AN ACT Relating to compensatory mitigation; adding a new section to chapter 75.20 RCW; adding a new section to chapter 90.48 RCW; and adding a new chapter to Title 90 RCW.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. The legislature finds that the state lacks a central policy relating to the mitigation of wetlands and aquatic habitat for necessary or unavoidable development. This causes development proposals that rely upon advanced compensatory mitigation or off-site mitigation to take an unreasonably long period of time to develop and implement and to be subject to a great deal of regulatory and permitting uncertainty.

The legislature further finds that mitigation for wetlands and aquatic habitat can be most beneficial for the resource if it is planned before the project's environmental impacts. Advanced compensatory mitigation and off-site mitigation are approaches to providing wetlands and aquatic habitat compensation that offer benefits for natural resources while reducing permitting delays and uncertainty. These resource benefits result from early implementation of wetlands and aquatic habitat improvement actions and from increased flexibility to address wetlands and aquatic habitat from a landscape, watershed, or bay-wide perspective. This approach also offers opportunities to increase biological functions by combining or connecting wetlands and aquatic habitat into blocks of larger size or complexity.

It shall be the policy of the state to encourage, as an option, advanced compensatory mitigation and off-site mitigation that will result in greater environmental benefits than other mitigation options, be appropriate as a means of addressing the impacts of a development project, and provide a means of accommodating necessary or unavoidable development in wetland and aquatic habitat areas. Public infrastructure projects, in particular, could benefit from this type of option.

This chapter does not require the project proponent to use advanced compensatory mitigation or off-site mitigation nor does it change a project proponent's opportunity to pursue project-specific mitigation proposals outside of the context of a mitigation plan.

The legislature authorizes local governments to accommodate the goals of sections 1 through 3 of this act. It is the intent of the legislature that each mitigation plan be consistent with plans and development regulations adopted under the growth management act, chapter 36.70A RCW, and the shoreline management act, chapter 90.58 RCW, and local governments are encouraged to incorporate the goals of this chapter into their development regulations and critical area ordinances.

This chapter shall not be construed to create new authorities for regulating wetlands or aquatic habitat.

NEW SECTION. Sec. 2. The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.

(1) "Advanced compensatory mitigation" means providing compensatory mitigation in advance of known, unavoidable impacts of planned development projects.

(2) "Compensatory mitigation" means the restoration, creation, enhancement, or preservation of uplands, wetlands, or other aquatic resources for the purposes of compensating for unavoidable adverse impacts that remain after all appropriate and practicable avoidance and minimization has been achieved.

(3) "Mitigation" means sequentially avoiding impacts, minimizing impacts, and compensating for remaining unavoidable impacts.

(4) "Mitigation plan" means a document or set of documents developed through joint discussions between a project proponent and environmental regulatory agencies that describe the unavoidable wetland or aquatic resource impacts of the proposed development, and the proposed compensatory mitigation for those impacts.

(5) "Necessary and unavoidable development" means an action that is critical for the maintenance or expansion of an existing infrastructure feature such as a highway, rail line, airport, marine terminal, utility corridor, harbor area, or hydroelectric facility, and is consistent with a land use planning process. This planning process may include the growth management act, chapter 36.70A RCW, or the shoreline management act, chapter 90.58 RCW, in areas covered by those chapters.

(6) "Project proponent" means a public or private entity responsible for preparing a mitigation plan.

(7) "Watershed" means an area identified as a state of Washington water resource inventory area under WAC 173-500-040 as it exists on the effective date of this section.

NEW SECTION. Sec. 3. (1) Project proponents may use a mitigation plan to propose advanced compensatory mitigation and off-site mitigation within the watershed. A mitigation plan shall:

(a) Contain provisions that guarantee the long-term viability of the created, restored, enhanced, or preserved habitat, including assurances for protecting any essential biological and hydrological functions defined in the mitigation plan;

(b) Contain provisions for long-term monitoring of any created, restored, or enhanced mitigation site; and

(c) Be consistent with the local comprehensive land use plan in counties or cities planning under chapter 36.70A RCW, and any other applicable planning process in effect for the development area, such as an adopted subbasin or watershed plan.

(2) The departments of ecology and fish and wildlife may not limit the scope of options in a mitigation plan to areas on or near the project site, or to habitat types of the same type as contained on the project site. The departments of ecology and fish and wildlife shall fully review and give due consideration to compensatory mitigation proposals, including advanced compensatory mitigation and off-site mitigation, that improve the overall biological functions and values of the watershed or bay and accommodate the mitigation needs of unavoidable or necessary development.

The departments of ecology and fish and wildlife are not required to grant approval to a mitigation plan that the departments find does not provide equal or better biological functions and values within the watershed or bay.

(3) When making a finding under this chapter regarding whether a mitigation plan provides equal or better biological functions and values than those that will be lost as a result of necessary or unavoidable development, the departments of ecology and fish and wildlife shall consider whether the mitigation plan provides equal or better biological functions and values, compared to the existing conditions, for the target resources or species identified in the mitigation plan. This consideration shall be based upon the following factors:

(a) The relative value of the mitigation for the target resources, in terms of the quality and numbers of biological functions provided;

(b) The compatibility of the proposal with the intent of broader resource management and habitat management objectives and plans, such as existing resource management plans, watershed plans, critical areas ordinances, and shoreline master programs;

(d) The benefits of the proposal for the entire habitat landscape, considering the benefits of connecting various habitat units or providing population-limiting habitats or functions for target species;

(e) The benefits of early implementation of habitat mitigation for projects involving advanced compensatory mitigation; and

(f) The significance of any negative impacts to nontarget species or resources.

(4) A mitigation plan may be approved through a memorandum of agreement between the project proponent and either the department of ecology or department of fish and wildlife, or both.

NEW SECTION. Sec. 4. The legislature recognizes that many of the aquatic areas of the state contain levels of pollution in the sediments that require remediation through state and federal cleanup laws and programs such as the state model toxics control act, chapter 70.105D RCW, or the federal comprehensive environmental response, compensation and liability act (42 U.S.C. Sec. 9601 et seq.). When cleanup actions are undertaken in contaminated aquatic areas, the habitat function of the aquatic area may be substantially improved. For this reason it is the policy of the state to not require habitat mitigation for the cleanup of hazardous substances under federal or state cleanup laws where the cleanup action plan ensures that the cleanup actions will result in a cleaner aquatic environment and equal or better habitat functions and values. This section shall not be construed to require habitat mitigation for navigation and maintenance dredging of existing channels and berthing areas.

NEW SECTION. Sec. 5. (1) In making regulatory decisions relating to wetland or aquatic resource mitigation, the departments of ecology and fish and wildlife shall, at the request of the project proponent, follow the guidance of sections 1 through 4 of this act.

(2) If the department of ecology or the department of fish and wildlife receives multiple requests for review of mitigation plans, each department may schedule its review of these proposals to conform to available budgetary resources.

NEW SECTION. Sec. 6. A new section is added to chapter 75.20 RCW to read as follows:

When reviewing a mitigation plan under RCW 75.20.100 or RCW 75.20.103, the department shall, at the request of the project proponent, follow the guidance contained in sections 1 through 4 of this act.

NEW SECTION. Sec. 7. A new section is added to chapter 90.48 RCW to read as follows:

When exercising its powers under RCW 90.48.260, the department shall, at the request of the project proponent, follow the guidance contained in sections 1 through 4 of this act.

NEW SECTION. Sec. 8. Sections 1 through 5 of this act constitute a new chapter in Title 90 RCW.