Private Water Conservation Can Work

Published January 1, 2000

For Oregon and other western states, water is a scarce commodity. Bring together property owners whose livelihood depends on the water running through their property, and environmentalists who view dwindling streams and shrinking waterways as disastrous for fish and other habitat, and tensions arise.

However, according to a study from the Competitive Enterprise Institute’s Center for Private Conservation (CPC), a group in Oregon has found a solution that works for everyone.

The Oregon Water Trust “obtains water rights through gifts, leases, and outright purchases, and then transfers them to instream flows, notes Erin Schiller, a public policy fellow at the Pacific Research Institute in San Francisco and author of a November 1998 case study about the Trust. “Improving these flows into some of Oregon’s rivers and streams not only protects fisheries and aquatic habitat, but also enhances their recreational value and ecological health.”

Schiller explains that “the Trust relies on market exchanges that require voluntary cooperation from both parties involved. Its success depends not only on overcoming this polarization, but on demonstrating that it need not exist: private property rights and environmental protection do not have to be at odds.”

Founded in 1993, the Trust was formed after Oregon changed its water laws to create instream water rights. Until the law was changed, the state did not allow water rights to be used for leaving water instream, because doing so was not considered a “beneficial” use.

The Trust’s mission–to use market incentives to benefit fish habitat–made the Trust appealing to a wide spectrum of groups and individuals, Schiller notes. “Brought together by a common desire to get more water instream, yet representing interests as diverse as real estate, agriculture, and conservation, the founders did not create the Trust because of an ideological devotion to either free markets or environmental protection. Rather, they saw an opportunity for water markets to benefit both fish and property owners, and thus decided to provide the momentum necessary to get that market flowing.”

The success of the Trust was evident in 1994, during its first full year of operation. All four of its short-term goals were met: acquire a few significant rights right away and commit them to instream use; identify itself as a “problem solving, non-ideological group”; cultivate further long-range goals; and develop a fundraising plan to maintain its operation.

Today, the Trust has an executive director, Andrew Purkey, and a five-person staff headquartered in Portland. A Board of Directors of nine individuals representing varied interests maintains control of the Trust. Its funding for acquiring water rights totaled $284,000 between 1994 and 1998, and it has acquired another $370,000 worth of donated water rights. Despite the Trust’s successes, some skeptics still question the need to separate water from the land. Twice, according to Schiller, there has been legislative action to do away with the practice. “While they are not averse to the idea of water rights as private property rights, they view a complete separation of the two as a direct threat to their way of life,” reports Schiller. She adds, “the Trust has no interest in “taking” water away from farmers or ranchers. Rather, the Trust aims to create a cooperative environment in which it facilitates deals that benefit individual landowners and improves fish habitat.”

Schiller concludes by noting that despite the apprehensions of the groups the Trust brings together, they have negotiated deals with over 50 water rights holders in Oregon. Just as vital, she says, is the success the Trust has had in changing attitudes about water and water markets. “By bringing agricultural interests and individual landowners together with environmentalists, the Trust helps pave the way to a more constructive and sensible approach, not only to water policy, but to natural resource management in general, both in and out of Oregon,” she concludes.

For more information

Eric Schiller’s Case Study, “Oregon Water Trust,” is available at the Center for Private Conservation’s Web site at