Since 2008, Nestlé has been in negotiations with the city of Cascade Locks and the Oregon Dept. of Fish and Wildlife for water from the Oxbow Springs in the Columbia River Gorge. Nestlé wants to bottle the spring water under the Arrowhead brand. How bad does Nestlé want Oregon's water and the profits that spring from them? Bad enough to endure years of public outcry.
The company, known for chocolate milk and candy bars in the U.S., is in fact the largest food company in the world and also the world's number one bottled water company. It had annual revenue of about $92.9 billion in 2015, and of that, $7.4 billion was from water. It is one of the most profitable corporations on the planet.
Nestlé came to Oregon using the same quick and quiet methods it found successful in other states to secure the water. Former Gov. Ted Kulongoski did not object and ODFW, holding the water rights to Oxbow, agreed to exchange rights with the city of Cascade Locks to make the deal possible. Nestlé's aim is to bottle and truck out 100 million gallons of the spring water per year.
The Swiss multinational then tried to speed up the deal by going above the permitting process with a permanent water rights transfer from ODFW, avoiding consideration of the impact on the public. That almost worked, but at last Gov. Kate Brown stepped in and took an interest in the larger ramifications to Oregonians. Specifically, whether and how Oregon should relinquish public water rights and natural resources.
Nestlé's annual water sales of $7.4 billion represented an operating profit margin of 11.2 percent in 2015 as demand reached an all-time high in the U.S. with 10 billion gallons sold. Nestlé will continue to make a killing selling bottled water and can afford to take the long view on these local deals. In fact, Nestlé has continued its pursuit despite public protests, tribal water treaties, and now a ballot measure to block large scale bottling supported by 100 local businesses and farmers. (Measure 14-55 will be on the May 17 ballot in Hood River County.)
Nestlé is in for the long haul and will wait for its money to speak loudly enough in Salem. It has hired lobbyist Rebecca Tweed, who has worked on more than 40 political campaigns in Oregon and in 2010, was the political director for the Oregon House Republican Caucus. It would be an understatement to say she is well-connected. The fact that Nestlé has annual revenue more than triple the state of Oregon's annual budget, means that it can and will sustain a long battle.
Selling water is a multibillion-dollar business. Large corporations budget for lawsuits and target locations, such as Cascade Locks, which may be willing to sacrifice natural resources for a handful of jobs and some property tax revenue. Oregon doesn't need economic development this badly (amounting to 50 minimum wage jobs). Oregon has more at stake than Nestlé does, and water is of long-term importance to the state.