This paper examines the implications of tenancy legislation and privatization of community lands in Goa on the supply of local public goods for soil conservation. In the post-tenancy period our survey reveals an increasing number of farmers being affected by salinity ingress. These findings support the hypothesis that when community institutions break down, individual agents who become new resource owners do not have sufficient incentive to undertake supply of local public goods, which leads to a decline in productivity and affects long-term sustainability.