Oregon’s water supply development fund is closer to becoming functional now that regulators have proposed rules for its operation that may be finalized in mid-June.

Meanwhile, state lawmakers are considering upping the fund’s size from the already-approved $10 million to $16 million, along with a bevy of other water proposals.

The fund was created by the Oregon Legislature in 2013 but hasn’t yet dispensed any money because irrigators, conservationists and others have been negotiating the environmental conditions that will apply to projects.

Storage projects must dedicate 25 percent of their water for in-stream uses under the law, which is intended to help fish.

They’re also subject to “seasonally varying flow” restrictions that determine how much water can be withdrawn outside the regular irrigation season without disrupting watershed function.

Details about “seasonally varying flow” requirements and other aspects of the fund’s operation were hammered out by two task forces in 2014 and early 2015, with that information now being incorporated into proposed rules written by the Oregon Water Resources Department.

Under the rules, projects will be subject to increased scrutiny depending on their impact to streams and how much environmental data is available about the waterway.

The proposed rules were recently made available for public comment, with OWRD scheduled to hold five rule-making hearing around the state between May 18 and May 22. The Oregon Water Resources Commission is expected to consider adopting the regulations during its June 18-19 meeting.

During negotiations, irrigator groups were concerned that the environmental conditions associated with funding could be too onerous for project developers to apply for funds.

The complexity of the rules remains a concern for Sen. Chuck Thomsen, R-Hood River, who was involved in passing Senate Bill 839, which created the water supply development fund.

Environmental restrictions were necessary to get the legislation passed in a Democrat-controlled legislature, but it remains to be seen if projects will be able to meet the 25 percent in-stream use requirement and the “seasonally varying flow” conditions, he said.

“They just take the common sense out of it,” Thomsen said.

The conditions placed on water projects will make them more expensive to build at a time when Oregon doesn’t have enough reservoirs to store water when it is available, he said.

“We’ve relied on snow pack for so many years. If it’s not going to be there, we’ve got to have a back-up,” Thomsen said.

At this point, it’s important to simply get the water supply development fund up and running to assist project that can work under the proposed rules, said JR Cook, director of the Northeast Oregon Water Association, who is trying to improve irrigation systems in the region and who participated in the negotiations.

Once the fund is operational with a track record, lawmakers can later make “tweaks” to ensure it functions better, Cook said.

“It requires baby steps,” he said. “We can’t fix it all at once.”

The Oregon Water Resources Department is persuading lawmakers to authorize $50 million in bonds to pay for the state’s integrated water resource strategy, which includes an additional $6.25 million for the water supply development fund.

Of that proposal, $30 million would be allocated for loans and roughly $14 million for feasibility studies and other water funding projects.

The response from lawmakers has generally been positive, though time will tell how much political wrangling the $50 million package will undergo, said Richard Whitman, natural resources policy director for Oregon Gov. Kate Brown.

Ideally, the water funding will soon be approved as a standalone bill, separately from broader bond funding discussions later in the legislative session, he said.

“If it moves earlier, it tends to be more straightforward,” Whitman said.

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