KING An Evaluation of Corporate Perceptions of a Payment for Ecosystem Services Program in the McKenzie River Basin June  2013     Final  Report     Community  Planning  Workshop     A  Program  of  the   Community  Service  Center   at  the  University  of  Oregon     Institute  for  a  Sustainable  Environment,  University  of  Oregon   Institute  for  Natural  Resources,  Oregon  State  University                                   Special Thanks & Acknowledgements   Community  Planning  Workshop  wishes  to  thank  the  following   individuals  for  their  assistance  with  this  project.   Karl Morgenstern, Eugene Water & Electric Board Nancy Toth, Eugene Water & Electric Board Sally Duncan, Institute for Natural Resources Maria Lewis, Oregon State University Kelly Jacobson, Community Planning Workshop Research Team Community Planning Workshop Staff Robert Parker, AICP Director Angela San Filippo Institute for a Sustainable Environment Staff Max Nielsen-Pincus, PhD Cassandra Mosley, PhD Institute for Natural Resources Staff Sue Lurie, PhD Sally Duncan, Institute for Natural Resources About NIFA Funding  for  this  report  was  provided  by  the  USDA  National  Institute  for   Food  and  Agriculture  (NIFA)  Grant  No.  2011-­‐67023-­‐30108.  NIFA's  mission  is   to  lead  food  and  agricultural  sciences  to  create  a  better  future  for  the   Nation  and  the  world  by  supporting  research,  education,  and  extension   programs  in  the  Land-­‐Grant  University  System  and  other  partner   organizations.  Find  out  more  at:   http://www.csrees.usda.gov/about/background.html   Table of Contents   Executive  Summary  ....................................................................................  i   Key  Findings  .......................................................................................................  i   Implications  for  Corporate  Engagement  in  PES  Programs  ..................................  ii   Chapter  1:  Introduction  .............................................................................  1   Background  .......................................................................................................  1   Organization  of  this  Report  ...............................................................................  2   Chapter  2:  Framework  ...............................................................................  3   Background  .......................................................................................................  3   Rationale  ..........................................................................................................  5   Chapter  3:  Focus  Group  Process  .................................................................  6   Purpose  ............................................................................................................  6   Methods  ...........................................................................................................  6   Business  recruitment  ..........................................................................................  6   Focus  group  structure  .........................................................................................  7   Chapter  4:  Findings  ....................................................................................  9   Characteristics  of  Business  Participants  .............................................................  9   Key  Findings  ......................................................................................................  9   Focus  group  1  ...................................................................................................  10   Focus  group  2  ...................................................................................................  13   Focus  group  3  ...................................................................................................  16   Common  themes  .............................................................................................  18   Current  sustainability  practices  ........................................................................  18   Participation  .....................................................................................................  19   Benefits  .............................................................................................................  19   Increasing  program  attractiveness  ...................................................................  20   Labeling  .............................................................................................................  20   Geographic  Scope  .............................................................................................  21   Watershed  protection  fee  ................................................................................  21   Barriers  .............................................................................................................  21   Chapter  5:  Conceptual  Corporate  Framework  ..........................................  23   Marketing  Strategy  .........................................................................................  23   Implementation  ..............................................................................................  24   Property  evaluation  ..........................................................................................  24   Monitoring  ........................................................................................................  24   Reporting  ..........................................................................................................  24   Business  Investment  .......................................................................................  25   Levels  of  investment  .........................................................................................  25   Methods  of  investment  ....................................................................................  25   Benefits  to  Businesses  .....................................................................................  26     References  ...............................................................................................  27   Appendix  A  ..............................................................................................  29   Recruitment  phone  script  ...............................................................................  29   Recruitment  Email  Script  ................................................................................  32   Focus  group  invitation  ....................................................................................  33   Appendix  B  ..............................................................................................  34   Program  Overview  ..........................................................................................  34   Questionnaire  and  Business  Participant  Responses  ........................................  35   Appendix  C  ..............................................................................................  37   Focus  Group  Structure  and  Discussion  Questions  ............................................  37           Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  i   EXECUTIVE SUMMARY This  report  presents  the  results  of  three  business  engagement  focus  groups   conducted  in  March  2013.  The  primary  purpose  of  the  focus  groups  was  to   determine  corporate  interest  in  sponsoring  payment  for  ecosystem  service   programs.  A  secondary  purpose  was  to  determine  local  business  interest  in   supporting  a  voluntary  incentive  program  for  watershed  services  being  developed   by  a  local  utility  to  protect  source  water  quality.  These  focus  groups  are  part  of  a   larger  research  project  analyzing  the  potential  for  utilities  to  act  as  local  Payment   for  Ecosystem  Services  (PES)  marketplace  drivers.  The  research  included  three   focus  groups  with  a  total  of  17  business  participants  from  the  Eugene  Springfield   area.   Key Findings The  following  key  findings  summarize  the  common  themes  and  findings  from  the   three  focus  groups  with  corporate  representatives.   • Preexisting  corporate  sustainability  practices  and  community  involvement   programs  may  be  useful  indicators  for  recruiting  PES  investors.  Participants   with  strong  sustainability  programs  appeared  to  be  more  receptive  to   investing  in  PES  programs.   • Participants  indicated  being  strongly  motivated  to  invest  in  PES  because  of   the  ability  to  increase  their  corporation’s  community  involvement  and   provide  benefit  to  the  community  as  a  whole.   • Corporation  size  and  geographic  reach  are  good  indicators  for  the  types  of   benefits  potential  corporate  investors  are  interested  in.  For  example,  small   corporations  with  a  strictly  local  geographic  reach  were  more  highly   motivated  by  purely  monetary  benefits  (e.g.,  increases  in  gross  revenue)   than  larger  corporations  with  regional  or  national  scope.   • Participants  expressed  the  importance  of  education  and  public  awareness   components  of  PES  programs.   • Participants  that  were  able  to  make  a  direct  connection  between  their   product  and  water  quality  expressed  a  higher  level  of  interest  in   labeling/branding  of  their  products  in  relation  to  a  PES  program.   • Providing  a  menu  of  choices  for  corporations  to  determine  their  own  level   of  investment,  how  they  want  to  invest,  and  what  benefits  they  receive  in   return  will  appeal  to  a  broader  range  of  corporations  and  give  corporations   an  opportunity  to  build  a  unique  program  that  works  for  their  individual   needs.   • Participants  were  more  interested  in  a  participatory  investment  approach;   they  saw  higher  participation  as  having  more  potential  benefit  to  them  as   well  as  a  way  to  be  more  involved  in  the  program  and  the  community.   Page  |  ii       Community  Planning  Workshop   Examples  of  participatory  investment  included:  sponsoring  events,   investing  through  product  and  service  giveaways,  and  volunteer  hours.   • Participants  thought  that  partnerships  with  other  environmental,   conservation,  and  state  organizations  and  agencies  working  in  the   McKenzie  River  watershed  would  help  to  create  a  universal  logo  and   program  that  is  more  recognizable  to  the  community.   • Participants  indicated  that  clearly  defined  opportunities  and  suggestions   for  how  corporations  can  capitalize  on  their  investment  in  PES  would  make   the  program  more  desirable.   • Participants  recommended  built  in  accountability  through  property   evaluation,  monitoring,  and  annual  or  semi-­‐annual  reporting.   Implications for Corporate Engagement in PES Programs Based  on  the  key  findings  from  focus  groups  with  corporate  representatives  and   the  resulting  conceptual  framework  found  in  Chapter  and  5  engaging  corporations   in  PES  programs  will  create  the  following  potential  implications:   • Increase  the  amount  of  available  funding.   • Increase  corporate  involvement  and  relationships  in  the  community.   • Increase  public  and  corporation  awareness  and  education  about  watershed   health  and  other  ecosystem  services.   • Establish  partnerships  and  build  relationships  between  public  utilities  and   corporations.   • Increase  available  opportunities  for  corporations  to  incorporate   sustainability  practices  into  their  business  practices.         Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  1   CHAPTER 1: INTRODUCTION This  report  presents  the  results  of  three  business  engagement  focus  groups   conducted  in  March  2013.  The  primary  purpose  of  the  focus  groups  was  to   determine  corporate  interest  in  sponsoring  payment  for  ecosystem  service   programs.  A  secondary  purpose  was  to  determine  local  business  interest  in   supporting  a  voluntary  incentive  program  for  watershed  services  being  developed   by  a  local  utility  to  protect  source  water  quality.  These  focus  groups  are  part  of  a   larger  research  project  analyzing  the  potential  for  utilities  to  act  as  local  Payment   for  Ecosystem  Services  (PES)  marketplace  drivers.  The  research  included  three   focus  groups  with  a  total  of  17  business  participants  from  the  Eugene  Springfield   area.   Background Interest  is  growing  at  the  federal,  state,  and  local  level  in  programs  that  protect   watershed  health  by  offering  incentives  to  landowners  that  restore  or  maintain   their  property  in  ways  that  benefit  and  preserve  water  quality  and  supply.  Such   programs  recognize  there  is  economic  value  to  managing  land  in  a  way  that   protects  environmental  goods  of  public  interest  –  such  as  water  quality,  native   wildlife,  or  recreation  opportunities.  Referred  to  as  payment  for  ecosystem  services   (PES),  such  programs  have  shown  to  be  successful  in  a  number  of  places  in  the   United  States.  Notably,  the  City  of  Denver,  Colorado  has  taken  steps  to  establish   PES  markets  to  proactively  protect  the  watershed  that  supplies  their  drinking  water   sources.   