Abstract: In this paper we review the evolution of the wetlands credit sales program developed to support the federal wetlands permit program. Then, we explain how the regulatory rules governing the overall permit program, as well as specific rules governing credit sales, have prevented the development of robust markets in credit buying and selling. Based on this review, we identify an alternative institutional structure that would apply marketlike principles to expand the quantity of and lower the prices of credits while ensuring that wetlands credit sales help move the nation toward its goal: no net loss of wetlands acres and functions.

Abstract: Habitats and the services they provide are part of our nation’s portfolio of natural capital assets.As for many components of this portfolio, it is difficult to assess the value of their services, and thiscomplicates regulators’ investment decisions, especially when the alternative use is measurable. Theprincipal objective of this report is to suggest possible strategies for the National Marine Fisheries Service(NMFS) as it applies economic analyses and arguments in support of the agency’s trustee responsibilities.Many approaches are possible, and as we discuss, the “right” strategy will depend on the questions asked,the resources available, and the agency’s role in the consultation process. We discuss in detailbioeconomic modeling and ecosystem indicator approaches to habitat value assessment. Although theapproaches are discussed independently, multiple tools could be used simultaneously across differentregions or within the same region on different aspects of one consultation.