Second in a series.

A little-noticed rule in the North Carolina Farm Act of 2023 could bring noticeable changes to North Carolina’s streams, lakes, reservoirs, ponds and estuaries, and some conservation advocates are worried. 

This new provision limits civil penalties for removing timber in a riparian buffer “in violation of rules applicable to that riparian buffer” from a maximum of $25,000 per violation to the civil penalty being capped at no more than the value of the timber removed.

A quarterly report released last week by the North Carolina Cooperative Extension forestry office shows that the most recent state-wide average standing timber prices range from $7.57 to $41.44 a ton, depending on the species, quality and product.

North Carolina Department of Environmental Quality Deputy Secretary for Public Affairs Sharon Martin explained last week that the agency is incorporating the legislative changes into the enforcement process and each civil penalty is determined based on the specific details of the case and the applicable rules and regulations. 

“The changes may limit the maximum amount of the penalties that can be issued,” she said.

A riparian buffer is a vegetated area with native trees, shrubs and plants adjacent to an estuary, stream, lake or pond that stabilizes the shoreline, provides habitat and filters pollutants. The Division of Water Resources established riparian buffer rules to protect water quality in the Neuse River, Tar-Pamlico River and Catawba River basins and Randleman Lake, Jordan Lake and Goose Creek watersheds.

NCDEQ’s Division of Water Resources finds out about potential violations through complaints from residents or referrals from the North Carolina Forest Service, Martin explained.

“After an investigation, DWR determines the appropriate course of action and amount of civil penalty, if appropriate. If a civil penalty is assessed, severity of impact is one of the main considerations when determining amount,” she said.

This is the same Farm Act, also known as Senate Bill 582, that sparked outcry over a provision that amended how the state defines and protects wetlands. The act passed in late June, despite the governor’s veto that he based on objections over the wetlands provision. 

Southern Environmental Law Center Senior Adviser Derb Carter told Coastal Review Monday that while none of the other provisions in the Farm Act received as much attention as the repeal of the state wetlands protections, this gutting of riparian buffer regulation is also now law. 

With this civil penalty change, you can sell the timber for what it’s valued, then use that money to pay your fine. If you’re allowing trees to be cut and presumably sold – and they can fine you no more than what you receive for cutting the trees — “It’s made the tree protection and buffers pretty much a joke,” Carter said.

Sound Rivers Executive Director Heather Deck said Thursday that she is concerned the lowered penalty will simply become the “cost of doing business.”

Sound Rivers is a nonprofit organization that works to protect the neighboring basins of the Neuse and Tar-Pamlico rivers that extend from the Piedmont to the coastal plain and have sizable drainage areas entirely within the state. Both empty into the Pamlico Sound. 

These two basins require a 50-foot riparian buffer, with the 30 feet closest to the water, or zone 1, required to remain undisturbed, and the outer 20 feet, or zone 2, can be managed vegetation. In the 20 coastal counties, the riparian buffer is measured from the landward edge of the Division of Coastal Management’s wetland boundary, according to NCDEQ.

Deck said that riparian buffers, or treelined waterways, are the most cost-effective tool at keeping our waterways clean and healthy for all uses. 

“Keeping trees on the banks of rivers and streams and creeks is the simplest, most-efficient, cheapest option for protecting waterways and trying to keep them clean,” Deck continued. “Now you basically cut out that financial penalty for enforcement that would have incentivized some not to cut trees.”

The legislature has been for the last decade undermining environmental protections in favor of developers, and this is no different, Deck said.

“This move, in our opinion at Sound Rivers, takes away incentives not to cut trees while also putting a greater burden on the Department of Environmental Quality who is already overworked and under-resourced,” Deck said. This penalty change will result in more buffer violations and tree loss along river and stream banks, putting additional strain on the already understaffed agency. 

Deck recognized that many remove trees to have an unobstructed view of the water, and “you can either have that, or have water that you want to swim and fish in. It’s as simple as that,” she said. “Keeping trees where they’re meant to be along the rivers, creeks and streams is very important. And this legislation will make it harder for us to do that.”

Coastal Carolina Riverwatch Executive Director Lisa Rider agreed that recent legislative actions have caused the state to move backward from “any progress we’ve made to protect the quality of water and life in coastal North Carolina.” The nonprofit advocates for the White Oak River Basin.

Rider added that, as a whole, some of the components to the recent Farm Act will have devastating outcomes with long-term effects on the local economy, just as much as the ecology. 

“Here on the coast, downstream of the cumulative impacts, we are continuing to hear an outcry of concern from local commercial and recreational fishers about the lack of water and habitat protections by the state. We hope that in the future, these coastal voices are heard much louder by decision makers in Raleigh,” she said.

North Carolina Farm Bureau Federation Natural Resources Director Keith Larick told Coastal Review that while the buffer violation penalties language would restrict the amount of the civil penalties, he believes the state can still require the landowner to replant trees to replace those removed.