In  2011,  Oregon  State  University  (OSU)  and  the  University  of  Oregon  (UO)  received   a  grant  from  the  National  Institute  of  Food  and  Agricultural  (NIFA)  to  investigate   how  public  water  districts/utilities  and  corporations  might  provide  sufficient   funding  and  incentives  to  pay  for  ecosystem  services.  To  facilitate  research   members  of  the  OSU’s  Institute  for  Natural  Resources,  University  of  Oregon’s   Institute  for  a  Sustainable  Environment,  and  UO’s  Community  Planning  Workshop,   formed  a  joint  team  (referred  to  as  the  research  team).   This  report  is  part  of  a  larger  research  project  that  investigated  multiple  elements   regarding  the  potential  role  of  utilities  and  corporations  in  local  marketplace   development.  Methods  for  the  larger  research  project  include  land  use  evaluation,   participant  observation,  surveys  of  ratepayers  and  landowners,  in-­‐depth,  semi-­‐ structured  interviews  with  local,  regional  national/international  business  owners   with  a  presence  in  the  Willamette  Valley,  including  Eugene;  and  focus  groups  with   local  businesses.  This  report  focuses  on  the  findings  from  the  focus  groups  with   local  businesses.   For  this  portion  of  the  larger  research  project  the  research  team  was  interested  in   understanding  if  locally  situated  businesses—enterprises  operating  strictly  in  the   local  community  or  regional  or  national  firms  with  a  local  presence—  would  be   willing  to  pay  for  ecosystem  services  linked  to  water  quality,  providing  viable   additional  sources  of  revenue  for  the  long-­‐term  sustainability  of  small  and  medium-­‐ Page  |  2       Community  Planning  Workshop   sized  farms  and  rural  communities,  and  to  explore  the  feasibility  of  instituting  these   models  at  different  scales.     In  March  2013,  the  Research  Team  conducted  three  businesses  engagement  focus   groups.  All  three  focus  groups  centered  on  learning  about  participants’  views  and   current  engagement  in  sustainability  activities  and  their  willingness  to  participate  in   the  Eugene  Water  &  Electric  Board  (EWEB)  Voluntary  Incentives  Program  (VIP).   Focus  group  discussions  were  based  on  current  business  sustainability  practices,   motivating  factors  to  investment,  what  incentives  would  encourage  businesses  to   invest  in  the  VIP,  and  what  types  of  barriers  exist  to  investment.   Organization of this Report The  remainder  of  this  report  is  organized  as  follows:   • Chapter  2  presents  the  framework  for  the  overall  study,  including  an   overview  of  payment  for  ecosystem  services,  and  a  more  detailed   discussion  of  the  structure  of  this  study.     • Chapter  3  presents  the  purpose  and  methods  used  to  conduct  business   focus  groups.   • Chapter  4  describes  the  three  focus  group  discussions  and  the  common   themes  that  developed  from  the  three  discussions.   • Chapter  5  describes  the  potential  corporate  framework  based  on  the   common  themes  of  the  focus  groups  and  the  landowner  focus  groups.   This  study  also  contains  the  following  appendices:   • Appendix  A:  Focus  group  recruitment  and  facilitation  instruments.   • Appendix  B:  Pre-­‐focus  group  program  overview  and  questionnaire  with   business  participant  responses.   • Appendix  C:  Focus  group  structure  and  discussion  questions.       Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  3   CHAPTER 2: FRAMEWORK This  chapter  describes  the  framework  for  thinking  about  innovative  approaches  to   protect  and  improve  ecosystems  in  Oregon  and  across  the  country,  and  why   payment  for  ecosystem  services,  with  EWEB’s  voluntary  incentive  program  (VIP)  as   a  local  example,  may  be  a  good  option.  It  also  describes  the  shift  toward  business   sustainability  and  how  PES  may  be  able  to  add  to  business  sustainability  and  help   fund  such  programs,  as  business  investment  may  be  significantly  underutilized  and   understudied  as  a  funding  mechanism  for  local  PES  programs.  This  chapter   concludes  by  describing  the  rationale  that  underlines  the  research  for  this  project.   Background Payment  for  Ecosystem  Services  (PES)  programs  are  a  market  based,  non-­‐ regulatory  strategy  for  protecting  ecosystem  health,  for  the  purposes  of  this   research  we  are  focusing  specifically  on  watershed  health.  The  beneficial  services   provided  by  a  healthy  watershed  such  as  flood  control,  water  filtration,  erosion   control,  recreation  opportunities,  and  fish  and  wildlife  habitat  can  to  some  degree   be  quantified  and  valued.  Methods  for  valuing  ecosystem  services  are  really  still   evolving  and  there  are  difficulties  associated  with  doing  an  economic  valuation,   typically  they  underestimate  the  true  value  and  are  rarely  straightforward.   Normally,  financial  incentives  are  offered  to  landowners  in  exchange  for  adopting   land  management  and  water  use  practices  that  protect  watershed  or  ecosystem   services.  Protection  of  riparian  habitat,  reduction  of  non-­‐point  source  pollution,   and  storage  of  flood  waters  are  some  examples  of  ecosystem  services.  Landowners   who  choose  to  participate  in  such  a  program  are  often  referred  to  as  providers,   because  through  their  protective  or  restorative  actions,  they  are  providing   watershed  services.  Funding  for  watershed  protection  typically  is  generated  by   users  of  the  ecosystem  services  (also  called  buyers)  (Hickson,  2012).   Much  of  the  attention  surrounding  PES  has  focused  on  the  public  sector  and  non-­‐ profit  organizations;  private  sector  investment  in  the  form  of  businesses  and   corporations  has  received  less  attention  (Waage,  et  al.,  2007).  Along  these  lines,   there  are  a  number  of  federal  and  state  policies  and  programs  –  e.g.’  USDA   Conservation  Reserve  Program  (CRP),  Conservation  Reserve  Enhancement  Program   (CREP),  and  Environmental  Quality  Incentives  Program  (EQIP)  –  that  encourage   producers  to  adopt  ecologically  beneficial  practices  on  agricultural  lands  (Bernstein,   Cooper,  and  Classen  2004;  Wu  and  Lin  2010).   However,  private  sector  interest  in  PES  is  growing,  in  part  because  of  an  emerging   paradigm  shift  within  the  business  community  that  seeks  to  reposition  businesses   within  a  broader  social  and  environmental  context  (Waage,  Armstrong,  Hwang,  &   Bagstad,  2011).  In  addition,  with  businesses  becoming  more  aware  of  potential   resource  scarcity  businesses  are  coming  to  understand  that  environmental   stewardship  may  be  critical  to  ensuring  their  longevity  and  managing  risk  over  time.   Other  potential  benefits  to  businesses  include,  but  are  not  limited  to,  regulatory   compliance,  cost  savings,  and  creating  a  favorable  relationship  with  the  community   Page  |  4       Community  Planning  Workshop   (Gutman  &  Davidson,  2007;  Waage,  et  al.,  2007;  Hanson,  Ranganathan,  Iceland,   Finisdore,  &  Finisdore,  2012).     The  private  sector  also  represents  a  crucial  opportunity  for  investment  in   ecosystem  services.  The  scale  of  investments  available  from  the  private  sector  is   much  greater  than  that  of  the  public  and  voluntary  sectors  (Mulder,  ten  Kate,  &   Scherr,  2006;  Waage,  et  al.,  2007);  also  businesses  have  much  to  contribute  in   terms  of  expertise,  networking,  and  innovation  (Perrot-­‐Maitre,  2006;  Gutman  &   Davidson,  2007).  With  appropriate  institutions  and  incentives,  payments  for   ecosystem  services  hold  the  potential  to  add  new  revenue  streams  for  producers   while  restoring  ecosystem  functions  in  a  positive  feedback  loop  (Zhang,  Ricketts,   Kremen,  Carney,  &  Swinton,  2007;  Parkhurst,  et  al.,  2002;  Goldman,  Thompson,  &   Daily,  2007).   Eugene  Water  &  Electric  Board’s  (EWEB)  Voluntary  Incentive  Program1  is  a  local   example  of  a  PES  program  in  development  and  was  used  in  focus  groups  as  a   tangible  example  for  discussion.  EWEB’s  VIP  will  pay  participating  private   landowners  for  maintaining  high  quality  riparian  areas  that  provide  ecosystem   services  to  EWEB  and  its  customers.  Landowners  whose  properties  are  located   within  a  defined  boundary  adjacent  to  the  McKenzie  River  and  its  largest  tributaries   and  contain  high  quality  riparian  areas  could  participate.     The  initial  VIP  program  boundary  encompasses  approximately  6,500  acres  of   riparian  and  floodplain  lands.  Boundaries  were  arrived  at  using  a  geographic   information  system  (GIS)  based  model  developed  at  Michigan  Technological   Institute.2  Criteria  for  healthy  riparian  forest  comes  from  a  combination  of   definitions  used  by  Willamette  National  Forest,  United  States  Department  of   Agriculture  National  Resource  Conservation  Service  (NRCS),  Defenders  of  Wildlife   and  other  entities  with  established  criteria.  EWEB  will  launch  the  envisioned  VIP   with  ratepayer  funds.  Potential  sources  of  additional  funding  under  consideration   include  business  contributions,  development  mitigation  fees,  a  watershed   protection  fee  and  other  sources.  Business  focus  groups  focused  on  the  feasibility   of  business  contributions  to  the  VIP.   EWEB  envisions  the  development  of  a  PES  program  (called  VIP)  that  would  make   annual  dividend  payments  to  landowners  who  maintain  riparian  buffers  within  an   identified  stewardship  boundary  encompassing  riparian  forests  and  floodplains.   Participation  in  the  VIP  is  open  to  non-­‐industrial  private  landowners,  local   governments,  and  non-­‐profit  organizations  that  own  land  with  a  designated   boundary.  The  program  is  currently  in  a  conceptual  state;  EWEB’s  intent  is  to   implement  the  VIP  in  2014.   EWEB’s  approach  is  to  reward  good  land  stewards  that  maintain  high  quality   riparian  buffers  to  ensure  that  these  landowners  continue  these  practices.  This                                                                                                                             1 http://www.eweb.org/sourceprotection/vip 2 GIS Modeling Of Riparian Zones Utilizing Digital Elevation Models And Flood Height Data: An Intelligent Approach. Lacey Mason and Ann L. Maclean, School of Forest Resource and Environmental Sciences Michigan Technological University. http://www.asprs.org/a/publications/proceedings/tampa2007/0042.pdf   Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  5   differs  from  other  programs,  such  as  NRCS’s  Environmental  Quality  Incentives   Program  (EQIP),  which  offer  incentives  to  landowners  with  degraded  land  to   restore  their  properties  to  an  improved  condition.  Instead,  EWEB  has  chosen  to   reward  landowners  already  protecting  land  that  contributes  to  maintaining  water   quality  as  an  ecosystem  service.  In  doing  so,  EWEB  can  maintain  both  ecosystem   and  community  resilience,  which  in  turn  provide  opportunities  for  cost  savings  and   PES  marketplace  development.   Rationale The  rationale  for  the  bigger  picture  NIFA  research  project  is  to  contribute  to  a   better  understanding  of  the  potential  for  public  utilities  to  participate  in  PES   schemes,  which  is  currently  a  little-­‐explored  subject  in  the  scholarly  literature.  In   practice,  PES  programs  are  just  beginning  to  be  investigated  by  isolated  utilities   around  the  country.  However,  PES  programs  have  risen  to  prominence  in  select   locations,  such  as  Denver,  Colorado  (Toombs,  Goldstein,  Hanson,  Robinson-­‐ Maness,  &  Fankhauser,  2011)  and  New  York  City  (Goldman,  Thompson,  &  Daily,   2007),  as  a  means  to  proactively  address  growing  concerns  around  the  relationship   between  watershed  land  stewardship  and  water  quality,  especially  in  the  context  of   drinking  water  resources.   Widespread  business  investment  in  PES  could  be  transformative;  it  could   effectively  shift  the  discussion  of  environmental  initiatives  from  isolated,  discrete   actions  to  cumulative,  system  wide  approaches  (Waage,  Hwang,  &  Armstrong,  The   Quiet  (R)Evolution  in  Expectations  of  Corporate  Environmental  Performance:   Emerging  Trends  in  the  Uptake  of  Ecosystem  Services,  2012).  The  focus  groups  with   businesses  in  the  Eugene  and  Springfield  area  seek  to  gain  perspectives  from  a   variety  of  business  representatives  ranging  in  geographic  scale  and  business  type.   In  order  to  gain  insight  into  PES  programs,  business  representatives  were  asked   about  their  current  sustainability  practices,  potential  level  of  interest  in  PES   programs,  recommendations  for  benefits  that  would  make  PES  programs  more   attractive  to  them  and  potential  barriers  to  their  investment  in  such  programs.         Page  |  6       Community  Planning  Workshop   CHAPTER 3: FOCUS GROUP PROCESS This  chapter  describes  the  purpose  and  methods  used  to  conduct  the  focus  group   meetings.  