Project Report:
Conservation Incentives (CI): Increasing the use of market-based approaches to conserve and enhance ecosystem services on private lands.
Purpose
- Explores and develops market-based solutions.

Summary

Under a grant from the Walker Foundation to the American Forest Foundation (AFF) in 2010, project lead Todd Gartner conducted three market-based efforts: 1) convening an Ecosystem Markets Conference; 2) developing an ecosystem market pilot for the Gopher Tortoise in the southeast US; and 3) creating a payment for watershed services program in New England.

In 2010, Todd moved on to lead the conservation incentives and markets program at the World Resources Institute (WRI) www.wri.org but remained lead on the efforts highlighted above. He continues to work in close collaboration with AFF.

Ecosystem Markets Meeting, Raleigh-Durham
Ecosystem Markets Meeting held June 23-25, 2010 in Raleigh, NC and attended by 277 registrants.

Description

(1) The 2010 Ecosystem Markets Conference was co-hosted by AFF and the WRI and was held in Raleigh-Durham, North Carolina on June 23-24, 2010. Building upon successful conferences in 2008 and 2009, which attracted a total of over 375 attendees from conservation non-profits, federal & state natural resources agencies, academia, the private investment sector, forestry, and private tree farms, the event focused on the challenges and opportunities for increasing the use of market-based approaches for conservation on private lands.

The latest 2012 iteration of the Ecosystem Markets Conference was held in Fort Lauderdale, Florida in December, 2012, attracting more than 600 people and thought to be the largest ecosystem markets conference of its kind.

(2) Walker Foundation funding also helped support the development of a Voluntary Gopher Tortoise Habitat Crediting System, focused on Longleaf Pine habitat in Georgia and Alabama. WRI and AFF have been working to prove that with thoughtful preparation and proper management, species like the gopher tortoise can stay off the endangered species list. The project is working with national, state and local partners to put private forestland under sustainable management and protection so that the gopher tortoise and its habitat can continue to thrive. This is a new approach aimed at developing a voluntary incentive-based framework for a non-listed species and will hopefully generate new income streams for private landowners so their lands remain as well-managed forests, providing valuable ecosystem services and timber products.

Under the program, an interested private landowner receives a negotiated payment to conserve, sustainably manage, or restore longleaf pine forests capable of supporting healthy populations of gopher tortoises on his or her property. In so doing, the landowner generates gopher tortoise habitat credits. Eligible landowners include nonindustrial family landowners, industrial forest owners, nonprofit organizations, and potentially state and county-owned lands.

The entity paying the landowner receives the habitat credits in return. The buyer uses the credits to offset the impact on gopher tortoise habitat elsewhere to meet a voluntary net zero biodiversity impact commitment or saves the credits for later use to potentially meet offset requirements if the species becomes listed under the ESA. Other buyers may purchase credits as an investment, under the assumption that habitat credit prices will increase if the gopher tortoise becomes listed. Prospective buyers include the Department of Defense, federal and state departments of transportation, corporations, mitigation bankers, impact investors, and philanthropic foundations.

A gopher tortoise habitat credit is the actual currency that can be bought and sold and reflects a net conservation benefit generated for the candidate species. The number of credits on a parcel of land is determined via a science-based and peer-reviewed method, including the presence and size of a gopher tortoise population, the quality and size of habitat, and the willingness of the landowner to accept additional (i.e., translocated) tortoises to the parcel. To ensure a net conservation benefit, credit offset ratios will be greater than 1:1. For example, at least two compensatory credits may be necessary to offset one credit of impact. Under the current market design, a gopher tortoise habitat credit is perpetual to mitigate the permanent loss of habitat at the impact site. The credit price includes funds to manage and monitor the gopher tortoise habitat in perpetuity, along with a negotiated profit margin for the seller.

The habitat credit is pre-compliance, meaning that it is generated before the species is listed as threatened or endangered. This feature benefits buyers because the cost of a habitat credit may be more expensive once the species is listed, because offsetting impacts would then be mandatory and reactive. This feature benefits landowners because it helps to finance management practices needed to conserve longleaf pine forests, such as prescribed burns and invasive species removal. In addition, pre-compliance habitat credits result in broader environmental benefits by providing more incentives for conserving forests and compensation for actively managing for tortoise habitat, reducing the likelihood that the tortoise populations will further decline and become listed.

