EWEB envisions the development of an investment mechanism that makes payments for ecosystem services (PES) as a way to maintain and improve water quality within the McKenzie River Watershed, Eugene’s sole source of drinking water. The public name for this concept is the Voluntary Incentives Program. Under the envisioned Voluntary Incentives Program (VIP), EWEB will provide annual dividend payments to landowners for the valuable services their properties provide including water filtration and purification. These dividends recognize the value of the natural capital provided by these lands and their downstream benefits to the residents of Eugene. A fund with sustainable financing will be established to support the dividend payments and the infrastructure necessary to operate the Voluntary Incentives Program. Financing will come from a variety of sources but could be initially endowed through existing water funds (under existing rate structure) or another utility funding mechanism. Additional possible financing sources other than EWEB include corporations, a voter approved bond measure, development impact fees, and state and federal mitigation programs. \ud EWEB will establish a stewardship boundary identifying riparian forests and floodplains that are eligible to enroll in the VIP. Participation is open to private landowners, local governments, and non-profit organizations that own land within the designated boundary. Based on EWEB’s preliminary analysis, an estimated 6,500 acres of riparian and floodplain areas along the McKenzie and major tributaries are eligible to enroll. Land within the stewardship boundary will need to meet a threshold in order to receive payments. This threshold will be determined by adapting existing riparian forest and wetland habitat standards and definitions from NRCS, USFS, Defenders of Wildlife and other entities to establish the criteria for participation in the VIP.\ud Appropriate infrastructure is essential to implement and run the incentives program: critical tasks include managing the fund, making payments to VIP participants, assessing the quality of land enrolled, negotiating agreements, monitoring properties and verifying compliance, and educating and communicating with the community. The VIP will rely upon a coalition of existing organizations, which will form a watershed investment district (WID), to provide this critical infrastructure, without which successful implementation of the VIP is highly unlikely
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