It  describes  methods  the  Research  Team  used  to  recruit  participants  as   well  as  the  structure  of  the  focus  group  meetings.   Purpose The  purpose  of  the  focus  groups  was  to  determine  local  business  interest  in  PES   programs  such  as  the  VIP  and  what  sorts  of  incentives  would  encourage  corporate   investment.  Specifically,  the  research  objectives  were  to:   1. Determine  local  business  interest  in  PES  programs.   2. Identify  incentives  such  as  acknowledgements  or  other  benefits  that  would   promote  a  range  of  different  business  types  and  levels  of  geographic  reach   (local,  regional,  national)  to  participate  in  PES  programs.   3. Understand  motivating  factors  behind  investment  in  PES  programs.   4. Identify  barriers  or  constraints  that  would  hinder  different  types  and  scales   of  businesses  to  participate  in  PES  programs.   Methods The  methods  used  to  conduct  focus  groups  are  divided  into  the  business   recruitment  process  and  focus  group  structure.   Business recruitment To  recruit  businesses  to  participate  in  focus  groups  the  research  team  first   compiled  a  list  of  businesses  based  on  local  knowledge,  participation  in  Green  Lane   Sustainability  Network,  history  of  support  for  the  McKenzie  River  watershed,   reliance  on  high  water  quality  to  develop  products,  and  recommendations  from  the   research  team’s  business  network.  Green  Lane  Sustainable  Business  Network  is  a   membership  organization  focused  on  education,  resources,  networking,  and   marketing  for  sustainability.  Green  Lane’s  mission  is  to  help  organizations  be  more   sustainable.  This  list  of  businesses  was  then  categorized  based  on  the  type  of   business  and  ranked  on  priority  for  recruitment  based  on  current  sustainability   efforts,  their  local,  national,  or  regional  presence,  their  water  use,  and  their   reliance  on  high  water  quality.  Businesses  were  dived  into  the  following  17   business  categories:             Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  7   • Agriculture/Farming   • Local  retail   • Back  office  companies3   • Port-­‐a-­‐potty  &  septic     • Breweries  &  wineries   • Resource  extraction     • Dairies   • Restaurants  and  catering   • Garden  centers  &  nurseries   • Service  focus   • Healthcare   • Sporting  goods   • High  water  users   • Waste  handlers   • Hotels  &  B&Bs   • Food  production  &  distribution   • Local  grocers     Each  of  the  17  categories  of  businesses  were  given  first,  second,  and  third  tier   contact  priority  based  on  current  sustainability  practices,  business  scale  (local,   regional,  or  national),  and  quality  of  contact  information.  The  goal  of  the   prioritization  process  was  to  contact  a  range  of  business  types  that  would   potentially  have  an  interest  in  PES  programs.  This  included  a  variety  of  business   types  (see  categories  listed  above)  and  sizes,  as  well  as  businesses  representing  a   range  of  interests  in  sustainability  practices.  Each  business  category  had  between   three  and  eight  first  priority  businesses.  In  order  to  contact  and  invite  a  range  of   businesses  the  first  priority  businesses  were  contacted  first  and  as  time  and   resources  allowed  the  second  and  third  priority  businesses  were  contacted.     Businesses  were  contacted  via  phone  and  email.  On  initial  contact  businesses  were   given  a  brief  explanation  of  the  project  and  were  asked  if  they  would  like  to   participate  in  a  focus  group.  A  one  page  invitation  was  emailed  to  all  businesses   contacted  with  an  email  address.  See  Appendix  A  for  invitation  and  phone  and   email  scripts.  All  businesses  were  followed  up  with  several  times  to  ensure  that   they  were  given  ample  opportunity  to  participate  in  one  of  the  focus  groups.   Focus group structure Focus  group  participants  were  emailed  a  program  overview  and  a  questionnaire   prior  to  the  focus  group.  The  questionnaire  was  structured  to  give  the  research   team  some  basic  information  about  the  type  and  geographic  scale  of  businesses   that  participated  in  focus  groups.  See  Appendix  B  for  program  overview  and   questions  and  participant  answers  to  the  questionnaire.  At  the  beginning  of  each   focus  group  participants  were  provided  a  brief  in  person  overview  of  PES  and   specifically  the  VIP  program.                                                                                                                             3  A  back  office  is  a  part  of  most  corporations  where  tasks  dedicated  to  running  the  company  itself   takes  place.  Back  offices  may  be  located  somewhere  other  than  company  headquarters.  Examples  of   back  office  tasks  include  information  technology  departments  that  keep  the  phones  and  computers   running,  accounting,  human  resources,  administrative  functions,  order  management,  operations   support,  and  customer  support  call  centers.   Page  |  8       Community  Planning  Workshop   During  each  focus  group  participants  were  first  asked  about  their  businesses   current  sustainability  activities  and  how  these  activities  fit  into  their  core  business   mission  and  goals.  Participants  were  also  asked  what  parts  of  the  PES  concept   would  motivate  them  to  participate  in  this  type  of  program.  This  question  was   followed  by  participant  ideas  for  additions  or  concepts  that  would  make  PES  a   more  attractive  investment  for  their  business.  Participants  were  asked  about   whether  or  not  the  geographic  scale  of  PES  programs  was  important  to  them,  their   feelings  about  an  additional  watershed  protection  fee,  and  other  potential  barriers   to  investment  in  PES.  See  Appendix  D  for  focus  group  structure.         Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  9   CHAPTER 4: FINDINGS This  chapter  presents  a  summary  of  the  three  business  focus  groups  with  a  total  of   17  participants  conducted  in  March  2013.  This  chapter  describes  participating   business  characteristics,  the  key  findings  from  each  of  the  three  focus  groups,  and  a   summary  of  the  common  themes.   Characteristics of Business Participants This  section  describes  the  characteristics  of  the  businesses  that  were  represented   in  focus  groups.  This  group  of  17  businesses  was  not  intended  to  be  representative   of  all  Eugene-­‐Springfield  area  businesses.  This  is  a  small  subset  of  the  population   that  is  used  to  gauge  general  interest  and  obtain  feedback  for  PES  programs.  A   concerted  effort  was  made  to  reach  a  diverse  group  of  businesses;  however,  the   information  cannot  be  used  to  generalize  the  opinions  of  the  business  population   of  the  Eugene-­‐Springfield  area.  Rather,  the  information  serves  to  highlight  the   range  of  issues  businesses  might  have  with  investing  in  PES.   The  Research  Team  administered  a  pre-­‐  focus  group  questionnaire  to  participants   that  included  questions  about  the  type  and  geographic  scale  of  their  business  as   well  as  the  sustainability  culture  in  their  industry  and  whether  their  business  had  a   sustainability  champion  or  director.  Eight  businesses  identified  their  business  as   retail,  two  identified  as  service,  and  two  identified  themselves  as  a  combination  of   retail  and  service.  The  remaining  three  businesses  identified  themselves  as  either   distribution/production  or  lodging.   Fourteen  of  the  17  participating  businesses  identified  themselves  as  having  a   culture  of  sustainability  in  their  industries.  The  other  three  responses  varied  from  a   minimal  to  mixed  sustainability  culture.  Nine  businesses  responded  that  they  have   a  sustainability  champion/director;  seven  said  they  do  not  have  one,  and  one   business  said  their  entire  staff  acts  as  sustainability  champions.   The  participating  businesses  ranged  in  size,  with  the  number  of  employees  ranging   pretty  evenly  from  six  to  fifteen  employees  to  more  than  80  employees.  Only  two   businesses  identified  as  having  five  employees  or  less.  Ten  of  the  businesses  (59   percent)  identified  as  only  having  a  local  component  to  their  business  model.  None   of  the  businesses  identified  as  having  only  a  national  or  multinational  component.   See  Appendix  B  for  questions  and  answers  from  the  questionnaire.   Findings Findings  are  presented  separately  for  each  of  the  three  focus  groups.  This  is   followed  by  the  common  themes  that  were  present  throughout  all  of  the  focus   groups.   Page  |  10       Community  Planning  Workshop   Focus group 1 Sustainability practices All  participants  identified  some  level  of  sustainability  practices  in  their  current   business  practices.  Sustainability  practices  included  recycling,  choosing  to  purchase   green  power,  purchasing  energy  efficient  equipment,  and  partnerships  with   environmental  organizations  and  state  agencies  to  implement  monitoring,   restoration,  and  mitigation  projects.  All  businesses  identified  the  importance  of   sustainability  to  the  local  community.     Participation Participants  indicated  several  reasons  for  their  potential  participation  in  a  PES   program.  All  participants  indicated  the  importance  of  being  involved  in  the   community  and  supporting  community  partnerships.  The  majority  of  participants   said  they  could  use  their  participation  and  investment  in  PES  as  a  marketing  tool  to   leverage  potential  customers.  One  product-­‐driven  business  said  they  could   potentially  use  their  investment  as  a  way  to  leverage  customers  that  might  not   otherwise  be  interested  in  their  product  because  it  is  not  organic.  One  participant   representing  a  product  driven  business  stated:   “We’ve  never  been  able  to  say  we’re  organic  or  sustainable  but  this  program   could  be  a  way  of  addressing  questions  about  sustainability…important  with   organic  competitors  right  around  the  corner.”   In  order  to  use  their  participation  in  PES  as  a  marketing  tool,  participants  identified   the  need  for  the  program  to  fit  their  core  business  values  and  mission.  All   businesses  agreed  about  the  importance  of  choosing  community  partners  that   share  their  values  and  have  a  similar  mission  to  their  business.   One  small,  local,  service-­‐focused  business  was  primarily  interested  in  receiving   monetary  benefits  for  investing  in  PES  and  suggested  offering  a  tax  credit.   Benefits to Business All  participants  agreed  their  potential  investment  in  a  PES  program  would  be  a   means  to  market  their  products  or  services  as  more  sustainable  or  community   oriented.  The  majority  of  business  from  product  to  service-­‐driven  and  local  to   national  agreed  that  there  was  potential  for  their  investment  in  a  PES  program  to   have  long  term  benefits  on  building  their  customer  base.   Increasing program attractiveness All  participants  identified  the  need  to  understand  why  this  program  is  important  to   the  community  and  why  companies  should  pick  this  program  to  invest  in  over   others.  In  order  to  understand  the  importance  businesses  would  like  information   marketed  to  them  based  on  how  this  program  fits  into  their  company  mission  and   core  values  as  well  as  the  core  values  of  the  community.  One  participant  described   this  as  follows:     Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  11   “I  would  want  information  marketed  to  me  as  an  organization  about  what  we   do  and  why  we  should  support  it,  not  numbers  in  terms  of  ROI  [return  on   investment],  but  tangible  benefit.”   Businesses  with  core  sustainability  practices  and  values  would  like  to  be  able  to  add   their  participation  in  a  PES  program  into  their  sustainability  practices  and  company   mission.  For  businesses  to  be  able  to  make  this  connection  they  need  to   understand  the  tangible  benefits  of  this  program.  Participants  identified  two   primary  tangible  benefits:  long  term  benefits  to  local  community  and  monetary   benefits  for  participating  businesses.  Businesses  with  a  regional  and  national  scale   were  less  interested  in  labeling  of  their  products  and  services  and  monetary   benefits  and  more  interested  in  the  long  term  benefits  to  the  community  and   creating  a  tie  between  their  business  and  the  local  community.   All  participants  endorsed  the  idea  of  being  able  to  participate  at  different  levels.   Businesses  identified  the  different  levels  of  investment  as  including  not  only   monetary  investments  but  also  product  or  service  giveaways  and  discounts.  All   businesses  agreed  that  having  different  levels  of  support  and  different  methods  of   support  will  enable  more  businesses  to  participate.  Methods  of  support  included   direct  monetary  investment  and  product  and  service  discounts  and  giveaways.  