Crossover Assets™
Investing in Environmental Assets and Biodiversity

Habitat Conservation Banks

Building on the success of mitigation banking in the mid-1990’s and coupled with the looming threat of continued critical habitat loss and fragmentation, California pioneered the development of the first conservation banking market. Conservation banking is modeled after Section 404 mitigation banking and is intended to offset adverse impacts to federally listed threatened and endangered species and their corresponding habitats as mandated under Sections 7 and 10 of the Endangered Species Act (“ESA”) of 1973. Unlike smaller, individual mitigation actions implemented under the ESA, conservation banking is typically viewed by the U.S. Fish and Wildlife Service and state wildlife agencies as a means of establishing larger preserves and enhancing habitat connectivity, which is essential to the recovery of protected species.

Conservation banks operate under the same basic principles as mitigation banks with a few notable exceptions. While the primary goal of mitigation banking is to replace the ecological functions of wetlands and other jurisdictional waters that have been impacted from permitted activities, the primary goal of conservation banking is to offset adverse impacts to listed species and their critical habitat. This is typically accomplished through the preservation of existing habitat and, in certain cases, the restoration or enhancement of degraded lands with significant potential for providing critical habitat. In all cases, conservation banking lands must provide long-term conservation value to mitigate the loss of isolated and fragmented habitat that has minimal long-term value to listed species. Through a permitting process governed by state and federal regulatory agencies, a conservation “bank” is created and awarded credits based on the conservation benefits to listed species. These credits are then sold to public or private entities adversely impacting critical habitat within the bank’s designated service area.

The most current national survey of conservation banking by SpeciesBanking.com estimates that a total of 126 conservation banks have been established in 11 states, which have effectively protected more than 90 listed species and approximately 235,000 acres of critical habitat. Additionally, total credit transactions within the market are estimated at approximately $2 billion per year and growing annually.

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