Agenda Item No.: E.4.h. Wetlands Conservation Policy Recommendation: That the February 2, 2005, Planning and Development report 2005PDP016 be received for information. Report Summary This report responds to the second part of a motion passed at the July 27, 2004, Executive Committee concerning Alberta Environment’s practices regarding compensation that the Province receives from wetlands drained in Edmonton. Previous Council/Committee Action At the July 27, 2004 Executive Committee meeting, the following motion was passed: 1. That the July 27, 2004, Planning and Development report 2004 PDP103 be received for information. 2. That Administration prepare a report on the compensation that the Province receives from wetlands sold in Edmonton to ensure that these funds directly benefit the City of Edmonton. 3. That the Mayor send a letter to the Hon. Lorne Taylor, Minster of Environment, requesting information regarding compensation that the Province receives from wetlands sold in Edmonton. Report This report addresses the second part of the July 27, 2004, Executive Committee report referenced above regarding the compensation that the Province receives from wetlands drained in Edmonton and what Administration is doing to ensure that these funds directly benefit the City of Edmonton. Mayor B. Smith sent a letter to Routing: Delegation: Written By: February 2, 2005 File: 2005PDP016 Hon. Lorne Taylor, Minister of Environment in August 2004 that addresses the third part of the Executive Committee motion. Provincial Wetland Policy: Alberta Environment is presently preparing a Provincial Wetland Policy. It is expected that a draft will be issued to the public in late 2005 or early 2006. The intent of the proposed policy is to have “no net loss” of wetlands in Alberta. It is important to note that although the proposed Provincial Wetland Policy has not been approved, aspects of the policy have been applied in Edmonton since 1997. Alberta Environment has been using three criteria in order of priority to assess the merits of applications for wetland drainage: i) avoid wetland impacts if possible, ii) if avoidance is not acceptable, then mitigate the wetland impacts, and iii) if avoidance and mitigation are not options, provide financial compensation for the wetland restoration elsewhere in the watershed to achieve “no net loss” of wetlands in accordance with a compensation formula. The compensation formula requires applicants to provide money to a third party to restore wetlands at another location in the watershed in a provincially sanctioned mitigation “bank.” If the location is adjacent to the drained wetland, the compensation requirement might be for a wetland area twice the area of the drained wetland. If the compensation is applied to a wetland in the same watershed 100 km away, the requirement might be 10 to 14 times the area of the drained wetland. The applicant selects the compensation solution based on the Executive Committee L. Benowski/R. Caldwell/G. Pearsell G. Pearsell Planning and Development Department (Page 1 of 3) E 4 h Wetlands Conservation Policy formula provided by Ducks Unlimited on behalf of Alberta Environment. Alberta Environment has proposed that wetland mitigation “banks” be established in the province to accept compensation money from wetland drainage approvals as a way of streamlining the process. Alberta Environment is allowing Ducks Unlimited’s past wetland conservation projects to serve as provincially sanctioned mitigation banks. It is their hope that others will step forward to establish other banks. Edmonton’s Experience: Alberta Environment has provided Administration with information regarding wetland approvals within Edmonton for the period between 1997 and 2003. This wetland drainage information can be considered in two categories: i) approvals with compensation within the City of Edmonton, and ii) approvals with compensation outside of Edmonton. In general, applications for wetland drainage are approved by Alberta Environment because they feel that negative impacts are difficult to avoid or mitigate in Edmonton, and compensation outside of Edmonton is considered to be a better conservation strategy from a provincial perspective. Administration does not share this view. There have been 15 approvals issued with compensation within Edmonton between 1997 and 2003. Two of approvals were granted to a third party using City stormwater management lakes for compensation without the knowledge of Administration. There have been seven approvals issued with compensation provided outside of Edmonton. All compensation was provided to Ducks Unlimited Canada. Two of the compensation cases involved wetland drainage in the same neighbourhood as the City’s Schonsee wetland conservation project for Environmentally Sensitive Area NE8084. Administration has made proposals to Alberta Environment to have some Environmentally Sensitive Areas or constructed wetlands designated as mitigation banks whereby compensation money would be kept within the city instead of flowing out of the city to rural municipalities. To date, Alberta Environment has not been receptive to these proposals. Administration’s Approach to Change Current Practice: The Senior Management Team, Natural Areas Policy Implementation Committee, and the Office of the Conservation Coordinator have been working on this issue in 2004 and are working with a coordinated approach to convince Alberta Environment to change their practices as follows: Amend the compensation formula so that it is not advantageous for a drainage applicant to compensate for wetland losses outside of Edmonton. Disallow the use of City of Edmonton stormwater management facilities by third parties as a viable compensation option without Administration’s consent. Designate several existing wetlands within Edmonton as mitigation banks to accept compensation money for wetland (Page 2 of 3) Wetlands Conservation Policy losses in Edmonton. Designation of a mitigation bank would help to pay for conservation lands acquisition and restoration. It would provide cost benefits to drainage functions such as water quality enhancement and flood control. Make Alberta Environment aware that the drainage of wetlands in Edmonton with compensation outside of Edmonton is adding extra costs to the City to provide additional water quality enhancement and flood control that the wetlands provided. Keeping the compensation money in Edmonton to conserve other wetlands would help to offset this cost. is expected that the Conservation Coordinator will sit on Protect Team. Others Approving this Report Current Status of the Provincial Wetland Policy: Recently, Alberta Environment has rethought their approach outlined in its unreleased Provincial Wetland Policy. Alberta Environment has decided to consult affected stakeholders throughout the province and is using the new Alberta Water Council as a forum for these discussions. The City Manager sits on the Water Council representing the interests of large urban municipalities. A Working Committee of the Alberta Water Council has been formed to develop a consensus based process to find agreement on a new provincial wetland policy. The Conservation Coordinator has been appointed to sit on the Working Committee. The first meeting of the Working Committee was January 13, 2005. A Project Team will be assembled later in 2005 to examine the technical aspects of the proposed policy and recommend changes. It (Page 3 of 3) W. D. Burn, General Manager, Asset Management and Public Works Department D. Kloster, General Manager, Community Services Department