One   retail  business  stated:   “I  would  like  to  see  what  creative  ways  we  could  help  bring  awareness  to  this:   giveaways,  raffles,  etc.  to  leverage  other  funds.”   Service  industries  or  companies  with  memberships  suggested  providing  an  option   for  their  guests  or  customers  to  be  able  to  opt  in  or  out  of  investment  in  PES.  For   example  when  a  customers  or  member  shops  or  buys  a  membership  from  a   business  they  would  have  a  choice  to  pay  more  in  order  to  add  funds  for  the   business  to  invest  in  PES.   Participants  expressed  that  with  different  methods  and  levels  of  investment  it  will   be  imperative  to  have  a  calculation  method  to  determine  the  return  on  investment.   All  participants  agreed  that  it  was  important  to  have  a  return  on  investment  that   felt  equal  to  what  they  put  in.   All  participants  recommended  having  an  annual  or  semiannual  reporting  process   showing  in  a  very  straight  forward  way  what  the  program  goals  were,  how  those   goals  were  met  or  worked  towards,  and  how  business  investments  helped  to  reach   those  goals  and/or  go  above  and  beyond  them.  Participants  also  expressed  the   importance  of  understanding  the  full  program  including  how  the  funds  are  being   used,  who  are  receiving  the  benefits,  and  what  the  benefiting  properties  look  like.   One  participant  expressed  the  importance  of  understanding  what  businesses  were   investing  in  as  follows:   “How  many  miles  or  landowners  are  benefiting?  What  has  been  going  on  on   those  properties?  Is  it  a  bunch  of  old  school  landowners  who  have  been  doing   nothing?  Are  we  paying  them  to  continue  to  do  nothing?”   Page  |  12       Community  Planning  Workshop   Labeling Regional  and  national  businesses  were  not  as  concerned  with  having  a  labeling   scheme  for  their  products  and  services.  However,  all  businesses  including  the   regional  and  national  businesses  recognized  that  a  universal,  recognizable  logo  was   necessary  in  order  to  effectively  benefit  participating  businesses.  Having  this  type   of  universal  and  recognizable  logo  requires  a  substantial  marketing  strategy  that   creates  a  general  level  of  education  and  awareness  throughout  the  community.   Business  participants  recommended  the  marketing  strategy  and  labeling  effort   emphasize  the  local  aspect  of  the  program  as  well  as  how  it  benefits  the   community  as  a  whole  and  the  benefits  to  the  quality  of  the  entire  watershed   rather  than  as  small  components  like  drinking  water.  According  to  businesses  this   type  of  strategy  will  appeal  to  a  broader  community  audience.  One  participant   representing  a  retail  business  said:   “Has  to  include  other  elements,  drinking  water  is  great  but  has  to  be  broader  to   appeal  to  [our]  customers.”   Geographic scope Participants  in  this  focus  group  representing  regional  and  national  companies  said   the  geographic  scope  is  not  as  important  to  them.  For  businesses  that  have  more  of   a  local  focus,  the  local  geography  is  very  important.  Local  businesses  were  not   opposed  to  having  a  bigger  outreach  and  said  it  could  potentially  be  better  to  have   a  more  widely  recognizable  program  but  in  reality  the  majority  of  their  customers   are  from  the  local  area.  As  the  customer  base  extends  beyond  the  local  community   it  becomes  so  widespread  they  were  not  sure  of  the  effectiveness  unless  it  is   associated  with  a  nationally  recognizable  name.   Watershed protection fee With  the  exception  of  businesses  with  the  largest  geographic  reach,  all  businesses   expressed  more  hesitancy  in  potential  PES  investment  when  presented  with  the   potential  for  a  watershed  protection  fee  on  top  of  their  voluntary  investment  in  a   PES  program.  Participants  expressed  the  desire  to  better  understand  the  difference   between  the  watershed  protection  fee  and  investing  in  a  PES  program.   Barriers Two  main  barriers  were  identified:  (1)  the  need  for  monitoring  landowners,  and  (2)   recognition  for  even  the  smallest  investors.  Businesses  expressed  concern  that   without  monitoring  in  place  landowners  would  receive  benefits  without  holding  up   their  part  of  the  agreement.     Small,  local  businesses  were  concerned  that  they  would  not  be  recognized  because   they  aren’t  able  to  invest  as  much  as  larger  businesses  with  more  funds  available.   One  participant  explicitly  said  seeing  a  small  business  name  in  the  middle  of  a  list  of   a  bunch  of  other  business  would  not  be  beneficial.  Finding  ways  to  call  out   individual  businesses,  large  and  small  would  be  more  imperative  to  encouraging   business  investment.     Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  13   Focus group 2 Sustainability practices All  of  the  participants  in  the  second  focus  group  have  sustainability  practices  as   part  of  their  current  business  strategy  and  core  values.  Some  of  these  strategies   were  the  same  from  business  to  business  and  included  recycling,  reusing,  and   composting,  participation  in  Bring’s  ReThink  program,4  purchase  of  green  power,   and  support  of  local  and  national  social  and  environmental  organizations  and   programs  through  monetary  support  or  product  and  gift  certificate  donations.     Four  business  participants  with  local  and  regional  focus  identified  sustainability  as   being  built  into  their  whole  business  plan  encompassing  everything  from  water  and   energy  consumption,  materials  used,  partnerships,  and  suppliers.  All  four  of  these   businesses  expressed  their  interest  in  reducing  their  consumption  and  keeping   their  footprint  small.  Two  of  these  four  businesses  have  installed  solar  panels  at   their  businesses.     Other  ways  that  these  businesses  incorporate  sustainability  into  their  business  is   through  providing  benefits  to  employees  that  bike,  walk  or  carpool  to  work  and   paying  employee  wages  to  volunteer  up  to  16  hours  a  year  with  community   organizations.     Participation Participants  stated  several  motivating  factors  for  potential  investment  in  PES.   Reasons  ranged  from  the  necessity  of  clean  drinking  water,  potential  for  a   marketing  tool  that  is  in  alignment  with  owners,  employees,  and  customers’   personal  values,  and  water  quality  matters  for  the  product  they  create.  Several   regional  and  national  businesses  identified  the  importance  of  being  involved  in  the   community,  one  participant  representing  a  national  business  said:   “[Eugene  is]  the  one  location  where  we  can  prove  face  to  face  what  we  stand   for.  Eugene  is  a  tiny  part  of  what  we  do,  but  the  one  place  where  we  can  prove   it.”   Several  participants  thought  this  program  has  the  potential  to  create  a  more  direct   link  to  businesses  that  is  not  present  in  the  green  power  program.  One  suggestion   that  businesses  identified  was  an  annual  McKenzie  River  Celebration  or  music   festival  with  sponsors  directly  participating.   Benefit to Businesses The  main  benefit  identified  by  business  participants  was  to  create  spot   advertisements  similar  to  Eugene  Weekly’s  Happening  Businesses.  One  local   business  said  that  they  had  a  lot  of  past  success  with  these  types  of  stories  about   their  business.  The  stories  would  be  about  the  business  and  how  they  are   participating  and  investing  in  the  program.  This  was  expressed  by  a  participant   representing  a  local  restaurant:                                                                                                                             4 http://www.bringrecycling.org/home/brg/smartlist_57/rethink_business.html Page  |  14       Community  Planning  Workshop   “People  love  a  story,  pictures,  seeing  people  who  own  the  business.  You  could   run  a  story  with  us  by  the  river.  Eugene  Weekly  does  Happening  Businesses,   spot  advertisements  seem  to  be  really  effective.”   Increasing program attractiveness There  was  a  lot  of  support  for  figuring  out  a  way  for  the  PES  program  to  partner  up   with  other  national  programs  like  LEED  so  that  businesses  would  be  able  to  double   down  on  their  investment.  One  local  participant  said:   “The  LEED  name  is  recognizable  for  folks  from  here  to  Spokane,  it  resonates   with  people.”   The  majority  of  participants  recommended  having  a  cost  benefit  analysis  of  the   program  so  that  business  investors  are  able  to  see  where  their  investment  is  going   and  how  it  is  benefiting  the  community,  the  watershed,  and  their  business.   All  businesses  said  that  different  levels  of  participation  were  a  necessity.  One   recommendation  was  to  have  a  standard  small  investment  as  the  jump  off  point   and  steps  up  from  there  for  businesses  that  want  to  invest  at  a  higher  level.  With   the  higher  investment,  businesses  would  be  eligible  for  more  and  varied  benefits.   Participants  said  program  benefits  would  be  most  effective  if  the  business  gets  to   choose  which  benefits  would  be  the  most  effective  for  their  particular  business.   Discounting  or  giving  away  product  would  be  much  easier  for  many  focus  group   participants  because  as  a  business  you  aren’t  just  getting  a  label  but  a  potential   new  customer  and  is  economically  more  feasible.  One  participant  representing  a   service  focused  business  said:   “Get  us  in  somebody’s  door  to  a  potential  customer…guarantee  the  vote  is  no   today  for  another  charitable  donation,  but  handing  out  more  gift  certificates  or   discounts  for  participants,  I  can  do  off  my  desk.”   According  to  participants  product  and  service  giveaways  and  tapping  into  employer   paid  volunteer  hours  is  a  more  participatory  approach  and  has  more  potential  to   increase  the  businesses  customer  base.   All  businesses  thought  that  there  should  be  lines  between  corporate  sponsors  and   small  businesses,  partners,  and  allies.  This  is  a  way  to  create  transparency  in  who  is   participating  and  how.  Customers  and  ratepayers  would  know  which  businesses  are   investing  and  how.   Labeling In  order  for  labeling  to  be  effective  it  would  have  to  be  something  that  is   recognizable  to  the  community  and  the  community  understands  what  it  stands  for.   One  participant  recommended  a  way  to  implement  this  would  be  to  encompass  all   the  smaller  organizations  that  are  benefiting  the  McKenzie  River  watershed–   something  like  the  United  Way  of  the  McKenzie  River  Watershed.  This  would   create  a  universally  recognizable  label  rather  than  a  bunch  of  smaller  labels  that   don’t  have  much  meaning  to  the  community.     Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  15   Geographic scope Small,  local  businesses  would  be  less  likely  to  participate  if  the  program  were  at  a   larger  geographic  scale.  This  is  stated  very  concisely  by  a  focus  group  participant:   “If  we  have  to  choose  we  would  do  a  local  program  over  a  larger  generic   program.”   Participants  representing  businesses  with  a  regional  and  national  presence  said  the   geographic  scale  would  not  matter  as  much.  If  the  larger  geographic  scope  created   a  more  recognizable  name  it  may  hold  more  weight  for  businesses  with  a  regional   or  national  presence  or  distribution  of  product.   Watershed protection fee When  participants  were  asked  if  their  participation  in  a  PES  program  would  be   affected  by  an  additional  watershed  protection  fee  on  top  of  their  existing  bill  all   businesses  said  it  would  be  like  a  double  whammy  regardless  of  how  small  the  fee   might  be.     “If  businesses  are  already  contributing  through  surcharge,  need  something  that   promotes  and  explains  why  businesses  are  being  asked  to  contribute  extra.”   One  participant  suggested  that  businesses  that  invest  in  the  PES  program   automatically  have  the  watershed  protection  fee  waived  from  their  bill.  This  would   mitigate  the  feeling  that  businesses  are  getting  hit  twice  for  the  same  purpose.     Barriers All  participants  said  it  is  difficult  to  decide  which  organizations  to  contribute  to  and   who  not  to  contribute  to.  This  can  be  attributed  to  the  quantity  of  requests  for   donations  every  business  is  faced  with  on  a  daily  basis.  According  to  participants  it   is  rarely  an  easy  decision  to  contribute  to  one  organization  or  program  over   another.   Several  businesses  brought  up  the  concept  of  green  washing  (green  marketing   deceptively  used  to  promote  the  perception  that  an  organization’s  aims  and   policies  are  environmentally  friendly)  being  present  everywhere.  