approved 
Comprehensive Conservation Plan or other approved management plan(s) 
for the refuge; and
    (c) The mitigation would result in significantly increased natural 
resource benefits when compared to other appropriate, off-site 
mitigation options as determined by the Ecological Services Field 
Office supervisor and the Refuge manager; and
    (d) The mitigation plan is written to ensure we are under no 
obligation to allow compensatory mitigation on any National Wildlife 
Refuge System lands in the future; and
    (e) The Regional Director recommends the mitigation plan to the 
Director for approval.

Part 4. What Are the Restrictions for Mitigation Banks on National 
Wildlife Refuge System Lands?

    We will not allow use of National Wildlife Refuge System lands for 
mitigation banks to compensate for the effects of activities authorized 
by the Section 10/404 program. We may accept mitigation banks as 
additions to the National Wildlife Refuge System under the following 
conditions:
    (a) The mitigation bank is directly related to the purposes for 
which the refuge was established and is consistent with an approved 
Comprehensive Conservation Plan or other approved management plan(s) 
for the refuge, as determined by the Refuge manager;
    (b) The mitigation bank is consistent with the mitigation banking 
agreement as determined by the appropriate Ecological Services Field 
Office supervisor;
    (c) The bank sponsor fully funds the transfer, management, and 
protection of the mitigation bank/project as outlined in the ``Federal 
Guidance for the Establishment, Use, and Operation of Mitigation Banks, 
II. E. Long-Term Management, Monitoring, and Remediation'' (November 
28, 1995; 60 FR 58605);
    (d) The mitigation bank is an established, functioning wetland (or 
other wildlife habitat as appropriate) and the bank sponsor ensures 
that all success criteria have been met in accordance with the approved 
mitigation plan; and
    (e) The bank sponsor withdraws or forfeits all mitigation credits 
before we acquire the bank. The Regional Director may grant exceptions 
to the requirement that all mitigation credits must be withdrawn or 
forfeited prior to acquisition. However, if we accept a mitigation bank 
before all credits are withdrawn, the bank sponsor must remain 
responsible for meeting the criteria in the mitigation banking 
agreement and must remain accountable for the mitigation credits.
    The Regional Director must approve the addition of a mitigation 
bank to a National Wildlife Refuge. If lands within the authorized 
refuge acquisition boundary have been fully acquired, inclusion of a 
mitigation bank must be approved by the Director.

Part 5. What Are the Requirements for Compensatory Mitigation for 
Direct Effects on National Wildlife Refuge System Lands?

    If we allow development activities under a Section 10/404 permit to 
occur on a National Wildlife Refuge that require compensatory 
mitigation, the mitigation must occur on the National Wildlife Refuge 
being directly affected by the activity. However, before we can 
authorize these activities on National Wildlife Refuge System lands, 
the Refuge manager must:
    (a) Determine the activity is compatible;
    (b) Ensure the project sponsor has made every effort to avoid and 
minimize the effects before they request compensatory mitigation;
    (c) Determine the mitigation activities support the mission of the 
National Wildlife Refuge System and are consistent with the purposes of 
the refuge;
    (d) Issue a special use permit, if appropriate; and
    (e) Coordinate with the appropriate Ecological Services Field 
Office supervisor.

Part 6. How Do We Treat Lands Protected by Other Federal Wetland 
Programs?

    Where habitats are protected or restored under other Federal 
programs or activities designed to increase the Nation's wetlands, we 
will not recommend, support, or advocate the use of these lands as 
compensatory mitigation, including mitigation banks, for habitat losses 
authorized under Section 10/404, under any circumstances, during the 
term of the restoration agreement. These other Federal programs and 
activities include easement areas associated with inventory and debt 
restructure

[[Page 49234]]

properties under the Food Security Act, lands protected or restored for 
conservation purposes under fee title transfers, lands protected by a 
habitat management agreement with the Service, or habitats protected by 
programs authorized by the Consolidated Farm and Rural Development Act, 
and the Food Security Act of 1985. After the wetland restoration 
agreement has expired, we will not recommend, support, or advocate the 
preservation of such restored wetlands as compensatory mitigation for 
habitat losses authorized under the Section 10/404 program, except in 
limited and exceptional circumstances.

Part 7. What Is the Scope of the Policy?

