THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Saturday, September 30, 1995 TAG: 9509300282
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY SCOTT HARPER, STAFF WRITER
DATELINE: CHESAPEAKE LENGTH: Long : 111 lines
Developers are putting wetlands in the bank instead of making the often ill-fated attempts to create man-made wetlands to compensate for areas they've destroyed.
Down a bumpy dirt road, past a wide field of yellow soybeans, the newest and most unlikely bank in Hampton Roads is open for business.
There are no vaults, tellers or even front doors. A solar-powered security fence marks the entrance.
The bank is just a big meadow, separated from the Great Dismal Swamp by a narrow drainage ditch.
But a group of investors, led by Chesapeake-based Vico Construction Corp., is betting about $1 million that this 131-acre tract will become a convenient treasury for local developers tired of jumping through government hoops when building in wetlands.
Called the White Cedar LLC, this scrub-covered meadow represents the first and largest private wetlands bank in Hampton Roads. It's only the second such for-profit endeavor in Virginia, experts and regulators say.
It works something like this:
When fewer than 10 acres of non-tidal wetlands are destroyed during a construction project, and the work is permitted by the Army Corps of Engineers, federal law requires that developers restore what they ruin.
Typically, that has translated into attempts at creating small, man-made wetlands somewhere near the development site. More often than not, however, these efforts fail as the wetlands wither and die under unsuitable conditions.
In the end, the developer loses money and patience with a government program seen as a fruitless hassle. The environment loses one more natural filter and wildlife habitat.
With a wetlands bank, developers still must obtain corps permits and try to minimize destruction. But now, to satisfy restoration requirements, they can simply buy a piece of the meadow from Vico Construction. The transaction is known as acquiring a wetland credit.
When credits for all 131 acres are purchased, the meadow will be donated to the Great Dismal Swamp National Wildlife Refuge, where it will remain pristine for as long as the refuge exists, explained Dave Blevins, a real estate manager for Vico who helped establish the bank.
Robert N. Needham, a North Carolina wetlands specialist hired to oversee the biological health of the bank, describes this approach to wetlands protection as a ``win-win situation.''
``It's a way to take care of environmental concerns and development needs at the same time,'' Needham said during a recent tour of the bank in southern Chesapeake. ``The developer writes a check and is done, and the environment gets a proven wetland. You can't lose.''
Critics, however, charge that wetlands banks make it too easy to build in environmentally sensitive areas, and may actually encourage construction in wetlands.
Further, some opponents have a philosophical problem with a business venture that turns a handsome profit from the destruction of wetlands.
At least one scientist, however, said banks are probably better for the environment in the long run because they preserve large blocks of bona fide wetlands, which are more ecologically valuable than a patchwork of man-made features.
``With a bank, you certainly stand a better chance of being successful from an ecological standpoint,'' said Thomas A. Barnard Jr., an assistant professor and wetlands expert at the Virginia Institute of Marine Science in Gloucester Point.
Wetland banking is not entirely new. Government agencies, including the Virginia Department of Transportation and the city of Virginia Beach, have established banks recently to offset wetlands losses. But these ventures are publicly controlled, and profits are not a motivation.
Vico officials were reluctant to say how much they charge for an acre of credit. But Blevins said investors paid about $10,500 per acre to establish the bank - including money for scientific monitoring and ecological improvements - and that they expect to make at least a 10 percent to 12 percent profit.
Since opening in late August, the bank has sold 27 acres worth of credits to two businesses and is negotiating with two others, Blevins said. Customers include a Chesapeake home developer and the owner of a demolition landfill.
Vico, too, intends to use its bank. The company has set aside 3.8 acres to offset wetlands destroyed in various construction projects in the region, Blevins said.
Needham said Vico also intends to use the bank as a bargaining chip when bidding for construction contracts. The company can offer credits as part of its bid package for jobs in which wetlands will be damaged.
As part of its agreement with the Corps of Engineers, Vico can sell credits for projects only in southeastern Virginia.
The meadow had been converted from a wetland to a farm field in 1962. Back then, the owner built a series of ditches to drain swamp water off the land, which allowed him to farm soybeans, corn and winter wheat.
To obtain government approval, Needham had to return the land to its original state. He and partner Leon Jernigan plugged up the ditches and planted 8,000 juniper trees, an original swamp tree dating back to colonial days.
Hawks, quail and a black bear live on the property, and Needham hopes that once the trees begin to mature, other wildlife will move to the meadow.
``We're doing something unique here,'' he said. ILLUSTRATION: Color staff photo by Richard L. Dunston
Wetlands regulatory Specialist Leon S. Jernigan walks along solar
powered electrical fence that marks the boundary of the White Cedar
LLC private wetlands banks near the Great Dismal Swamp in
Chesapeake.
Color staff map
Area Shown: Site of private wetlands banks.
by CNB