The US Property and Environmental Research Centre has shown how assigning property rights to protected species helped turn a hazardous landfill into a conservation bank that provides valuable habitat for endangered species.
The US Endangered Species Act often makes developers offset the impacts of a development on endangered species. Historically such offsets have generally involved the enhancement and conservation of nearby habitat but these mitigations have proven to be time-consuming, expensive, and do not guarantee success.
Entrepreneurs have come up with a potentially better approach. They create a for-profit conservation bank to take over a developer's liability to mitigate specific biodiversity impacts. The conservation bank then purchases land to be conserved and managed to benefit of the species in question. The bank ensures that this benefit is sustained over the long term by incorporating a conservation easement into the land title and setting up an endowment to pay for habitat maintenance and monitoring.
The US Fish and Wildlife Service issues credits to conservation banks for conservation or restoration of specific habitats. The banks can sell the credits to developers who thereby avoid having to do the conservation work themselves. For several years this model has helped mitigate biodiversity impacts associated with wetlands and creeks.
Wetlands Research Associates (WRA) — a leading developer of conservation banks — has further developed the biodiversity conservation model with its redevelopment of Ridge Top Ranch in northern California—see the photo above. The 301-hectare cattle property is now valued at A$24 million largely because of its wildlife credits. Prior to redevelopment, it was a net liability due to its proximity to a hazardous waste dump.
The wildlife credits flowed from the introduction of an endangered frog species and habitat protection for a species of butterfly at Ridge Top Ranch, which WRA had identified as commercial opportunities prior to redevelopment.