The provision went into effect July 1, just before the standing timber price numbers for the second quarter of 2023 were released last week by the Cooperative Extension’s forestry office. The quarterly report is through an agreement with Timber Mart-South, a nonprofit that provides trend data for timber.  

This quarter, the statewide average prices for pine pulpwood is $7.57 a ton, pine chip-n-saw is $21.10 a ton, pine sawtimber is $30.02 a ton, hardwood pulpwood is $4.49 a ton, mixed hardwood sawtimber is $28.77 and oak sawtimber is $41.44 a ton. 

Pulpwood is a tree or log used to manufacture paper, absorbent pulp, cardboard, fiberboard and other wood fiber-based products, and are typically the lowest-value product. Chip-n-saw is lumber produced from medium-sized pine trees, and sawtimber is a log or tree large enough and of suitable quality to be sawn into lumber, according to the North Carolina Forest Service. 

N.C. State University College of Natural Resources professor and Department Extension Leader Dr. Robert Bardon said in an email response to questions that these standing timber prices are average prices for all of North Carolina. “This is the price paid to the landowner who owns the timber prior to it being harvested,” he said. 

Bardon, referencing information from Forest2Market, explained that an acre that is clear-cut can produce, on average, about 87 tons of sawtimber-size trees and smaller. If an area is being thinned, or pulpwood-size trees are removed, then it would produce on average about 32 tons an acre. 

If the state uses these recent numbers to determine the civil penalty, an acre of sawtimber would be valued between $2,612 and $3,605, depending on the tree species. An acre of pulpwood-sized pine trees would be valued at $242 and hardwood pulpwood at around $143.

Other provisions

The Farm Act adds to the farm digester system general permit that the “collected gases shall be used as a renewable energy resource as quickly as feasible, but within six months of the collection of the gases, and during that period the gas shall be flared rather than vented.”

Martin with DEQ said that this digester section adds specific guidance on the usage of the collected gases as a renewable energy resource and sets timelines for utilizing the collected gases, which is within six months of starting gas collection.

Larick said that the digester provision allows a farmer some flexibility — up to six months — to line up an outlet for the collected gas while still qualifying for the digester general permit instead of an individual permit. “The condition about flaring the gas for a maximum of six months was added to ensure that the methane was not just vented to the atmosphere in the meantime.”

Also in the Farm Act, the Environmental Management Commission has been directed to withdrawal the aquaculture national pollutant discharge elimination system, or NPDES, general permit that took effect Dec. 1, 2021, for discharges from seafood packing and rinsing, aquatic animal operations, and similarly designated wastewaters and revise the permit to be “substantively identical to the previous general permit.”

Martin clarified that this provision primarily applies to trout farms in western North Carolina.  

Larick reiterated that the section of the Farm Act that requires changes to the NDPES permit was added at the request of trout farmers. 

“The main issue that they had was the expense and time needed for the sampling in the most recent permit. The sampling frequency and number of parameters were increased, and they would be required to conduct composite samples instead of grab samples. The smaller trout farmers were especially concerned about the monitoring provisions,” he said.

Read part 1: Analysis: Farm Act strips wetland safeguards, mitigation

First in a series.

Nearly a month has passed since the North Carolina legislature overrode Gov. Roy Cooper’s veto of the annual Farm Bill that includes a provision boxing in how the state can define and, ultimately, protect wetlands.

Though Senate Bill 582, otherwise known as the North Carolina Farm Act of 2023, covers more than 30 topics hitting on everything from padding buffers by trout streams and upping the penalty for animal waste spilled along state roads, to mandating muscadine grape juice in all public K-12 schools.

But the provision that prompted the governor’s veto and that raised the loudest alarm bells among environmentalists strips state-enacted safeguards and compensatory mitigation for wetlands that have been in place for years by aligning the law with a recent U.S. Supreme Court decision.

In May, the nation’s highest court ruled that the definition of waters of the United States, or WOTUS — the Environmental Protection Agency’s Clean Water Act jurisdiction — applies only to wetlands that have “continuous surface connection.”

“What qualifies as surface conveyance?” asked Norton Webster, treasurer and consultant with the Carolina Wetlands Association and chief strategy officer at Eco Terra, an Atlanta-based environmental services company that specializes in mitigation and alternative energy. “This is what the (Army Corps of Engineers) and the EPA are wrestling now.”

Webster, who works out of Eco Terra’s Cary office, explained that North Carolina has unique wetlands features like Carolina bays and pocosins, which have no inlet or outlet, can be wet for part of the year, and in some cases take up a large part of the landscape in the state’s coastal plain.

“They are wetlands, but some of them may not have federal protection now because they don’t have that surface conveyance,” he said.

The degree to which the wetlands provision’s effect will have on future protection of wetlands in North Carolina will not likely be fully understood until the Environmental Agency and Corps issue a final rule on revisions to the definition of “waters of the United States,” or WOTUS. That ruling is expected to be issued by Sept. 1.