    This policy applies to all lands and waters within the National 
Wildlife Refuge System considered for use as compensatory mitigation 
for activities authorized under Section 404 of the Clean Water Act and 
Section 10 of the Rivers and Harbors Act. The policy does not apply to 
existing mitigation projects currently being implemented. However, we 
will review all mitigation agreements currently in effect, and modify 
them as necessary, to ensure consistency with this policy.
    The policy does not apply to public lands administered by other 
government agencies nor does it apply to private lands. However, the 
purpose of the policy is to provide guidance to our personnel when they 
are evaluating proposals for compensatory mitigation regarding a 
proposed Section 10/404 permit. These proposed permits could be for 
development actions occurring on either public or private lands.
    This policy does not apply to threatened or endangered species. The 
requirements for threatened and endangered species are covered in the 
Endangered Species Act of 1973 and accompanying regulations at 50 CFR 
Parts 17, 402, and 424. Under Section 7 of the Endangered Species Act, 
as amended, all Federal agencies shall ensure that activities 
authorized, funded, or carried out by them are not likely to jeopardize 
the continued existence of listed species or result in the destruction 
or adverse modification of critical habitat. Mitigating adverse impacts 
of a project would not in itself be viewed as satisfactory agency 
compliance with Section 7. Furthermore, it is clear to the Service that 
Congress considered the traditional concept of mitigation to be 
inappropriate for Federal activities impacting listed species or their 
critical habitat.

Part 8. What Are the Authorities for This Policy?

    We are establishing this policy in accordance with the following 
authorities:
    Fish and Wildlife Act of 1956 (16 U.S.C. 742(a)-754). This Act 
authorizes the development and distribution of fish and wildlife 
information to the public, the Congress, and the President; and the 
development of policies and procedures that are necessary and desirable 
to carry out the laws relating to fish and wildlife.
    Fish and Wildlife Coordination Act (16 U.S.C. 661-667(e)). This Act 
authorizes the U.S. Fish and Wildlife Service, the National Marine 
Fisheries Service, and the State agencies responsible for fish and 
wildlife resources to investigate all proposed Federal undertakings and 
non-Federal actions needing a Federal permit or license which would 
impound, divert, deepen, or otherwise control or modify a stream or 
other body of water and to make mitigation and enhancement 
recommendations to the involved Federal agency.
    Watershed Protection and Flood Prevention Act (16 U.S.C. 1001-
1009). This Act allows the Secretary of the Interior to make surveys, 
investigation, and ``* * * prepare a report with recommendations 
concerning the conservation and development of wildlife resources on 
small watershed projects''.
    National Environmental Policy Act of 1969 (42 U.S.C. 4321-4347). 
This Act and its implementing regulations (40 CFR part 1500-1508) 
requires that Federal agencies, such as the U.S. Fish and Wildlife 
Service, be notified of all major Federal actions affecting fish and 
wildlife resources and their views and recommendations solicited. In 
addition, the Act provides that the Congress authorize and directs 
that, to the fullest extent possible, all agencies of the Federal 
Government identify and develop methods and procedures which will 
ensure that presently unquantified environmental values may be given 
appropriate consideration in decision making along with economic and 
technical considerations.
    National Wildlife Refuge System Administration Act of 1966 (16 
U.S.C. 668dd-668ee: 80 Stat. 927, as amended). This Act states that the 
mission of the National Wildlife Refuge System is to administer a 
national network of lands and waters for the conservation, management, 
and where appropriate, restoration of the fish, wildlife, and plant 
resources and their habitats within the United States for the benefit 
of present and future generations of Americans. The Act requires, among 
other things, the Secretary of the Interior: to maintain the biological 
integrity, diversity, and environmental health of the National Wildlife 
Refuge System; to develop comprehensive conservation plans for National 
Wildlife Refuges; and not to initiate or permit a new use of a refuge 
or expand, renew, or extend an existing use of a refuge, unless the use 
has been determined to be compatible.

Part 9. What References Are Cited in This Policy?

    Federal Guidance for the Establishment, Use, and Operation of 
Mitigation Banks, II. E. Long-Term Management, Monitoring, and 
Remediation (November 28, 1995, 60 FR 58605).
    U.S. Fish and Wildlife Service Draft Policy on the National 
Wildlife Refuge System and Compensatory Mitigation under the Section 
10/404 Program; Notice of Draft Policy and request for comments (July 
31, 1998, 63 FR 40928-40932).
    U.S. Fish and Wildlife Service Mitigation Policy; Notice of Final 
Policy (January 23, 1981, 46 FR 7644) as corrected.

    Dated: March 12, 1999.
Jamie Rappaport Clark,
Director, U.S. Fish and Wildlife Service.
[FR Doc. 99-23627 Filed 9-9-99; 8:45 am]
BILLING CODE 4310-55-U