The US Fish and Wildlife Service (USFWS) approves the crediting methodology and maintains agreements with buyers and sellers. The USFWS may also provide federal-level predictability to both the buyer and seller. This regulatory certainty allows buyers to preemptively buy gopher tortoise habitat credits that can be used toward offsetting future impacts, if needed, under a scenario where the eastern population of the gopher tortoises is listed under the ESA. The USFWS could also provide assurances to the seller against any future regulation for net conservation actions undertaken that go beyond the habitat credits sold.

For more information - http://pdf.wri.org/forests_for_species_and_habitats.pdf

To date, a peer-reviewed habitat credit metric system has been developed and is currently being field tested. In 2012, a survey was conducted in targeted locations to determine landowner interest in participating in a voluntary habitat credit trading system. Publication forthcoming. Tests of the habitat credit trading process have revealed the need for additional financial and legal framework to provide assurance to potential public and private buyers.

The Gopher Tortoise program initiated with Walker funds is now on a path toward implementation, with expected transactions in 2014, and is serving as a national model with potential replication in 11 western states for the Greater Sage Grouse and 4 states for the Lesser Prairie Chicken. Todd Gartner is building on the lessons learned in the south to help guide the efficient design of these emerging programs. Additionally, this effort led to the U.S. Fish & Wildlife Service publishing an Advance Notice of Public Rulemaking in the Federal Register on the topic of codifying the Gopher Tortoise approach (market-based pre-listing conservation) in Service policy.

The tortoise project was recently highlighted by the Conservation Leadership Council (CLC) as one of the “12 Big Ideas for 2012” – “The Tortoise Can Win the Race for Candidate Species Conservation”
http://www.leadingwithconservation.org/wp-content/uploads/2013/01/CLC_V-Huggins_1.3.13.pdf

Todd and his colleague Laura Huggins, at the Property and Environmental Research Center, were also asked to present their CLC paper at the Fish and Wildlife Service Agency Annual meeting in South Carolina in the fall of 2012.
http://www.youtube.com/watch?v=wKhiBwVNDcM

(3) Walker Foundation funds also supported the Northern Forests Watershed Project working in two watersheds in the northeastern United States. Forested watersheds provide two-thirds of drinking water in the United States as well as recreational opportunities, carbon sequestration benefits, and wildlife habitat. Loss of forests to development threatens perhaps the most important ecosystem service: clean water. To address this emerging issue in private forest management, WRI and AFF, along with key partners, are developing and implementing the project to financially recognize the value of forested watersheds to municipal and other downstream users. The project will provide economic incentives and technical assistance for family woodland owners to restore, enhance, and protect aquatic resources in two critical watersheds in the Northern Forest region—the Crooked River in Maine, which supplies water for the greater Portland area, and the upper Connecticut River in New Hampshire and Vermont, which feeds into the groundwater system for rural areas of the two states.

On August 14, 2010, the White River Partnership, one of the project partners, pioneered the first Landscape Auction to be held in the U.S. in Vermont's White River Watershed. Landowners submitted ideas for "landscape elements" such as songbird habitat, a river access area, and a covered bridge that are in need of conservation. These elements are then auctioned to the highest bidder, who "adopts" the element but does not become the legal owner. Nine private landowners participated in the auction, offering 31 items for adoption. The auction raised approximately $20,000 for the implementation of 30 landscape projects that will benefit clean water, fish and wildlife habitat, and other types of ecosystem and public benefits.

In December 2010, over 50 U.S. natural resource practitioners and experts joined the Northern Forests Watershed Incentive Project's second annual webinar, which provided an overview of the project and covered successes to date. Please use this link for an overview of the project and a link to the webinar: http://www.wri.org/stories/2011/01/using-economic-incentives-connect-us-forests-water-and-communities

In early 2012, WRI published an issue brief which describes analyses in support of emerging payments for watershed services (PWS) programs in two major watersheds in Maine and North Carolina and insights gleaned from work in progress. The three pilot initiatives discussed represent different approaches to establishing PWS programs that protect forests and other green infrastructure elements.
http://pdf.wri.org/insights_from_the_field_forests_for_water.pdf
The project also led to the development of several innovative financing mechanism including the Clear Water Carbon Fund (CWCF) and Clean Water Future (CWF).

