Category: Mitigation Banking

FAQ: Can course become residential or mitigation bank land under CWA?

FREQUENTLY ASKED QUESTIONS: We are regularly asked, can this course become residential or commercial development land or mitigation bank land under the Clean Water Act? What can it be?

The short answer is NO because there are several key factors at play.

THE BASICS: The historical zoning is Agricultural with special use permits for operation. The Fallbrook Golf Course consists of 116 acres made up of 9 tax assessors’ parcels but it is only 2 legal parcels. Six of the 9 tax assessors’ parcels hold Special Use Permits allowing use as “Recreational-Vacant Land” and three parcels as “Golf Course.” Any change in use can trigger the necessity of acquiring a new permit, a zoning change and/or subdividing the property in compliance with the Subdivision Map Act.

RESIDENTIAL OR COMMERCIAL DEVELOPMENT: It is very difficult to change Agricultural Zoning to high density residential or commercial zoning. Even if rezoning to Residential could be accomplished, the San Diego General Plan restricts development to 4, 8 or 16 acres per house, depending on slope. Add in setbacks for riparian and flood plan areas, roads, utilities and the various easements that exist on the property and this project is quickly rendered financially unviable. Because the golf course is located in a flood plan in low density, semi-rural Fallbrook, increasing building density or height limits requires changing the San Diego County General Plan, an onerous process with no guarantee of success.

There are far better properties available for development for far less money in North San Diego County.

MITIGATION BANKING: For mitigation bankers seeking limited acreage on the back nine near the semi-dry creek for developing into fenced-off mitigation bank land (under the Clean Water Act) purposes, the property must be subdivided first and its zoning and use changed from Open Space/Recreational to a fenced, closed property. Without community support, this change is highly unlikely to receive County approval since both the County Plan and the Fallbrook Community Plan both contain language protecting Open Space/Recreational land. Additionally, in its current form, the Subdivision Map Act requires any buyer to acquire the entire back nine parcel which also includes the parking lot and restaurant/bar. Add in that the location is not prime for mitigation banking purposes because there is little above-ground water in the area. Therefore, this purchase does not pencil out for a mitigation banker who is interested in wetlands to offset loss of wetlands in other parts of the County.

Again, there are far better properties available for mitigation banking for far less money in North San Diego County. However, this is an area that a new owner might explore since mitigation land banking has been done in conjunction with working golf/recreational/agricultural properties. Budget 5 years for paperwork, another 5 for enhancement before seeing non-repeating income from the sale of mitigation land banking credits.

In summary, due to restrictions in San Diego County General Plan, the Subdivision Map Act, and simple economics, golf or agricultural use is a great future for the property. Add in wedding venue, combined with a restaurant, bar and a new owner would have a viable business model. Adding conservation easements to the property will generate tax benefits to the owners while delivering a wonderful gift to the community.

For the right buyer, this is an amazing opportunity to buy!

CONSERVATION EASEMENTS/CONVENANTS DELIVER ADDITIONAL BENEFITS TO THE COMMUNITY AND A NEW OWNER:  Conservation easements/covenants are commitments to forego certain potentially valuable development rights in return for tax benefits to the owner. This additional layer of assurance to the community means that the property will never be developed. See this link on conservation easements/covenants. We are also happy to connect you to experts in this area. Just ask! Thank you!

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Meanwhile, when evaluating the potential earning capacity of Fallbrook Golf Course as a golf course, it’s worth noting the AVERAGE HOUSEHOLD INCOME in the area. These, of course, are an indicator of disposable incomes:

FALLBROOK: Average household income: $86,220. (For more info.)

GIRD VALLEY: Average household income: $151,575. (For more info.)

BONSALL: Average household income: $113,910. (For more info.)

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Mitigation Banking Resources

Mitigation Banking Factsheet, created by Section 404 of the CWA. Environmental Protection Agency.

The Presidential Memorandum and Interior Department Policy on Mitigation: Their Content and Implications. By Thomas Jensen, Bailey Schreiber and Sandra Snodgrass, Holland & Hart, Nov. 9, 2015.

Public access is banned on mitigation bank land. “The California multi-agency Project Delivery Team developed this general outline to assist in the development of the Long-term Management Plan for mitigation banks. (Template Version Date: May 2008)” See p.10, “B. Security, Safety, and Public Access: The Bank will be fenced and shall have no general public access, nor any regular public or private use.”

