Small oil spills off Louisiana’s coast could help pay for coastal restoration projects as part of a state law signed by Gov. John Bel Edwards.

House Bill 640, the first of its kind in the nation, authorizes the state Coastal Protection and Restoration Authority to set up an oil spill mitigation bank.

Similar to wetland banks, the oil spill mitigation bank would have private investors pay for and build wetland projects included in the state’s master plan for coastal restoration and protection. The state would then assign a number of credits that could be sold to oil companies to make up for environmental damage caused by small oil spills.

Megan Terrell, a legal adviser for the Governor’s Office of Coastal Activities, said the mitigation program would allow for larger coastal projects to be built more quickly and at less cost than the government can accomplish.

Currently, a company may just do a million-dollar project to account for damage, but with the option to buy credits on an already constructed wetland, the impact can be increased while helping meet the state’s coastal restoration goals.

Private companies can build coastal restoration projects more cheaply than the government, partly because of public bid law requirements and the companies don’t need to wait on public funding, she said.

After the project is built and approved by the coastal authority, credits are issued with a dollar value to the private investor. Then, when a smaller oil spill occurs and state and federal agencies determine the amount of damage done to the environment, the oil company can continue with its own restoration projects or buy the credits held by the private investor.

“The state doesn’t put up any of the money,” said Chip Kline, deputy director of the Governor’s Office of Coastal Activities.

The bill isn’t about the BP oil spill money, which reached a final settlement earlier this year. Instead, the bill gives the state additional options of what to do with money oil companies pay to repair damage to natural resources when there is a smaller oil spill along the coast.

If another Deepwater Horizon-type spill were to occur, the oil spill mitigation bank wouldn’t be an option.

The program will start just with coastal wetland construction, but it could be expanded to other areas of the state and for other material like hazardous waste.

“We want to walk before we run,” Kline said.

And, he said, a number of private companies seem to be on board.

“We’ve been approached by firms who are interested and ready to go,” Kline said.

Follow Amy Wold on Twitter, @awold10.