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.