The Clear Water Carbon Fund, developed by project partner Manomet Center for Conservation Sciences allows individuals and businesses to simultaneously fight climate change and protect clean water by planting trees along streams and rivers. These trees do four amazing things:

1. Filter sediment and harmful pollutants to keep water clean

2. Shade streams to keep them cool

3. Provide valuable habitat for fish and wildlife

4. Remove carbon from the atmosphere and store it.

Trees purchased through the CWCF funds planting and maintenance of trees near streams and rivers, ongoing monitoring of carbon sequestration, and rental payments to land owners to compensate for lost income (for example, some landowners generate revenue from these areas by harvesting hay). We partner with local land trusts to identify willing landowners and oversee on-the-ground monitoring. http://www.clearwatercarbonfund.org/.

The Clear Water Carbon Fund was originally designed to plant trees in the Sebago Lake watershed in Maine; however, efforts have expanded to cover areas around the Androscoggin River watersheds in Maine and the White River watershed in Vermont. We are working to finalize partnerships to plant trees in the Mad River watershed and Northeast Kingdom in Vermont and the China Lake watershed in Maine.

Clean Water Future was launched as an Internet-based marketplace where individuals, communities, and businesses can invest in projects that protect or enhance natural services provided by private forest and farmland in the Connecticut River watershed. This innovative marketplace connects landowners with people who appreciate and benefit from the services the land offers – providing new opportunities for stewardship and conservation. https://www.cleanwaterfuture.org/.

In 2012, nine projects were completed, raising over $38,000, with at least five additional projects already funded in 2012.

In 2013 WRI pioneered methodologies for valuing ecosystem services and conducting "green-gray" infrastructure analyses using the watershed of Portland, ME as a case study. WRI published its "Green v. Gray" in the Solutions Journal and will publish a more in-depth elaboration of the methodology in the Journal of Environmental Management (forthcoming).

Based on work completed in New England with Walker Foundation funds, local beneficiaries are ramping up investments in the landscape for water resources outcomes. This work also helped to position the World Resources Institute as an expert in the field, advising on projects in FL, NC, OR, WA, MT, CO, Spain, England, Jamaica, Canada and Rwanda. The Walker Foundation provided the seed money to build that program expertise.

Purpose

Ecosystems provide us with indispensable services including flood control, air quality, recreation, wildlife habitats, and drinking water purification among others. Many of these services, however, are characterized by significant market failures that do not reflect their true value. Therefore, with little monetary incentives to protect these services, landowners are often motivated to exploit their natural capital at the risk of ecosystem service decline. In order to offset these market imbalances, and thereby protect the provision of these invaluable services, the CI program was created. The CI has taken the lead in further developing the field of market-based conservation to help private landowners meet both their ecological and economic goals.

The objective of this proposal is to advance the use of market-based approaches and conservation incentives through outreach, education, multi-partner collaboration, on-the-ground incentive-based projects, and networking leadership.

Scope

(1) CI works to shape markets for ecosystem services on the national, regional, and local levels. Through the Annual National Ecosystem Markets Conference, the Community of Practice, the Next Generation of Ecosystem Services and Markets, and myriad other convening and outreach initiatives we conduct, we have galvanized national-level progress on ecosystem market development.

Though currently local and regional in scope, these pilot projects have been designed so they can serve as templates to be expanded and replicated on a national level.

Amount Approved
$15,000.00 on 5/28/2010 (Check sent: 6/16/2010)



Attachments
Ecosystem Markets Meeting, Raleigh-Durham
Participants listen to foresters at the Conference's Field Day to Howell Woods
Adult Gopher Tortoise (Gopherus polyphemus)

Address
1111 Nineteenth Street NW, Suite 780
Washington, DC 20036


Phone
(202) 463-2462
(202) 463-2461 (fax)

Contacts


Ms. Laura Tuel
Vice President of Development, American Forest Foundation

Posted 3/25/2010 10:33 AM
Updated   4/15/2013 12:29 PM



Participants listen to foresters at the Conference's Field Day to Howell Woods
Participants listen to foresters at the Conference's Field Day to Howell Woods

Adult Gopher Tortoise (Gopherus polyphemus)
Adult Gopher Tortoise (Gopherus polyphemus)

 
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