One  small   business  owner  expressed  concern  that  businesses  could  potentially  use  the  VIP  as   a  form  of  green  washing.  Most  of  the  other  participating  businesses  said  this  was  a   non-­‐issue  and  that  for  the  program  to  be  successful  it  would  need  some  of  these   larger  sponsors  that  are  not  necessarily  environmentally  friendly  but  have  the  need   to  offset  some  of  the  damage  they  do.  Having  these  businesses  invest  in  the   program  has  the  potential  to  be  a  win-­‐win  situation.  One  local  product  driven   business  brought  up  the  fact  that  many  environmental  initiatives  start  small  with   local  businesses  and  organizations  doing  the  right  thing  and  soon  large   corporations  are  on  board  which  can  bring  more  awareness  and  broader  support  to   the  program.   Another  potential  barrier  was  customer  and  ratepayer  understanding  of  PES.   Participants  expressed  concern  that  if  individual  customers  are  assessed  a   watershed  protection  fee  they  may  not  understand  that  businesses  are  investing   Page  |  16       Community  Planning  Workshop   above  and  beyond  those  same  fees.  Ratepayers  may  think  they  are  also  investors   because  they  also  pay  a  fee.  In  order  for  businesses  to  receive  some  benefits  from   their  investments  in  the  PES  program  it  is  important  for  the  community  to  be   educated  and  aware  of  the  program  and  that  business  investments  in  PES  are   voluntary  and  are  on  a  larger  scale  than  the  standard  involuntary  watershed   protection  fee.   One  participant  brought  up  the  concern  that  there  are  antagonists  to  just  about   every  program  and  as  part  of  developing  this  program  participants  must  think   about  who  the  antagonists  to  this  program  will  be.  This  was  not  brought  up  as  a   reason  to  not  participate  but  more  as  something  to  be  aware  of  as  the  program  is   developed.   Focus group 3 Sustainability practices Of  the  three  focus  groups,  Group  3  was  the  most  diverse  in  their  business   sustainability  practices  and  values.  All  businesses  identified  recycling,  reusing,  and   repurposing  products  as  being  important  to  their  companies  when  thinking  about   production,  distribution,  and  waste  generation.  Two  businesses  expressed  the   desire  to  use  more  environmentally  friendly  reusable  materials  but  the  materials   are  not  available.  None  of  the  businesses  have  developed  a  formal  sustainability   program;  however,  four  of  the  businesses  said  it  underlies  most  of  their  decisions.   Several  participants  said  that  due  to  the  nature  of  their  business  they  attract   employees  that  are  concerned  about  sustainability  and  bring  their  personal  values   into  business  practices.     Several  businesses  identified  the  desire  to  use  the  most  environmentally  friendly   sustainable  products  available;  however,  doing  so  is  sometimes  at  odds  with   meeting  market  demands  and  turning  a  profit.  This  requires  decisions  about   sustainability  and  environmental  issues  made  on  a  decision  by  decision  basis  and   not  necessarily  as  standard  operating  procedures.  In  this  respect  most  of  the   businesses  that  participated  in  this  focus  group  were  self-­‐identified  as  more   reactive  than  proactive  when  it  comes  to  sustainability  practices.   Participants  in  this  focus  group  incorporated  the  following  sustainability  practices   into  their  business  operations  and  physical  plant:  a  bioswale,  reuse  of  graywater,   local  deliveries  by  bicycle,  distribution  only  within  the  Northwest,  and  partnerships   and  investments  to  environmental  organizations.  Participants  also  identified  the   desire  to  partner  with  and  buy  products  from  companies  and  organizations  with   missions  and  goals  similar  to  their  own.   Participation Several  firms—  from  small  local  retail  businesses  to  regional  businesses  with  both  a   retail  and  service  component—said  the  PES  would  probably  not  be  a  priority  for   investment.  These  businesses  explained  this  was  because  they  did  not  see  a  direct   connection  between  PES  programs  and  their  business.     Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  17   Most  of  the  participants  that  expressed  interest  in  participating  did  so  because  they   are  dependent  on  high  water  quality  and  the  program  fits  with  their  business   mission  and  the  personal  values  of  employees  and  business  owners.  One   participant  said  if  they  were  to  participate  it  would  be  purely  a  feel  good  donation   project  to  involve  themselves  in  the  community  and  would  not  be  based  on  water   quality  or  other  environmental  factors.   Benefits to Businesses One  business  with  a  specific  product  that  could  be  easily  labeled  with  a  PES  or   environmental  logo  was  interested  in  labeling  of  their  products.  Two  other  product   driven  businesses  with  just  as  easily  labeled  products  said  they  did  not  see  how   product  labeling  would  benefit  their  business.  This  lack  of  interest  seemed  to  be   because  these  participants  did  not  see  the  connection  between  PES  and  their   products.     Most  of  the  participants  said  that  having  a  story  come  out  in  the  local  newspaper   or  EWEB  newsletter  telling  the  story  of  the  program  and  the  recognizing  business   investors  was  more  attractive  than  labeling  and  would  be  more  beneficial  to  their   business.  This  difference  between  labeling  of  products  and  advertisements  in  the   form  of  business  stories  as  expressed  by  a  participant:   “Every  time  I  see  an  emblem  I  need  to  research  it.  But  when  you  show  me  a   story,  I  can  go  right  there  and  look  at  it.”   Increasing program attractiveness All  of  the  participating  businesses  expressed  the  importance  of  a  well-­‐developed   plan  for  the  watershed  that  showed  how  the  money  was  spent;  e.g.,  landowner   accountability,  monitoring,  and  evaluation.  A  couple  businesses  thought  that  a   project  by  project  program  would  be  more  tangible  and  effective  than  a  general   fund.  This  was  explained  as  a  preference  for  solicitation  of  funds  for  particular   projects.  This  preference  seems  to  stem  from  participants  being  more  comfortable   and  familiar  with  restoration  and  watershed  projects  and  lacked  an  understanding   of  how  PES  funds  would  be  used  and  distributed.   Several  of  the  businesses  wanted  a  more  participatory  approach,  not  just  a  label  or   a  sticker  in  the  window.  Participants  said  a  participatory  approach  that  gets   customers  into  their  stores  or  purchasing  their  products  and  services  would  be   more  attractive.  Businesses  were  not  able  to  describe  more  clearly  what  this   participatory  approach  would  look  like,  only  that  stickers  and  other  labels  were   very  passive  and  not  that  desirable.  The  preference  for  a  more  participatory   approach  as  described  by  a  participant  representing  a  local  retail  business:   “Not  just  by  putting  a  label  on  something,  that’s  so  passive.  We  have  to  be   involved  beyond  a  sticker  in  the  window.”   There  was  a  strong  consensus  among  participants  that  there  should  be  an   education  component  to  the  PES  program.  Participants  recommended  that  the  PES   program  should  bring  attention  to  where  our  water  comes  from  and  why  that  is  of   importance  to  the  entire  community.  Participants  thought  that  this  type  of   awareness  could  lead  to  political  clout  and  a  broader  public  awareness.   Page  |  18       Community  Planning  Workshop   Labeling There  was  no  real  consensus  on  labeling.  All  businesses  except  for  one  seemed   indifferent  but  said  labeling  should  be  available  for  those  that  want  it.   Geographic scope According  to  participants  the  geographic  scope  of  the  project  becomes  more   important  as  the  amount  of  investment  increases.  If  businesses  invest  more  it  is   more  important  that  the  program  has  a  local  focus.  Participants  agreed  that  the   program  loses  some  of  its  clarity  as  the  geographic  scope  expands.  Several   businesses  have  customers  at  a  regional  level  and  thought  it  would  be  beneficial  to   have  something  that  was  recognizable  at  a  regional  level  but  said  if  the  program   gets  too  broad  for  example  on  the  scale  of  the  Columbia  River,  the  program  loses   its  appeal.     Watershed protection fee We  did  not  have  a  chance  to  discuss  the  idea  of  an  additional  watershed  protection   fee.   Barriers There  was  some  concern  from  participants  that  a  PES  program  would  be  expensive   to  implement;  and  there  was  some  uncertainty  whether  that  expense  would  be  a   worthwhile  investment  for  the  watershed,  the  investors  in  the  program,  and  rate   paying  customers.   One  participant  suggested  that  businesses,  customers,  and  rate  payers  may   perceive  EWEB  as  not  necessarily  being  the  right  organization  to  filter  funds  for   watershed  protection.  One  participant  expressed  concern  that  EWEB  is  also  a   power  provider,  and  there  is  some  disapproval  among  some  of  their  customers   right  now  regarding  EWEB’s  perceived  lack  of  transparency  regarding  recent  power   rate  increases.   One  participant  was  concerned  that  this  program  was  paying  people  to  maintain   property  when  they  should  be  doing  it  anyway.   One  participant  who  is  also  a  property  owner  on  the  McKenzie  River  said  that   landowners  in  the  McKenzie  River  area  are  there  because  they  don’t  want  to   participate  and  be  told  what  to  do.  According  to  this  participant  if  that’s  the  case,   this  program  may  have  difficulty  getting  landowners  to  participate.  It  should  be   noted  that,  based  on  a  landowner  survey  that  is  a  part  of  this  project  (Community   Planning  Workshop,  2013),  there  is,  in  fact,  landowner  interest  in  voluntary   participation.   Common themes Current sustainability practices All  focus  group  participants  identified  some  level  of  sustainability  practices   currently  in  place  within  their  business.  Businesses  with  the  least  amount  of     Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  19   current  sustainability  practices  still  recycle  and  are  conscious  of  sustainability   principles  and  environmental  concerns  when  making  daily  decisions.     Other  participants  identified  a  stronger  engagement  with  sustainability  that   included  supporting  environmental  organizations  through  donations,  discounts,   and  gift  certificates  as  well  as  participating  in  Bring’s  ReThink  program,  purchasing   green  power,  and  paying  particular  attention  to  the  sustainability  activities  of   vendors  in  their  supply  chain.  The  businesses  with  the  strongest  commitment  to   sustainability  have  purchased  solar  panels  for  their  businesses;  created  bioswales   on  their  property;  provide  benefits  to  their  employees  for  walking,  biking,  and   carpooling  to  work;  and  pay  their  employees  for  up  to  16  volunteer  hours  for   community  service  per  year.   Participation All  focus  group  businesses  agreed  that  their  VIP  participation  would  be  motivated   by  their  desire  to  be  involved  and  have  a  positive  impact  in  the  community.  Most   businesses  also  recognized  the  ability  to  use  the  program  as  a  marketing  tool  to   make  their  businesses  attractive  to  potential  customers  on  the  periphery  of  their   existing  customer  base  or  those  that  are  particularly  motivated  by  environmental   issues.  The  majority  of  firms  also  recognized  the  opportunity  to  use  the  PES   program  as  a  method  to  incorporate  more  sustainability  practices  into  their   businesses.   For  some  small,  local  businesses,  the  motivation  for  participation  was  mostly   monetary.  These  businesses  said  they  would  probably  not  be  able  to  justify   investing  in  a  PES  program  unless  there  was  a  monetary  benefit  for  their  business.   These  participants  said  they  would  need  to  be  able  to  capitalize  on  the  value  of  the   program  and  they  were  still  unclear  on  if  and  how  that  would  be  possible  for  their   businesses.   There  were  two  businesses—one  local  service  oriented  business  and  one  regional   business  with  a  retail  and  a  service  component—that  said,  if  they  chose  to   participate  in  a  PES  program,  it  would  be  solely  for  feel  good,  donation  and   community  involvement  purposes  and  not  for  environmental  or  sustainability   aspects  of  the  program.   Benefits All  participating  businesses  saw  the  potential  benefit  of  investing  in  a  PES  program   if  the  return  for  investment  included  spot  advertisements  telling  the  story  of  their   businesses  and  how  and  why  they  were  participating  in  the  program.  