Agricuture’s contribution to Deschutes County’s economy

I was recently criticized for not sufficiently valuing the economic contribution of agriculture to the Central Oregon economy.  Some readers felt that the value provided by farmers justified the damage to our local rivers caused by irrigation withdrawals.  I am reminded of an old quote that goes something like “we can have our own opinions but we can’t have our own facts”, so here are some facts.  You can form your own opinion.  I again want to stress that I am not advocating for the forced elimination of water deliveries to any water right holder.  As I have written about on this blog there are affordable and relatively quick solutions that allocate water to irrigators while also partially restoring rivers.  I believe it is time to implement water policies that ensure our economic vitality for the next 100 years, not that reflect the past 100.

Start by taking a look at the 2012 US Department of Agriculture Census Profile of Deschutes County  and the census web site.  (Done every 5 years, the 2017 survey will not be released until 2019.)  It is important to note that this report is for Deschutes County, not Jefferson or Crook counties where there are numerous large, economically important farms.

  • In 2012 there were 1,283 farms in Deschutes County.  Over 78% of these were under 50 acres.  The median farm was 20 acres.  38 of the 1,283 are over 500 acres.  In other words, Deschutes County is dominated by small farms but also contains a few big ones.
  • The average farm received $5,488 in government subsidies while producing $16,033 in sales.  In fact, 78% of all farms produced less than $10,000 in sales.
    • I am not sure how the $5,488 figure is derived.  It must include various tax benefits for being classified as a farm. Does it include past subsidies for modernization efforts including canal piping?  It certainly does not include the current requests for taxpayer financing of hundreds of millions of additional dollars for piping.
  • The sales from an average farm did not cover the cost of operation.  The average farm lost $11,538.
  • In terms of agricultural products sold, Deschutes County ranked 32 out of 36 counties in the state.
  • The majority of farmers derived their income principally from another occupation.

Per this report, in 2012 ag sales in Deschutes County were $26.1M which expanded to $91.3M in total economic impact.  That is only 1.57% of the roughly $5.8B (billion) total GDP of Deschutes County that same year.  Since then economic growth has been stunning, one of the top growth rates in the nation.  In 2015 Deschutes County’s economy was $7.3B with essentially none of that growth from agriculture (ag is part of “natural resources and mining” in the report).  The bottom line is that ag is a very small part of Deschutes County’s economy.   (Also this see report.)

Regarding food production, there very little of that in Deschutes County.  Ag in Deschutes County is mostly hobby farms and growing grass/hay primarily for horses and some commodity livestock.  The story is different in other counties, but the majority of water is taken from the Deschutes River by irrigators in Deschutes County.

In short, while there are some large scale operations, Deschutes County is dominated by hobby farmers, those who enjoy the farming lifestyle, not those who rely on it for their livelihood.  Clearly, this is their right.  As someone who spent part of my youth raising animals and growing most of the vegetables we consumed, I get it.  There is something deeply rewarding about a connection to your land and seeing (and eating) the fruits of your labor.

Nevertheless, there is a societal issue that is not being addressed.  It goes without saying that the economy of Central Oregon has seen dramatic change over the past 100 years, a period of time when 90% of the water in the Deschutes River above Bend was granted to local irrigation districts.

I recently spoke with an economist who said that the recreation economy is already over 10 times the size of the ag economy in Deschutes County.  I’ll post more on that when the data is available.  I have previously argued that even this sort of analysis does not fully appreciate the economic impact of the Deschutes River to the county.  A strong argument can be made that most of the growth in our economy can be attributed to the “lifestyle” new residents seek and the lifeblood of that lifestyle is the Deschutes River. Restoring the river will support the continuation of our growth.

In my opinion, it is time for irrigators to uniformly use modern irrigation techniques that reduce water consumption. For example, farmers in North Unit Irrigation District have junior water rights causing them to use delivery systems that allow for the  cultivation of far more land using far less water.

Let’s allocate water for the next 100 years, not the past 100.