Water Rights And The Cannabis Industry

OLCC License Requirements:

Obtaining a license to produce cannabis in the state of Oregon is completed through the Oregon Liquor Control Commission (OLCC).  While the OLCC's licensing process is relatively straightforward, one component of this licensing process consistently causes trouble for applicants.  This problematic component is water rights.

Cannabis is considered a commercial crop by the state of Oregon, and as such, the OLCC requires cannabis producer applicants to submit either:

  1. A water right permit or certificate (issued by the Oregon Water Resources Department);
  2. A statement that water is supplied from a public or private water provider; or
  3. Proof that water is from a source that does not require a water right.

All too often, potential cannabis producers have to put the development of their operations on hold due to a property lacking water rights.

Water Rights Overview:

While source water for the production of cannabis can be hauled in by truck or obtained through exempt methods such as certain rainfall collection methods in fulfillment of OLCC requirements #2 and #3 above, these practices are often expensive, impractical, and inconvenient for producers.  Subsequently, most producers seek to obtain a water right from the Oregon Water Resources Department.  While Oregon water law is highly complex, the water right process can be boiled down to the following process:

  1. Apply For A Water Right Permit: To apply for a water right permit, applicants are required to submit maps, expected water use volumes and rates, have county approval for land usage, and understand water restrictions of the land. Obtaining a permit generally takes 3-4 months if all goes smoothly.  
  2. Certify A Water Right Permit:  Once you obtain a water right permit, you have a set amount of time to prove that you are beneficially using the water you are permitted to use.  At the end of this period of time, you must have a certified water rights examiner document the usage of your water and irrigation system.  If you fail to certify your water right, you can lose your water right permit along with its associated water supply.
Picture:  Documents illustrating the complexity of the water right permitting process

Picture:  Documents illustrating the complexity of the water right permitting process

How Do I Know If I Need A Water Right:

As dictated by Oregon law, all water is publicly owned.  This means that while water may be flowing on, through, or under your property, you are not automatically entitled to use it.  The following are examples of properties requiring a water right:

  • Properties with private wells
  • Properties with natural springs
  • Properties with surface waters (creeks, ponds, etc.)

Due to the complexity of Oregon water law, and the local variability of restrictions and nuances associated with the water right permitting process, attempting to navigate the water right process can seem daunting.  CwM H2O has been successful in helping cannabis producers across the state to obtain or certify water rights, and can help you solve any water related issue you are having.  Call us at (503) 954-1326 if you would like to discuss water related challenges your operation is facing.

Is Your Business at Risk? Is Your Water Right Secure?


What does it mean to "prove up" your water rights?

Are your water rights secure?

It seems like it should be simple. Right?  You need the water, and you have a profitable and beneficial use for the water.  You have taken the time to fill out the paperwork and have received a water use permit from your water agency.  You have built your system over years of hard work.  You may even have been in operation for several years.  It probably feels like you have done everything to meet the criteria in your water right permit.  So are you finished?  Is our water right secure and in good standing with the state?  Can you be certain that creditors will confirm the value of your business and irrigated land in the case of a re-finance or property sale? 

In the scenario above the answer is: NO.  

You have not finished the water right process and your water rights are not secure.  In fact your business is at risk.  You have not yet "proved up" on your water use and have not obtained a Certificate of Beneficial Use (Certificate).  You may even be out of compliance with your permit due to permit condition criteria and time limits that have been forgotten or that seemed insignificant compared to getting the water system built and operational.  If you are out of compliance with any permit condition or time limit, you are at risk of losing some or all of your water rights.  Holding a permit to use water is NOT the last step in securing your water rights. The permit is only a time limited approval for the development of your project and for the initial beneficial use of water requested in the permit.  

In Oregon and Washington you must still complete your claim of beneficial use in the form of a verification report completed by a Certified Water Rights Examiner (CWRE).  A CWRE is a licensed professional third party that completes the "proof" of your water.  The proof is completed via a review of compliance with each permit condition,  the inspection and mapping of your water system, and measurement of water put to beneficial use on site.  The CWRE compiles this technical information in the form of a Claim of Beneficial Use Report to your water agency, be it Ecology in Washington or the Water Resources Department in Oregon.  This final proof of beneficial use is the "proving up" of your water right permit.  Submittal of the CBU Report is the last step that the state needs to issue a Certificate.  And it is the issuing of the Certificate that provides you the security in your water right claim.

In our busy lives it is easy to forget or overlook the permitting details necessary to complete the water right certification process, be it for irrigation, nursery, industrial or municipal use.  Please take a moment to check your water right records.  Confirm that you have completed your claim of beneficial use and received your Certificate. 

If you find that after reviewing your files you remain uncertain of your water right status, a CWRE can help confirm your findings, or quickly assess the status of your water rights for you.  A CWRE has the specific training and experience needed to review any permit conditions and can assist you to complete the permitting process.  If there are legal questions or legal interpretations necessary, a CWRE also can provide recommendations for legal counsel that specialize in water law.

If you have any questions about water rights or water use, give us a call or drop us an email for a free initial consultation on your permit status.  Don't risk your business due to incomplete water rights. 

Waterfront Brownfields Getting New Life in the Pacific Northwest

Heads up cities, towns, and developers! Take another look at that old forgotten former industrial site in your region. If it is on the waterfront it may sit at the end of a rainbow.  Many derelict industrial sites are seeing new life with new industry, others are targeted for destination high end mixed-use development, and still others have venture capital repurposing the sites to sell for environmental mitigation credits. 

Many idle industrial sites across the northwestern pacific coastline are being approached with new vision.  Typical for the Northwest US, many of these sites are former forest products mills, export log yards, or pulp and paper mills.

The exciting part of working on any former industrial site is seeing it come back alive with new vision and energy.  This is happening for larger, 100-acre+, deep port sites due the pressure to export energy resources like coal, liquid petroleum, and LNG.  The Jordan Cove Energy Project is reusing a former lumber mill site as a new energy export terminal.

Other smaller post industrial sites are being eyed for mixed use and sustainable redevelopment. Most of these sites are close to, or inside city boundaries and are less attractive for new industrial development. The Willamette Falls Legacy Project seeks to reconnect Oregon City, Oregon with the Willamette River waterfront and the second largest falls in the United States.  Public Private Partnerships are the key to the redevelopment of these projects.

And still others are being developed for environmental credits to offset waterfront Superfund Site cleanup.  The environmental restoration company, Restorecap, has repurposed the former Linnton Mill site near Portland, Oregon to create salmon habitat for valuable environmental restoration credits.

These sites all have some rough edges due to past industrial use. Sometimes it's a little soil and water contamination, sometimes an old landfill, or an asbestos issue in the building infrastructure itself. Other times it is the complexity of permitting the site at the local, state, and federal levels or changing the land-use for the new vision.  Energy & Water helps guide clients through all these issues to set the environmental and permitting foundation that will prepare the site for redevelopment and make visions of the future a reality.