Businesses   regarded  this  as  a  way  of  creating  community  awareness  and  education  about  the   program  as  well  as  a  way  to  build  their  customer  base.     Businesses  with  specific  branded  products  were  split  about  whether  labeling  would   be  beneficial.  Wineries  and  breweries  thought  being  able  to  label  their  products  as   indicating  investment  in  a  PES  program  would  be  beneficial.  Other  similar   businesses  with  branded  products  did  not  think  labeling  would  be  beneficial  for   their  business  or  were  not  certain  about  the  benefit.   Page  |  20       Community  Planning  Workshop   Increasing program attractiveness Having  a  menu  of  choices  appears  to  be  essential  to  attract  business  investment  in   the  PES.   There  was  a  strong  consensus  from  participants  that  they  wanted  to  be  presented   with  a  well-­‐developed  PES  plan  that  identifies  who  will  be  benefiting  from  the   program;  why  they  should  participate;  the  connection  between  the  PES  program   and  their  business;  how  the  program  fits  into  their  business  mission  and  values;  the   tangible  benefits  for  their  business,  the  community,  and  the  environment;  and  a   plan  for  continual  monitoring  and  evaluation.   The  majority  of  participants  also  wanted  to  see  a  cost  benefit  analysis  of  the   program  so  that  they  could  see  that  the  program  made  sense  economically.   Participants  expressed  interest  in  seeing  the  costs  to  their  business  as  well  as  the   cost  of  implementing  the  entire  program  in  relation  to  the  benefits  to  businesses,   the  community,  and  the  environment.   The  majority  of  businesses  expressed  interest  in  having  a  more  participatory   approach  to  investing  in  the  program.  Many  of  the  businesses  said  they  would  be   more  likely  and  able  to  participate  through  product  and  service  giveaways  and   donation  of  labor  hours  than  though  a  strictly  monetary  investment.     Most  participants  recommended  having  different  levels  of  investment  as  well  as  a   variety  of  investment  options  available  to  business  investors.  Participants  agreed   having  options  would  encourage  and  allow  for  a  broader  range  of  business   investment.  Suggestions  for  different  investment  options  included  product  or   service  giveaways,  donation  of  employee  labor  hours,  discounts,  and  offering   guests  or  customers  the  choice  to  opt  in  or  opt  out  of  the  program.  In  this  way   business  are  able  to  decide  what  works  the  best  for  their  particular  business.     Along  these  same  lines  participants  recommended  a  smorgasbord  of  benefits   available  for  businesses  to  choose  from.  The  more  businesses  invest  in  the  program   the  more  benefits  they  are  able  to  choose  from.  Benefits  mentioned  by  participants   included:  spot  advertisements,  stories  in  local  newspapers  about  their  business  and   their  voluntary  investment  in  PES,  and  labeling  of  products  indicating  their   investment  in  PES.   Giving  businesses  choices  of  how  much  to  invest,  different  methods  of  investment,   and  types  of  benefits  enables  them  to  customize  their  participation  so  that  it  works   for  their  particular  business.     Labeling There  was  not  much  consensus  on  how  beneficial  labeling  of  products  or  having   logos  in  business  windows  would  be  but  most  businesses  said  that  it  should  be  one   of  the  options  available.  The  labeling  brand  should  emphasize  the  local  aspect  and   benefits  to  the  whole  watershed.  Participants  thought  that  emphasizing  the  whole   watershed  was  the  best  way  to  appeal  to  a  broad  audience.  Another   recommendation  was  to  partner  the  PES  program  with  other  McKenzie  River     Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  21   watershed  environmental  groups  such  as  the  local  watershed  council  to  create  a   universal  logo  that  is  more  recognizable  to  the  community.     Geographic Scope Overall,  those  participating  in  the  focus  groups  indicated  that  a  local  program   would  be  most  attractive  to  area  businesses.     Regional  and  national  businesses  did  not  express  the  same  importance  on  the   geographic  scope  as  local  businesses.  Most  of  the  representatives  from  regional   and  national  businesses  said  the  more  recognizable  the  program  was  the  better   and  something  on  a  larger  geographic  scale  would  potentially  benefit  their  business   more.  One  participant  from  a  regional  business  said  they  thought  the  program   would  lose  some  of  its  clarity  at  a  larger  geographic  scale.  On  the  other  hand,  at   least  one  national  business  indicated  significant  interest  in  such  a  program  as  their   business  model  emphasizes  local  partnerships  and  participation.   Focus  group  participants  from  local  businesses  indicated  they  would  be  less  likely   to  participate  if  the  program  were  at  a  larger  geographic  scale.  Most  of  the   participants  from  local  businesses  said  their  customers  are  primarily  members  of   the  immediate  community  and  their  businesses  would  benefit  the  most  from  a   smaller,  more  local  geographic  program  scale.   Watershed protection fee The  majority  of  participants,  except  for  one  representative  from  a  national   business,  thought  that  participating  in  a  PES  program  and  having  to  pay  a   watershed  protection  fee,  no  matter  how  small,  would  feel  like  a  “double   whammy”  (e.g.,  that  they  were  paying  twice—once  for  the  watershed  fee  and  once   as  a  corporate  contribution)  to  their  businesses.  Several  participants  recommended   that  businesses  choosing  to  participate  in  the  PES  program  automatically  have  the   watershed  protection  fee  waived.  Most  businesses  agreed  this  would  be  a  way  to   mitigate  the  feeling  of  being  charged  twice  for  the  same  purpose.   Barriers Businesses  identified  a  variety  of  barriers,  the  most  common  being  the  larger   investors  potentially  overshadowing  the  smaller  investors.  Businesses  recognized   the  need  for  an  education  component  to  the  program  so  that  the  community  is   aware  of  the  program  goals  and  how  the  program  is  different  than  their  potential   watershed  protection  fee.  Participants  also  identified  the  difficulty  that  they   already  have  in  choosing  certain  organizations  and  programs  to  donate  to  over   others  and  several  participants  expressed  interest  in  understanding  how   investment  in  PES  is  different  than  just  a  simple  donation.  This  program  will  be   thrown  into  the  mix  for  potential  investment  or  donation  and  it  will  be  extremely   important  to  identify  why  businesses  should  invest  in  this  program  rather  than   other  programs  and  organizations.   Participants  mentioned  several  times  that  there  is  a  tendency  with  the  push  for   green  products  and  services  for  companies  and  programs  to  participate  in  green   washing.  As  this  becomes  more  common  programs  such  as  PES  will  have  to  be   Page  |  22       Community  Planning  Workshop   extra  transparent  and  clear  what  the  goals  of  the  program  are  and  how  it  is  much   more  than  just  a  marketing  strategy.   Several  participants  also  identified  the  market  downturn  leading  to  their  businesses   having  fewer  funds  available  for  donations.  This  led  to  many  of  the  discussions  over   having  different  investment  levels  and  options  including  product  and  service   giveaways  that  are  often  more  economically  feasible  for  businesses.   In  all  focus  groups  participants  brought  up  the  fact  the  some  businesses  do  not   have  customers  that  are  swayed  by  environmental  issues.  Participants  that   expressed  this  concern  were  not  sure  how  they  could  capitalize  on  the  value  of  the   PES  program.       Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  23   CHAPTER 5: CONCEPTUAL CORPORATE FRAMEWORK This  conceptual  corporate  framework  presented  in  this  chapter  is  based  on  the   findings  from  the  business  engagement  focus  groups  as  well  as  landowner  surveys   and  focus  groups  that  were  conducted  as  part  of  the  larger  research  project  and   landowner  focus  groups  that  were  conducted  concurrently.  The  intention  is  to   provide  examples  and  a  broad  framework  for  building  a  business  investment   framework  for  a  PES  program.  Specific  details  of  building  an  actual  PES  program   that  incorporates  business  investment  will  have  to  be  decided  upon  based  on  the   community  and  the  types  of  businesses  the  program  is  trying  to  engage.   The  conceptual  framework  is  divided  into  three  components:  (1)  marketing   strategy,  (2)  program  implementation,  and  (3)  business  investment.  Business   investment  is  further  broken  down  into:  levels  of  investment,  methods  of   investment,  and  benefits  to  businesses.   Marketing Strategy To  appeal  to  different  types  of  businesses  at  a  variety  of  geographic  scales  with   unique  missions  and  goals  it  is  important  to  market  PES  programs  as  having  a   three-­‐fold  benefit  to  businesses;  ability  to  increase  business  sustainability  practices,   increase  businesses  social  impact  and  community  involvement,  and  highlight   tangible  benefits  investing  in  the  PES  program.   Investments  in  PES  programs  are  a  way  that  businesses  can  increase  their  level  of   participation  in  sustainable  business  practices.  This  is  important  to  businesses  that   have  sustainability  and  environmental  missions  and  goals  built  into  their  business   plan.  As  businesses  become  more  aware  of  potential  resource  scarcity  an   increasing  number  of  businesses  are  building  various  sustainability  practices  into   their  business  plans.  It  is  also  important  to  some  businesses  to  be    able  to  see  a   direct  tie  to  the  ecosystem  service  they  are  investing  in.  For  example  local   breweries  are  able  to  draw  a  direct  connection  between  the  quality  of  their   product  and  the  quality  of  the  water  they  are  using  to  produce  their  product.   Investments  in  PES  programs  are  also  a  way  that  businesses  can  increase  the  social   aspect  of  their  business  and  their  involvement  in  the  community.  This  concept   appealed  to  the  majority  of  business  representatives  across  geographic  scales  and   types  of  businesses.  Most  businesses  identified  community  involvement  and  other   social  programs  as  being  important  to  their  business  mission  and  goals.  National   businesses  saw  PES  and  other  locally  based  programs  as  venues  where  they  are   able  to  really  show  what  their  business  stands  for  and  create  community   awareness.  Local  business  representatives  saw  the  benefit  because  most  of  the   business  owners,  employees,  and  their  customers  are  all  a  part  of  the  local   community.  Based  on  local  business  and  national  business  perspectives  it  is   important  to  identify  the  benefits  to  the  local  community.   Page  |  24       Community  Planning  Workshop   For  all  businesses  it  is  important  to  see  the  tangible  benefits  of  the  program  and   understand  what  their  business  is  getting  out  investing  in  PES.  Businesses  identified   four  main  benefits  that  would  appeal  to  them:  ability  to  use  PES  investment  as  a   marketing  tool,  potential  to  build  customer  base,  direct  monetary  benefits,  and   benefits  to  the  local  community.  Examples  of  these  benefits  will  be  discussed  in   Benefits  to  business  investors.   Implementation All  business  representatives  expressed  a  desire  to  thoroughly  understand  the  PES   program  they  would  be  investing  in  and  recommended  PES  programs  having   certain  components,  including    monitoring  of  participating  landowner  properties   and  reports  on  achievement  of  transparent  goals  and  objectives.   Property evaluation Landowner  property  evaluation  strategies  and  descriptions  should  be  transparent   and  accessible  to  businesses.  The  majority  of  business  representatives  requested  a   thorough  description  of  which  properties  qualify  and  why.  Several  business   representatives  thought  pictures  of  eligible  properties  would  be  helpful  in   understanding  exactly  what  they  are  investing  in.  Business  representatives  also   stressed  the  importance  of  understanding  what  properties  are  not  eligible  and   what  these  properties  look  like  in  comparison  to  eligible  properties.  To  ensure   transparency  in  the  evaluation  process  potential  investors  should  have  access  to   the  evaluation  criteria  for  landowner  property.  Potential  investors  should  also  be   provided  with  descriptions  and  examples  of  properties  that  are  not  eligible.  For   example  most  businesses  were  relieved  to  hear  that  industrial  forest  landowners   were  not  an  eligible  recipient.  Other  possibilities  in  addition  to  pictures  are  videos   and  site  visits  to  the  area.   