“It’s really difficult at least at this moment to be able to quantify what the exact impacts are because we, unfortunately, really can’t predict the future,” Webster said.

The overwhelming consensus among environmental groups: It’s not going to be good.

Proponents of the Farm Act argue environmentalists are overstating the impact of the wetlands provision.

Mike Carpenter, general counsel for the North Carolina Home Builders Association, told the Associated Press that the provision pertains to isolated wetlands and was “not as gloom and doom and disastrous as our friends in the environmental community would like to believe it is.”

Carolina Wetlands Association Executive Director Rick Savage disagrees.

“Realize it’s more than isolated wetlands,” he said. “It’s a lot more with the (Supreme Court) case. It really is.”

How a new definition may cut mitigation

The North Carolina Department of Environmental Quality estimates that more than half of the state’s wetlands – as much as 2.5 million acres – could lose protection.

Opponents of the wetland provision point out that the state is allocating millions of dollars to create nature-based solutions, including wetlands, to mitigate flooding of riverside communities, yet state lawmakers have enacted a bill that diminishes protecting those wetlands and curbing water pollution.

In his written objection and veto of the bill, Cooper stated that severely weakened wetlands protections will equate to more flooding and dirtier water, especially in eastern North Carolina. According to Savage, 90% or more of the state’s wetlands are east of Interstate 95.

“This bill reverses our progress and leaves the state vulnerable without vital flood mitigation and water purification tools,” the governor wrote.

Nonjurisdictional wetlands, or those not defined under WOTUS, have under state statute been included in the state’s Stream and Wetland Mitigation Program, but that may no longer be the case with the passage of the Farm Bill.

“Mitigation was created to allow for landscape changes, but to try to make sure that the overall quality in those respective areas were not diminished,” said Amanda Mueller, program director of North Carolina State University’s Kenan Institute, Engineering, and Technology Science Climate Leaders Program and a former environmental specialist with DEQ. “That’s come up, especially now with the increased frequency of flooding in a lot of areas. I started to say coastal, but it’s not just coastal any more. So, the services and values of those wetlands, even though they are not continuous with the waters of the U.S. as they’re termed, those services have the potential of being removed by those wetlands not being protected.”

Webster said the answer as to how the state wetland provision will affect the future of wetlands mitigation is simple.

“If a wetland’s not jurisdictional it’s not going to be protected under the Clean Water Act,” he said. “If (wetlands) aren’t jurisdictional and because the state’s protections are gone there will be no mitigation required for those. It’s that simple, unfortunately. The reason it’s going to hurt the mitigation industry is because there’s going to be less mitigation required because there’s going to be less jurisdictional wetlands.”

The state’s compensatory mitigation program is designed to offset what are deemed unavoidable impacts to wetlands by a proposed development.

There are three options for compensatory mitigation: mitigation banks where an applicant can buy credits from an approved bank; in-lieu fees where credits may be purchased through the North Carolina Division of Mitigation Services; and project-specific mitigation, which allows an applicant to mitigate at the project at or off the site.

A mitigation plan must be implemented or constructed before the developer can build.

Mitigation bank sites are the physical acreage in which wetlands can be established, restored, enhanced or preserved.

Sites are vetted through requirements established by a handful of federal agencies, including the Corps and EPA, that look at features including the size of the area, hydrologic sources and watershed management plans.

The system works like a commercial bank, but instead of having a cash asset to loan, mitigation banks loan mitigation credits to sell to anyone who has to offset mitigation debits.

In North Carolina, more than 400 mitigation banks have been approved and “many more” are in the review process, according to Joseph Pitchford, division public information officer.

Nearly 300 of those banks are Division of Mitigation Services sites and 123 are private.

Mitigation must occur within the same geographical service area, or watersheds, as the area in which wetlands are being impacted.

In areas of the state where it is difficult to establish a mitigation bank, particularly small watershed, developers have the option of paying in-lieu fees, when the permittee of a development project pays an in-lieu fee sponsor, such as a public agency or nonprofit organization.

North Carolina has one of the largest and oldest in-lieu fee programs in the country, according to DEQ.

The agency credits the success of the program to Division of Mitigation Services’ partnership with the North Carolina Department of Transportation, which accounts for about 80-90% of mitigation in the state. DOT forecasts an estimate of the department’s mitigation needs and provides that information to the division.

“For mitigation banking we have to have regulation because that’s what defines our market,” Webster said. “And, right now I don’t believe from a political perspective people really see what the value of clean water is because if you look at how dire the environment was back in 1972 when we had the National Environment Policy Act, the Clean Air Act, the Clean Water Act, all these environmental regulations came to be because we were having all these issues and now it’s like, oh well everything’s good, we’re on the status quo, we don’t need to protect these resources anymore. Generally, if you look at the amount of land that has been protected through mitigation and you look at some of the pretty significant wetland banks – there’s some pretty large areas in the coastal region that have been protected and they’ve been protect in perpetuity because there are conservation easements.”