The U.S. Department of Agriculture, Natural Resources Conservation Service (NRCS), along with the Great Lakes Commission (GLC) announced that the first modern water quality trade between a crop farmer and a waste-water treatment facility in the U.S side of the Great Lakes basin was recently signed.

The trade agreement, signed in the Fox River basin, near Green Bay, Wisconsin, was brokered by the GLC and is the culmination of a multi-year project known as Fox P Trade. During that time, the GLC worked with key stakeholders across the Lower Fox River watershed to test water quality trading as a potential tool to help reduce nutrient loadings into the Lower Fox River, which drains into Green Bay. Brown and Outagamie county land conservation departments partnered to connect the project with local farmers. Funding support was provided by the NRCS through the Great Lakes Restoration Initiative.

Water quality trading is an innovative market-based approach to reducing pollution. Agricultural producers can be non-point sources of phosphorus into the Lower Fox and Green Bay, both of which suffer from multiple pollution problems, including excessive sediment as well as nutrients that cause harmful algal blooms.

Reducing phosphorus use and associated runoff is largely a voluntarily action for farmers. Phosphorus also enters the watershed from industrial facilities and municipal wastewater treatment plants; however, most already have permits that limit how much pollution can be discharged into the water. When these permit holders face high costs to meet their permit limits, water quality trading can provide an opportunity for them to invest in potentially less expensive ways to reduce pollution entering the watershed.

In Fox P Trade, the “P” stands for phosphorus, which will be “traded” between NEW Water, the brand of the Green Bay Metropolitan Sewerage District, and Bob Van De Loo and Sons, Inc. of Kaukauna, WI. NEW Water will compensate Bob Van De Loo and Sons for use of cover crops, conservation tillage, and buffers to reduce phosphorus coming off his farm. A portion of the pounds of phosphorus reduced will be counted as actual credits for trading – thus ensuring that the trade results in water quality improvements.

“Federal and state agencies realize that a variety of innovative approaches are needed to help reduce pollution in the Lower Fox River and Green Bay,” said Jimmy Bramblett, NRCS State Conservationist for Wisconsin. “Leveraging federal and state resources expands water quality improvements, and increases long-term conservation adoption by landowners.”

“Water quality in the Lower Fox and Green Bay is everyone’s problem, and farmers want to be part of the solution,” said Bob Van De Loo. “This pilot trade gives us more options to protect the river and the bay and keep treatment costs low for our customers,” said Tom Sigmund, Executive Director of NEW Water. “We are thankful to the Great Lakes Commission who worked tirelessly to bring this trading opportunity to NEW Water.”

The GLC submitted the plan for this trade to the Wisconsin Department of Natural Resources (WDNR) for review.  Feedback will provide a clearer roadmap for NEW Water and other permit holders in the Lower Fox River Watershed for future water quality trading.

The Lower Fox River is subject to a Total Maximum Daily Load (TMDL) that sets limits on the amounts of phosphorus and sediment that can go into the river, and its tributaries, without violating water quality standards. “Before Fox P Trade, trading had never been done in a watershed facing restrictions under a TMDL,” said Pat Stevens of the WDNR, who also serves on the Great Lakes Commission. “Fox P Trade has demonstrated how water quality trading can be a tool in the toolbox to help reduce pollution in TMDL watersheds and provide a less expensive way to get reductions compared to additional controls at a facility.”

“We are proud to have been able to work with farmers, facilities and watershed stakeholders to design and test a water quality program that can work for the Lower Fox River Watershed well into the future,” said Victoria Pebbles, GLC Program Director who led the initiative. “Lessons learned from this work are already being applied to other parts of the Great Lakes basin, including in a current to explore water quality trading as a tool to reduce phosphorus in the Western Lake Erie basin.”

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