Monitoring Business  representatives  expressed  the  importance  of  a  monitoring  program  that   continually  evaluates  properties  that  are  receiving  benefits  from  PES  programs.   This  was  an  important  feature  during  the  course  of  the  program  so  that  investors   are  reassured  that  landowners  are  being  held.  This  was  also  an  important  feature   that  would  encourage  businesses  to  continue  to  invest  in  the  PES  program.   Reporting Many  businesses  indicated  that  some  sort  of  regular  reporting  on  program  progress   was  important  to  understanding  how  their  investment  makes  a  difference  and   would  likely  influence  their  decision  to  continue  their  investment.  Quantifying   program  activities  and  relating  them  to  program  goals  and  objectives  is  a  piece  of   this  reporting.  Miles  of  stream  with  quality  riparian  habitat  or  acres  of  floodplain  or   riparian  forest  land  being  protected  are  examples  of  metrics  to  track.  Reporting   could  also  incorporate  photo  monitoring  to  show  how  the  properties  look  over   time.       Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  25   Business Investment In  order  for  a  variety  of  business  types  ranging  in  size  and  economic  ability  to  invest   it  is  imperative  for  PES  programs  to  offer  an  investment  regime  that  can  be  tailored   to  individual  business  preferences.  The  three  components  of  PES  programs  that   were  of  particular  importance  to  business  representatives  were  levels  of   investment,  a  variety  of  methods  of  investment,  and  a  variety  of  benefits  that   investors  are  able  to  choose  from.     Levels of investment The  levels  of  investment  would  be  based  on  the  monetary  value  that  businesses   invest  in  the  PES  program.  The  variety  of  businesses  being  targeted  for  investment   may  determine  how  many  levels  of  investment  would  be  most  effective  for  the  PES   program.  To  ensure  the  greatest  success,  we  recommend  that  the  PES  program   offer  small,  local  businesses  a  level  of  participation  that  works  for  them  while  still   providing  something  in  return  that  they  see  as  beneficial  to  their  business.  We  also   recommend  offering  ample  incentives  to  encourage  larger,  national  businesses  to   invest  at  higher  levels.  Due  to  this  difference  the  levels  of  investment  should   correspond  directly  to  the  amount  of  benefits  that  businesses  are  offered  in  return   for  their  investment.   Potential  levels  of  investment  could  be  basic  tiers  like  bronze,  silver,  and  gold  or   could  be  based  on  an  adoption  scheme.  For  example  the  lowest  level  of  investment   might  allow  the  business  to  adopt  one  acre  of  riparian  area  while  the  higher  levels   of  investment  might  be  100  acres  or  more  of  riparian  area.  It  might  also  be  possible   to  partner  business  investors  with  particular  landowners.  For  example  one  business   or  maybe  a  group  of  businesses  could  adopt  one  landowner.  This  has  the  potential   to  create  partnerships  and  a  sense  of  community  between  the  urban  area  where   most  of  the  businesses  are  located  and  the  more  rural  upper  regions  of  the   watershed  where  most  of  the  landowners  with  riparian  forest  are  located.   Methods of investment Potential  business  investors  expressed  interest  in  non-­‐monetary  methods  of   investing  in  PES.  Business  representatives  said  that  this  is  generally  more   economically  feasible  for  their  businesses,  usually  requires  less  red  tape,  creates   more  of  an  opportunity  to  build  their  customer  base,  and  results  in  a  more   participatory  approach  that  gets  them  involved  in  the  community  and  the   community  more  aware  of  their  presence.  Potential  landowner  beneficiaries  of  the   program  expressed  a  similar  desire  to  be  offered  a  variety  of  non-­‐monetary   benefits.   Some  methods  of  investment  that  came  up  in  both  business  focus  groups  and   landowner  surveys  include:   • Provide  monetary  investment   • Discount  products  and  services  for  participating  landowners   • Giveaway  products  or  services  to  participating  landowners   • Sponsoring  community  event(s)   • Donating  employee  volunteer  hours  to  landowners   Page  |  26       Community  Planning  Workshop   • Providing  customers  an  option  to  opt  in  or  out  through  paying  more  for   membership  or  services   Monetary  investment  was  not  popular  among  business  representatives  or   landowners  but  as  a  simple  way  for  some  businesses  to  participate  this  should  still   be  offered  as  a  type  of  investment.  The  money  invested  could  be  used  to  fund  the   administrative  and  infrastructure  costs  of  a  PES  program.   This  list  of  methods  of  investment  is  not  comprehensive  and  potential  investors   should  be  given  the  opportunity  to  offer  other  methods  of  investment  that  meet   their  business  investment  capabilities.   Benefits to Businesses Business  representatives  all  expressed  varying  levels  of  interest  in  the  types  of   benefits  that  came  up  in  focus  group  discussion.  Some  participants  representing   product-­‐oriented  businesses  said  they  would  be  interested  in  environmental   labeling  of  their  products  while  others  were  not  interested  in  labeling  their   products.  It  is  because  of  these  types  of  differences  and  businesses  with  different   customer  bases  that  it  is  important  to  give  business  investors  the  opportunity  to   select  benefits  that  fit  their  business  needs.  Potential  benefits  for  business   investors  to  choose  from  include:   • Environmental  labeling  (includes  products,  services,  and  place  of  business)   • Spot  advertisements  (for  example  individual  business  stories  in  local   newspapers)   • Business  logos  and  advertisements  on  utility  newsletters,  descriptions  of   the  program,  and  local  events   • Potential  partnership  with  LEED  certification  programs   Again,  these  benefits  are  not  comprehensive  and  should  be  revisited  based  on  the   businesses  that  are  investing  in  the  PES  program.  What  is  especially  important  is   that  the  benefits  to  business  investors  correlate  to  their  investment  level  and  a   menu  of  options  are  available.  Business  representatives  wanted  more  and  varied   benefits  as  they  invested  more  in  the  program.  For  example  if  a  business  invested   at  the  lowest  level  they  would  get  to  choose  one  benefit  and  as  they  invest  more  in   the  program  they  are  offered  additional  benefits  with  the  highest  investors  being   offered  the  most  benefits.  Also  of  importance  is  that  the  business  investors  get  to   choose  the  benefit(s)  they  are  receiving  in  return  for  this  investment.       Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  27   REFERENCES Community  Planning  Workshop.  (2013).  An  Evaluation  of  Utility  Ratepayer  and  Landowner   Perceptions  of  a  Payment  for  Ecosystem  Services  Program  in  the  McKenzie  River   Basin.  Eugene:  Unviversity  of  Oregon  Community  Planning  Workshops.   Goldman,  R.  L.,  Thompson,  B.  H.,  &  Daily,  G.  C.  (2007).  Institutional  incentives  for  managing   the  landscape:  induing  cooperation  for  the  production  of  ecosystem  services.   Ecological  Economics,  333-­‐343.   Gutman,  P.,  &  Davidson,  S.  (2007).  The  Global  Environmetal  Facility  and  Payments  for   Ecosystem  Services:  A  review  of  current  initiatives  and  recommendations  for  future   PES  support  by  GEF  and  FAO  programs.  Payments  for  Ecosystem  Services  From   Agricultural  Landscapes:  PESAL  Papers  Series  No.  1.  WWF  Macroeconomic  for   Sustainable  Development  Program  Office  -­‐  WWF-­‐MPO.   Hanson,  C.,  Ranganathan,  J.,  Iceland,  C.,  Finisdore,  J.,  &  Finisdore,  J.  (2012).  Guidelines  for   Identifying  Business  Risks  and  Opportunities  Arising  from  Ecosystem  Change.  The   Corporate  Ecosystem  Services  Review:  version  2.0,  1-­‐48.   Hickson,  P.  (2012,  June).  Public  Utility  Districts  and  Payment  for  Watershed  Services:   Explaining  Water  Users'  Willingness  to  Pay.  in  partial  fullfillment  of  Master  of   Community  and  Regional  Planning  Degree.  University  of  Oregon  Department  of   Planning,  Public  Policy,  and  Management.   Mulder,  I.,  ten  Kate,  K.,  &  Scherr,  S.  (2006).  Private  Sector  Demand  in  Markets  for   Ecosystem  Services:  Preliminary  Findings.  Adapted  from  the  full  report  submitted  to   the  UNDP-­‐GEF  project:  "Institutionalizing  Payments  for  Ecosystem  Services',   Supplement  IV.  Mobilizing  Private  Sector  Buyers  of  Ecosystem  Service.   Parkhurst,  G.  M.,  Shogren,  J.  F.,  Bastian,  C.,  Kivi,  P.,  Donner,  J.,  &  Smith,  R.  E.  (2002).   Cooperation  Bonus:  an  incentive  mechanism  to  reunite  fragmented  habitat  for   biodiversity  conservation.  Ecological  Economics,  305-­‐328.   Perrot-­‐Maitre,  D.  (2006,  September).  The  Vittel  payments  for  Ecosystem  services:  a   "perfect"  PES  case?  International  Institute  for  Environment  and  Development  and   Department  for  International  Development.   Toombs,  T.,  Goldstein,  J.  H.,  Hanson,  C.,  Robinson-­‐Maness,  N.,  &  Fankhauser,  T.  (2011).   Rangeland  Ecosystem  Services,  Risk  Management,  and  the  Ranch  Bottom  Line.   Society  for  Range  Management,  13019.   Turner,  R.  K.,  &  Daily,  G.  C.  (2008).  The  Ecosystem  Services  Framework  and  Natural  Capital   Conservation.  Environmental  Resources  Economics,  25-­‐35.   Waage,  S.,  Armstrong,  K.,  Hwang,  L.,  &  Bagstad,  K.  (2011,  May).  New  Business  Decision-­‐ Making  Aids  in  an  Era  of  Complexity,  Scrutiny,  and  Uncertainty:  Tools  for   Identifying,  Assessing,  and  Valuing  Ecosystem  Services.  BSR's  Ecosystem  Services,   Tools,  and  Markets  Working  Group.  BSR.   Page  |  28       Community  Planning  Workshop   Waage,  S.,  Hwang,  L.,  &  Armstrong,  K.  (2012,  April).  The  Quiet  (R)Evolution  in  Expectations   of  Corporate  Environmental  Performance:  Emerging  Trends  in  the  Uptake  of   Ecosystem  Services.  BSR's  Ecosystem  Services  Working  Group.  BSR.   Waage,  S.,  Mulder,  I.,  ten  Kate,  K.,  Roberts,  J.  P.,  Hawn,  A.,  Hamilton,  K.,  .  .  .  Carroll,  N.   (2007).  Investing  in  the  future:  an  assessment  of  private  sector  demand  for   engaging  in  markets  &  payments  for  ecosystem  services.  FAO  and  Forest  Trends.   Zhang,  W.,  Ricketts,  T.  H.,  Kremen,  C.,  Carney,  K.,  &  Swinton,  S.  M.  (2007).  Ecosystem   Services  and  Dis-­‐services  to  Agriculture.  Ecological  Economics,  253-­‐260.           Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  29   APPENDIX A Recruitment phone script No  contact  person  identified   Hi  my  name  is  ____________________.  I  am  calling  from  the  Community   Planning  Workshop  at  the  University  of  Oregon.  We  are  reaching  out  to  local   and  national  businesses  with  a  local  presence  to  learn  more  about  business   perceptions  of  the  values  for  healthy  water  and  watersheds.  Would  you  be   able  to  put  me  in  touch  with  someone  at  your  business   (manager/owner/sustainability  coordinator)  that  might  be  interested  in   talking  with  me  and  perhaps  getting  more  involved  in  this  project?   Contact  person  identified   Hi  my  name  is_________________.  I  am  calling  from  the  Community   Planning  Workshop  at  the  University  of  Oregon.  I  was  referred  to  you   by_______________  who  thought  you  might  be  interested  in  a  project  I  am   working  on.  The  project  is  related  to  reaching  out  to  local  and  national   businesses  with  a  local  presence  to  learn  more  about  local  business  values   for  healthy  water  and  watersheds.  Is  this  a  good  time  to  talk,  or  can  I   contact  you  at  a  better  time  to  talk  more  about  the  project  and  how  you  can   get  involved?   Setting  up  an  informational  meeting  time:   • Date   • Time   • Best  contact  method   • Estimate  of  time  (plan  for  10-­‐15  minutes)   • Give  my  contact  information  (listed  below)   Informational  Meeting   The  purpose  of  the  information  meeting  is  to  talk  briefly  about  the  project   (see  description)  and  how  it  will  benefit  the  business  but  most  importantly   to  get  them  to  commit  to  attending  a  focus  group  to  discuss  their  opinions   and  learn  more  about  the  project.   Questions   1. Would  you  be  interested  in  participating  in  focus  groups  with  other  local   and  national  businesses  with  a  local  presence  to  discuss  the  following   topics:   • Local  ecosystems     Page  |  30       Community  Planning  Workshop   • Role  businesses  can  play  in  restoring  and  maintaining  our  local   ecosystems   • Benefits  to  the  community   • Benefits  to  the  local  businesses  that  participate   2. Do  you  have  any  recommendations  of  other  businesses  that  might  be   interested  in  participating?  If  yes,  who  might  we  contact  at  that   particular  business?   • Name   • Phone   • Email   Focus  group  dates:   They  can  choose  from  three  focus  group  times  all  will  be  held  at  a  TBD   location.   • Friday,  March  1   11:30am  –  1:30pm   • Tuesday,  March  5   2:30pm  –  4:30pm   • Wednesday,  March  6   11:30am  –  1:30pm   • Friday,  March  8   10:00am  –  12:00pm   If  you  can  get  a  commitment  over  the  phone  that’s  wonderful  otherwise  you   can  let  them  know  if  they  are  interested  we  will  send  out  an  official   invitation  and  RSVP  instructions  will  be  included  with  the  invite.   Information  to  record  if  they  are  committing  to  attend  a  focus  group:   • Name   • Business  they  are  representing   • Phone   • Email   • Which  focus  group  they  would  like  to  attend   Information  to  record  if  they  are  interested  in  attending  a  focus  group:   • Name   • Business  they  are  representing     • Phone   • Email   Explanation  of  our  project   Community  Planning  Workshop  is  partnering  with  the  National  Institute  of   Food  and  Agriculture  and  Public  Utilities  to  identify  a  possible  collaborative     Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  31   and  voluntary  pilot  program  that  engages  local  businesses  to  financially   assist  in  the  protection  and  restoration  of  local  watersheds  that  provide   basic  community  needs  such  as  food,  water,  clean  air,  biodiversity,  and   climate  regulation.     The  overall  goal  is  to  bring  together  private  and  public  sectors  to  develop   and  participate  in  investment  opportunities  that  promote  sustainable   resource  management  and  watershed  restoration  in  the  McKenzie  River   watershed.  Land  owners  and  land  managers  will  be  compensated  for   undertaking  sustainable  management  practices  and  restoration  activities.     Local  businesses  that  voluntarily  take  part  in  the  project  be  able  to:   Promote  themselves  as  a  participant  in  the  program  -­‐  a  business  that   promotes  healthy  watersheds  and  gives  back  to  local  resources.   Creating  networks  and  partnering  with  other  local  area  businesses   Another  strong  step  to  Oregon  becoming  a  leader  in  sustainability  actions   Explanation  of  Community  Planning  Workshop   Community  Planning  Workshop  is  an  experiential  learning  program  within  in   the  Department  of  Planning,  Public  Policy  and  Management  at  the   University  of  Oregon.  Students  get  real  world  experience  working  with   community  organizations  to  develop  possible  solutions  to  planning   problems  in  Oregon  communities.   If  you  have  further  questions  or  comments  about  scheduling  and  focus   group  logistics  please  contact:   Angela  San  Filippo  at  the  Community  Planning  Workshop   asanfili@uoregon.edu   (541)  499-­‐3841   If  you  have  further  questions  or  comments  that  are  related  to  the  project   itself  please  contact:     Robert  Parker  at  Community  Service  Center     (541)  346-­‐3801     rgp@uoregon.edu     Max  Nielsen-­‐Pincus  at  Institute  for  a  Sustainable  Environment     (541)  346-­‐0676     maxn@uoregon.edu     We  will  be  in  touch  in  the  next  week  with  an  official  time  and  date  of  focus   groups.  We  really  appreciate  you  taking  the  time  to  provide  your  insights;   Page  |  32       Community  Planning  Workshop   they  are  invaluable  to  our  project  and  will  help  us  to  be  more  effective  in   our  efforts.   Recruitment Email Script Dear  _______________,   My  name  is  ______________;  I  am  working  on  a  project  with  the  University  of   Oregon's  Community  Service  Center  and  EWEB.  I  am  working  to  engage  local   businesses  to  provide  input  and  insight  into  our  effort  to  develop  a  voluntary,   collaborative  program  that  partners  local  businesses  to  support  and  promote   healthy  watersheds.     In  order  to  gain  insight  from  local  businesses  we  are  holding  focus  groups  in  the   beginning  of  March,  please  see  attached  invitation.  We  have  three  dates  and  times   to  choose  from:   Friday,  March  1:  2:00pm  -­‐  4:00pm   Tuesday,  March  5:  2:30pm  -­‐  4:30pm   Wednesday,  March  6:  11:30am  -­‐  1:30pm     Friday,  March  8:  10:00am  –  12:00pm   The  goal  is  to  have  a  voluntary  program  in  place  that  allowed  businesses  in  the   Eugene  area  would  have  an  option  to  pay  a  little  higher  rate  in  order  to  directly   benefit  watershed  restoration  projects.   What  we  are  hoping  to  learn  from  these  focus  groups  is  business  perspectives  and   insight  into  how  this  program  should  be  developed  to  best  serve  our  local   businesses  that  we  are  looking  to  for  participation.   We  would  like  to  know  from  a  business  perspective  what  details  of  this  program   that  you  like  and  those  that  you  dislike  or  that  would  potentially  hinder  your   participation.  Our  goal  is  to  develop  a  program  that  not  only  promotes  healthy   watersheds  but  that  serves  local  businesses  in  a  positive  way  promoting  their   sustainability  efforts  and  marketing  strategies.   As  a  local  business  with  a  community  presence  your  insight  and  perspectives  would   be  extremely  helpful  in  our  effort  to  create  a  successful  program.  Please  let  me   know  if  you  or  one  of  your  colleagues  is  able  to  attend  one  of  the  focus  group  times   listed  above.   Sincerely,   _______________     Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  33   Focus group invitation     Page  |  34       Community  Planning  Workshop   APPENDIX B Program Overview Thank  you  for  agreeing  to  participate  in  the  upcoming  focus  group  on  business   support  for  water  quality  and  watershed  health.  We  are  looking  forward  to  your   insights  and  perspectives  about  the  importance  of  supporting  water  quality  and   watershed  health  to  your  business.     We  have  provided  some  basic  information  below  about  the  types  of  issues  we  will   touch  on  in  the  focus  group.  We  have  also  included  a  very  brief  questionnaire  that   we  will  ask  you  to  complete  and  turn  in  at  the  focus  group.   What  are  Ecosystem  Service  Markets?   Ecosystem  service  markets  offer  a  growing  opportunity  for  private  landowners  who   manage  their  land  to  provide  some  sort  of  environmental  service  like  clean  drinking   water,  wildlife  habitat,  or  carbon  sequestration.  Ecosystem  services  can  be  broadly   defined  as  any  benefit  of  nature  to  households,  communities,  or  economies.     Payment  for  ecosystem  or  environmental  services  is  the  practice  of  offering   incentives  to  farmers  or  other  private  landowners  in  exchange  for  managing  their   land  to  provide  some  sort  of  ecological  service.     EWEB’s  Voluntary  Incentive  Program  (VIP)   The  VIP  would  help  protect  water  quality  in  the  McKenzie  River  watershed   through  protection  of  streamside  forests  and  floodplains  by  paying  landowners  in   the  McKenzie  River  watershed  to  maintain  healthy  riparian  forest  lands  and   floodplains.  These  lands,  which  act  as  natural  filters,  help  protect  the  quality  of  our   community’s  sole  source  of  drinking  water.     In  addition  to  water  quality,  other  major  benefits  from  the  program  would  include   cost  avoidance  around  the  construction  of  a  new  water  treatment  that  would  have   to  be  passed  on  to  ratepayers  and  improved  habitat  for  native  fish  and  wildlife  and   endangered  salmon  and  steelhead.   Most  PES  programs  have  relied  on  government  funding.  We  are  exploring  a   program  model  whereby  public  utilities—in  this  case,  EWEB—  would  create   opportunities  for  businesses  to  invest  into  these  programs  in  exchange  for   acknowledgements,  marketing  benefits  and  business  sustainability  activities.     Who  would  be  eligible  for  funding?   Funding  provided  by  businesses  and  other  contributors  would  provide  a  revenue   source  for  landowners  within  an  established  stewardship  boundary  to  pursue   restoration  activities  and  avoid  development  along  streamside  forests  and   floodplains   Information  that  we  are  hoping  to  learn  from  you     Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  35   What  sorts  of  sustainability  activities  you  currently  have  and  how  you  think  about   sustainability  in  terms  of  how  you  do  business.   What  would  your  business  need  in  return  for  investing  into  the  VIP  program?   Marketing  and  recognition  may  be  an  obvious  opportunity.  What  type  of   recognition  would  your  business  benefit  from?  What  would  you  need  to  make  this   program  worth  your  investment?   The  following  are  some  examples  of  recognition  and  business  benefits:   • Stickers  or  posters  certifying  your  participation   • Labeling  rights   • Recognition  in  EWEB’s  newsletter   • Newspaper  advertising  listing  businesses  investing  in  local  watershed   health   • Tangible  accounting  of  the  benefits  of  the  program   What  hurdles  do  you  see  in  getting  a  business  like  yours  to  participate  in  a  program   like  EWEB’s  VIP?     We  are  looking  forward  to  engaging  with  you  and  learning  your  perspectives  on   ways  for  businesses  in  our  community  to  support  and  sustain  healthy  local   watersheds.  Please  complete  the  attached  questionnaire  and  bring  it  to  the  focus   group.   Please  feel  free  to  call  or  email  me  with  questions  you  may  have.  I  look  forward  to   meeting  you.   Questionnaire and Business Participant Responses Please  answer  the  following  questions  to  the  best  of  your  ability  and  bring  the   completed  questionnaire  to  the  focus  group.  Your  answers  will  help  us  to  ensure   we  are  reaching  out  and  engaging  with  a  broad  variety  of  businesses.   1. What  type  of  business  are  you  representing?           Answer Number Percent Distribution/production 1 6% Lodging 1 6% Manufacturing 2 12% Retail 8 47% Retail/service 2 12% Service 2 12% Wholesale  food  distributor 1 6% Total 17 100% Page  |  36       Community  Planning  Workshop   2. Is  there  a  culture  of  sustainability  in  your  industry?           3. Does  your  business  have  a  sustainability  champion/director  or  equivalent?         4. How  many  employees  does  your  business  employ?         5. What  is  the  geographic  focus  of  your  business?         Answer Number Percent No 7 41% Yes 9 53% All  of  us 1 6% Total 17 100% Answer Number Percent 1-­‐5 2 12% 6-­‐15 3 18% 16-­‐40 4 24% 41-­‐80 4 24% More  than  80 4 24% Total 17 100% Answer Number Percent local 6 35% local/regional 3 18% local/regional/national/multinational 1 6% regional 6 35% regional  (service),  multinational  (manufacturing) 1 6% Total 17 100% Answer Number Percent Minimal 1 6% Mixed 1 6% Not  typically  ,  organically  focused  food 1 6% Yes 14 82% Total 17 100%   Corporate  Perceptions  of  Engagement  in  PES  Program  Development   June  2013   Page  |  37   APPENDIX C Focus Group Structure and Discussion Questions Introductions     • Thank  you  for  attending   • Opportunity  for  us  all  to  introduce  ourselves   • Additional  copies  of  program  overview  and  questionnaire   • Overview  of  focus  group  structure  and  format   • Project  Overview   Focus  group  discussion  questions   Participants  are  asked  to  answer  question  1  in  turn.  Questions  2  through  9  have  an   open  discussion  format.   1. What  business  sustainability  activities  do  you  currently  have?  Do  you  think  of   your  sustainability  activities  as  part  of  your  core  way  of  doing  business?   2. Given  the  overview  of  PES  and  business  sustainability,  what  would  motivate   your  business  to  invest  in  a  water  quality  PES  program?   Examples:  In  line  with  business  mission,  solely  for   recognition/acknowledgement  benefits.   3. What  would  make  a  water  quality  PES  program  attractive?   4. What  product  are  you  buying?  Why  is  this  product  important  to  you?   5. What  kind  of  message/value  proposition  (including  “landscape  labeling)  would   be  beneficial  and  fit  in  with  your  business  image?   6. What  type  of  recognition/acknowledgement  or  other  value  for  purchase  would   be  attractive  to  you  and  your  business?   Examples:  stickers  or  posters  certifying  your  participation,  labeling  rights  -­‐-­‐  for   example,  something  similar  to  1%  for  the  planet  logo  (message/value   proposition  and  landscape  labeling),  recognition  in  EWEB’s  newsletter,   newspaper  advertising  listing  businesses  investing  in  local  watershed  health,   tangible  accounting  of  the  benefits  of  the  program.   7. Is  the  geographic  scope  of  this  program  important  to  you?  Would  you  be  more   or  less  likely  to  invest  if  the  funding  were  to  go  to  a  broader  area  such  as  the   Willamette  or  Columbia  rivers?   8. If  EWEB  were  to  add  a  small  watershed  protection  fee  to  monthly  charges   would  this  affect  your  willingness  to  make  a  voluntary  investment  to  the  VIP   program?   9. What  other  barriers/issues  exist  to  your  business’  participation  in  programs  of   this  nature?   Additional  comments,  questions,  or  things  that  you  would  like  to  discuss     Wrap-­‐up  and  thank  you  for  participating