The Nature Conservancy in Delaware - DNREC FY09 Budget, 11/15/2007

November 15, 2007

Ms. Jennifer Davis
Director, Office of Management & Budget
Governor’s Office of the Budget
540 S. DuPont Highway, Suite 5
Dover, DE 19901

Mr. John A. Hughes
Secretary
Delaware Department of Natural Resources and Environmental Control
89 Kings Highway
Dover, DE 19901

Re: DNREC FY09 Budget Hearing Comments from The Nature Conservancy

Dear Director Davis and Secretary Hughes:

Thank you for the opportunity to submit written comments on behalf of The Nature Conservancy with respect to the Delaware Department of Natural Resources and Environmental Control’s (DNREC) proposed FY09 budget. We would appreciate your consideration of two funding items outlined below as you prepare for the Governor’s budget submission to the General Assembly.

Program Priorities & Recommended Funding Levels

Regional Green House Gas Legislation – Allocation of CO2 Allowances

Division of Soil and Water Conservation (Coastal Management Program)
• Delaware Bay benthic habitat study $ 500,000

The Delaware Chapter of The Nature Conservancy strongly encourages Governor Minner and the
145th General Assembly to adopt Regional Greenhouse Gas legislation in Delaware during the upcoming legislation. This bill represents our top legislative priority and also has implications for creating a new revenue stream to the state. In adopting this legislation, we encourage inclusion of the following provisions:

- A 100 percent auction of RGGI allowances under which the majority of allowance auction proceeds would fund energy efficiency and conservation and renewable energy development.

- Investing up to 10 percent of allowance auction revenues for climate change adaptation projects. This might include modeling and mapping sea and Delaware Bay water-level rise and identification of habitat migration zones, forestland and coastal land preservation, ecological management in anticipation of climate change impacts such as sea-level rise, and integration of climate change into state Comprehensive Wildlife Conservation Strategies.

- The Conservancy supports expanding the types of offsets that sources can use to meet the emissions limits to include sustainable forest management and conservation.

Delaware could generate annual revenues of $3.8M to $75.6M through auction of credits depending on the percentage allocation and price per ton of CO2 equivalents.

The Nature Conservancy also encourages your consideration of a $500,000 appropriation to the Delaware Coastal Management Program to initiate a major cooperative benthic habitat study of the

Delaware Bay. The 2006 report from the U.S. Commission on Ocean Policy highlighted that, although we have made many strides in protecting and restoring coastal habitats such as wetlands, the undersea habitat of our ocean and estuaries has received little attention. Governor Minner’s response to the commission report stressed that increased consideration must be given to conservation and restoration of benthic habitat. Due to the difficulties in mapping and assessing these habitats, they are often overlooked. This type of data is necessary to move toward ecosystem-based management of our ocean and coastal resources, as the Commission on Ocean Policy Report recommends. Additionally this type of mapping will better assist the State in its response to oil spills that may occur in the Delaware Bay and Estuary.

Sincerely,

Roger L. Jones, Jr.
State Director

Enclosure
cc: Mr. Michael Scuse, Secretary, Delaware Department of Agriculture