Project Manager for the San Luis Rey Downs Golf Course mitigation land project, Shanti Abichandani Santulli, Acting Team Lead, Carlsbad Field Office, South Coast Branch, U.S. Army Corps of Engineers, Regulatory Branch, Shanti.A.Santulli@usace.army.mil, (760) 602-4834, explains:

“To answer your question regarding if mitigation bank land would be accessible to the public for hiking and other uses, in short, areas preserved for compensatory mitigation for impacts associated with Corps-authorized permits (per the Corps current regulations on mitigation) should be preserved for habitat/aquatic resource conservation purposes and preservation mechanisms required for these sites should prohibit incompatible uses. These incompatible uses can include hiking and other recreational uses. However, there are mitigation sites that have trails and other recreation uses alongside the conserved mitigation areas, so such uses can be considered directly adjacent to a mitigation area, but not within the preserved areas. I hope this helps clarify.”

Panel defends, explains mitigation, conservation land. By Debbie Ramsey, The Village News, Feb. 25, 2016.

There’s a lawsuit in San Diego that began in 1951. Fight for water between military and Fallbrook spurs county’s oldest, active civil case. By Kristina Davis, San Diego Union-Tribune, Feb. 20, 2016.

San Luis Rey Wetland Restoration / Mitigation Bank Project. Final Mitigated Negative Declaration. Prepared by HELIX Environmental Planning for City of Oceanside Planning Department, June 2014.

“‘Mitigation bankers’ see profit in turning developed land back into natural habitat.” Looks at San Luis Rey River Valley, including info on the golf course. KPBS, Feb. 12, 2015.

The Singh family was reluctant to let go of even this small part of the land it has farmed for so long. But Brian Monaghan, vice president with Wildlands, said the company was able to offer a strong incentive, because restoring wetlands generates millions of dollars in mitigation credits.

“My guess is that they’ll probably be about half a million dollars per acre, so not cheap,” he said. “So we would sell these wetlands to third parties that have permits from either the Army Corps or the California Department of Fish and Wildlife. That could be your local highway department, it could be the City of Oceanside, it could be a developer who’s developing somewhere here in the region.”

Monaghan would not reveal how much Wildlands, a private, for-profit company, offered the Singh family for the land. Krishna Singh, the owner’s son, said it was a difficult decision for the family, but they support the goals of the mitigation bank, and agreed to grant the company an easement for the project. The farm will continue to grow vine-ripe tomatoes in the fields around the recreated riverbed.

Opinion: Why locals shouldn’t be upset over a mitigation bank moving in. By William Coleman, Ecosystem Marketplace, Dec. 30, 2014. NOTE: includes chart showing average price per acre for mitigation credits/land in San Diego County is booming, at $380,000/acre!

“Golfers bristle as San Luis Rey ‘Drowns’. Bonsall’s San Luis Rey Downs could be turned into wetlands.” San Diego Union Tribune, Feb. 16, 2014.

The immediate demand for mitigation land is expected to come in part from state road-widening projects and from San Diego Gas & Electric’s work on transmission lines.

The U.S. Marine Corps Base Camp Pendleton has also indicated it may need a number of credits for wetland, stream, and species mitigation.

Over the long term, the company said it expects overall demand for credits to grow as cities such as San Marcos and Escondido expand and the local real estate market improves.

New paper offers guidance on wetland mitigation banking risks. By Kelli Barrett, Ecosystem Marketplace, Jan. 23, 2014.

Legislation would steer DOT wetlands money to private industry with poor track record. By Craig Pittman, Tampa Bay Times, Feb. 8, 2012.

“Mitigation banks” for wetland conservation: A major success or an unmitigated disaster? By Shelley Burgin, Wetlands Ecology and Management, February 2009.

Special Report: Vanishing Wetlands. St. Petersburg Times [Florida], 2006. Extensive investigative series on booming gold rush in mitigation land banking, fueled by unlimited tax dollars and the Clean Water Act agency Guidance. Includes criticism of land banks selling credits for land that is dry, fraud, lack of oversight.

Wetland mitigation banking. By Robin Meadows, Ecosystem Marketplace, 2005.

Conservationists’ biggest criticism of mitigation banking is that it has historically emphasized acreage over ecosystem services. Notably, wetland mitigation was slammed for failing to meet the federal goal of no net loss of wetland function by the 2001 National Academy of Sciences report Compensating for Wetland Losses Under the Clean Water Act, which found that “the area of a wetland type is often used as a proxy for wetland functions” and cautioned that “the establishment of wetland structure does not necessarily restore all the functions of a wetland ecosystem.”

Wetlands. USDA Natural Resources Conservation Service.