Report: Private Conservation Finance Critical to Restoring the Chesapeake Bay

How Can the Amount of Private Investment in Conservation be Doubled or Tripled Over the Next Decade?

Annapolis, MD – Today, the Environmental Policy Innovation Center and Chesapeake Conservancy released a comprehensive new report, “Private Conservation Finance: The Chesapeake Bay’s Global Lead and How to Expand It.” Private conservation finance is a set of market based and government policy approaches that can deliver conservation outcomes while generating a return for investors. The report examines the programs and initiatives involving private conservation finance in Maryland, Pennsylvania, Virginia and Washington D.C. that are connected to the health of the Chesapeake Bay’s waters and ecosystems.

The report authors estimate that approximately $4.2 billion of private investment has been deployed over the past 20 years to benefit Chesapeake conservation goals (the authors note that this is likely an underestimate). This includes investments in land protection, forest management, wetland and stream banking, nutrient banking, public-private partnerships, pay-for-success contracts, voluntary carbon credits and environmental impact bonds.

“We’ve achieved amazing things through taxpayer- and donor-driven conservation,” said Environmental Policy Innovation Center Executive Director Timothy Male. “Private conservation finance brings new dollars and new strengths to the business of restoring the natural assets we all depend upon. The Bay will be a better place if regional leaders can make it just a little easier to deploy billions from climate- and restoration-focused investors that is available, but not yet hitting the ground here in the Chesapeake,” said Male.

“This report provides an understanding of how the restoration effort in the Chesapeake Bay watershed has capitalized on private investment in the past, and what is needed to advance the effort moving forward. Private investment is of critical importance as commitments are being made to conserve 30% of the Chesapeake by 2030 and meet the 2014 Chesapeake Bay Agreement goals,” said Chesapeake Conservancy President and CEO Joel Dunn. “It is thrilling to be working in conservation at a time when there are so many exciting ways to make progress happen faster, speeding up the scale and pace and effectiveness of Chesapeake restoration.”

From the forward authored by Maryland Delegate Dana Stein and Maryland Senators Jim Rosapepe, Will Smith, and Sarah Elfreth, “If private finance is growing by orders of magnitude, a review like this is helpful to understand what policy changes could allow the region to attract more of that capital to focus on Chesapeake Bay and climate goals. The prize for the state that gets this right is the ability to attract billions more in investment that supports climate and conservation goals, local jobs, and innovation.”

During the 2021 Session of the Maryland General Assembly, Senator Jim Rosapepe sponsored the Comprehensive Conservation Finance Act (SB 0737) with fellow co-sponsors Senators Guy Guzzone, Sarah Elfreth, Mary Washington, Will Smith, Ron Young, and Katie Hester. The chair of the Senate Education, Health, and Environmental Affairs Committee, Senator Paul Pinsky, shepherded the legislation through his committee and on the Senate floor with unanimous votes. There were more than 25 letters of support from state agencies, environmental/conservation nonprofits, and investment and restoration companies. There was no opposition.

The legislation arrived in the Environmental and Transportation Committee of the House of Delegates too late in the Session to be thoroughly reviewed. However, both the chair and vice chair of the House Committee, Delegate Kumar Barve and Delegate Dana Stein, respectively, and Senator Rosapepe, vice chair of the Senate Budget and Taxation Committee, have pledged to introduce the legislation during the 2022 Session for early consideration and hopeful passage.

The bill also included provisions to advance environmental justice goals in Maryland by expanding the use of State Revolving Funds and the Chesapeake and Coastal Bays Trust Fund to support projects in disadvantaged communities and by initiating policy review for a ‘human right to water.’

Conservation Finance-Dependent Government Programs

According to the report, each of these states (and the District of Columbia) have built a lead in conservation finance-dependent government programs in their own ways:

Maryland state agencies and various counties are leaders in the region in deploying approaches that use public funding to buy environmental outcomes after they are produced. Maryland has the strongest forest loss mitigation policy in the region, and many counties have set no net loss of forest goals. It is probably the state with the least voluntary carbon market activity and wetland banking to date.

Pennsylvania has created PENNVEST, a state agency that focuses much like a green bank for water, to coordinate many water infrastructure investment efforts. It is one of only two states in the country with a private water quality revolving fund and has used its state revolving loans to support large-scale forest protection projects.

Virginia has the regional lead in wetland and stream mitigation banking but also has a nationally unique program that has produced an efficient nutrient bank program through private restoration companies protecting and restoring lands to offset from development elsewhere. It is the most active state in the region for voluntary forest carbon transactions and in tax policy that encourages conservation investment.

Washington D.C. has the first program in the country that sets a floor price for water quality outcomes associated with efforts to avoid stormwater impacts from new development. Washington’s water utility was also the first in the country to use an environmental impact bond to attract private investment to pay for green infrastructure. 


  • If the Chesapeake Bay region is going to double or triple the amount of private investment in conservation and restoration over the next decade, there are critical policy gaps where policy changes could make the biggest impact on investment, the Bay and the region’s efforts to grow the economy while fighting climate change.
  • Outcomes-based procurement. Both Maryland and Pennsylvania are considering legislation to make it easier to buy environmental results through government contracting. Expanding such approaches is critical to private investment, which is used to develop projects, restore sites and secure outcomes before they are sold to government buyers.
  • Government accounting of green infrastructure benefits. To make our communities, especially burdened communities, more resilient to climate change, we need to know more about the value of green and blue infrastructure assets and how to increase them, just like we know the value of libraries and road infrastructure. Putting nature on the balance sheets of jurisdictions across the region will drive investment to maximize those values for forest and wetland protection, flood risk reduction, carbon storage and water quality restoration.
  • The region already hosts the nation’s largest public-private partnership for conservation in Prince George’s County, Maryland. New policies are needed that make it easier for local government and state agencies to negotiate partnerships with private companies through contracts that create clear responsibilities and rewards for delivering environmental results, supporting innovative approaches and expanding local jobs.

To read the study in its entirety here.