Thousands of acres of riparian forests, wetlands, and shoreline have been protected through the negotiated process of settlement agreements. In this process, a hydropower project owner who plans to obtain a new license in the near future engages all interested parties and stakeholders in negotiations prior to filing a license application with FERC. The parties work together to determine terms and conditions that will be put into the license or actions that the owner will take to protect lands and shoreline. No party will likely achieve 100% of their objectives in settlement, but it is frequently the best forum to work out an appropriate balance with the Licensee rather than all parties waiting for the FERC staff to determine the "appropriate balance." Innovation can also occur, such as proposing longer license terms in return for large scale land protection or other mitigation.
Settlement agreements can be negotiated outside of the FERC licensing process or as part of FERC's alternative licensing process using procedures prescribed under 18 CFR 4.34(i). Typically, a settlement agreement is written to include all agreed upon terms and conditions and signed by all the involved parties. The settlement agreement is then submitted to FERC as part of the license application and part or all of it may be incorporated into the license. FERC may "approve" an entire settlement agreement but will only incorporate into the license those terms and conditions that are within its jurisdiction. Refer to 18 CFR 385.602 for procedural regulations regarding settlement agreements.
The benefits of settlement agreements include more creative methods of protection, more efficient licensing process, and less post-license appeals. Stakeholders have the opportunity to be directly involved in negotiations and are part of the consensus building required to reach a settlement. Try to make settlement agreement terms enforceable under FERC's authority. If aspects of the settlement agreement are outside of FERC's jurisdiction, then the only legal recourse available to stakeholders may be through the state court in the event that any of the parties fail to comply with the agreement.2
The types of shoreline protection that have been achieved and licensed through settlement agreements include:
- Determination of the project boundary prior to the licensing process which enables all parties to know what lands are under the control of the project owner;
- Designation of adequate widths for riverine protection corridors and shoreline buffer zones;
- Determination of land offsets for wetlands and other areas adversely impacted by the project;
2 Many federal natural resource agencies are concerned about such enforcement because of their inability to sue in state court.
- Establishment of funds to finance restoration or replacement of riparian lands and wetlands;
- Development of recreation, land, wildlife, or habitat management plans for areas and species impacted by the project;
- Acquisition of additional lands for shoreline protection;
- Development of conservation easements on project lands; and
- Determination of points of public access for recreation purposes.
3.2.a Term and Perpetual Conservation Easements
Settlement agreements often include conditions for establishing protective easements on lands affected by the hydropower project. This method of protecting lands involves the purchase of land or development rights and the establishment of conservation easements. The hydropower project owner will forgo specific rights to project lands it owns or acquires for this purpose to a qualified conservation recipient such as a public agency, conservation organization, or land trust. The hydropower project owner usually enters into the conservation easement voluntarily as a part of a settlement agreement. Monies to endow the easement holder for its future legal monitoring obligations are also a common part of such arrangements.
An easement may be written to restrict development to the degree necessary to protect the significant resources of the property. For shoreline protection, conservation easements typically prohibit commercial and industrial development and limit or prohibit residential development. Building and roadway setbacks may also be established. Requirements for and limitations on recreational development may also be included.
Perpetual easements are written in perpetuity and are passed on to all subsequent owners of the property. Term easements are allowed only in some states and are written to last a specified period of years. The agency or organization that has been granted the easement is responsible for seeing that the conditions of the easement are met. This often includes monitoring the property on a periodic basis and maintaining written records of the visits. The grantee has the legal responsibility to require the property owner to rectify any violations of the easement. Clearly written, legally binding perpetual conservation easements that specifically outline allowable activities and uses are one of the most effective means of establishing long term land protection, especially when developed through a settlement agreement in which all stakeholders have been involved.
Specific elements of conservation easements that aid in the protection of riparian lands include:
- Preventing development such as large commercial marinas or residential subdivisions around impoundment shorelines;
- Preventing human access to areas of nesting sites, wintering and feeding grounds, migration corridors, and other critical species habitat;
- Prescribing timber harvesting practices near impoundments, rivers, and wetlands; and
- Initiating land management practices that are conducive to particular wildlife and plant species.
3.2.b Trust Funds
It is not always possible to foresee all of the impacts that a particular hydropower project will have on project lands surrounding the impoundment or along river reaches. Many of these impacts may require mitigation or the purchase of additional lands for restoration or replacement. A hydropower project owner may, voluntarily or as the result of a settlement agreement, establish a trust fund for a specified purpose such as land protection to compensate for wetland or wildlife impacts caused by the project and not easily mitigated on-site. The owner may make a lump sum deposit or annual deposits into the fund, which is typically managed by a council made up of the owner and other interested parties. Disbursements from trust funds may be used to provide shoreline protection by:
- Purchasing additional lands for protection and mitigation; and/or
- Financing organizations or agencies to administer conservation easements.
3.2.c Off-site Land Exchanges and Purchases
A settlement agreement may include terms for the protection of lands not included within the project boundary. Off-site land protection may occur when negative impacts on project lands can not be mitigated on-site. The hydropower project owner may agree to protect other lands under its ownership but not associated with the project or the owner may agree to purchase additional lands not associated with the project. This can be an effective means of land protection as long as the lands being exchanged can provide adequate mitigation for associated project impacts. For example, if the project negatively impacts elk wintering grounds within the project boundary, then the project owner may choose to purchase or exchange off-site lands for mitigation. These off-site lands may be exchanged as long as they will benefit the same elk herd. Likewise, wetlands that are destroyed or degraded by project operations could be compensated for by protecting off-site wetlands comprised of similar species of flora and fauna expected to be found on the project lands.
