SALEM — Oregon lawmakers are contemplating numerous tweaks to state law to discourage “water speculation” while improving the efficiency of water rights transactions and disputes.

Water speculation is the practice of applying for water rights but not developing them in the hope that their potential value will increase over time.

The practice is frowned upon under Western water law because it can tie up scarce water and prevent its legitimate use by irrigators and others.

To discourage water speculation, House Bill 3342 would give applicants five years to develop water rights — up from five years currently — but only allow a single two-year extension.

Under existing law, some outstanding water rights applications are extended numerous times without being developed, said Mark Owens, R-Crane, a chief sponsor of HB 3342.

“Some of these applications are over 35 years long. That’s not right. That’s water speculation,” Owens said during a recent legislative hearing.

The latest version of the 63-page bill contains a long list of other revisions to how water rights are administered, ranging from relatively minor technical fixes to more substantial changes to water law.

Organizations representing irrigators, municipal water users and conservation groups are generally supportive of provisions that would ease public notice requirements, switch from paper to electronic documents and facilitate credit and debit card payments for water rights transactions.

However, agricultural groups such as the Oregon Farm Bureau, Oregon Water Resources Congress and Northeast Oregon Water Association are urging the House Agriculture Committee to be careful about the impacts of more fundamental reforms.

“The sections need some more work and they need some more discussion,” said April Snell, executive director of the Oregon Water Resources Congress, which represents irrigation districts.

For instance, HB 3342 would allow the Oregon Water Resources Department to bypass the normal review process before denying water rights applications in areas where groundwater withdrawals are restricted.

Currently, the agency must still complete such reviews even if there’s no water available, which the bill’s backers say is “frustrating for applicants” while contributing to the backlog of cases being processed by OWRD.

Similarly, HB 3342 would allow OWRD to deny applications to transfer water rights applications into groundwater restricted areas in which withdrawals “may exacerbate water management issues.”

These “automatic denials” are “significantly problematic” for the Northeast Oregon Water Association, which represents irrigators and other water users in the region, said J.R. Cook, the group’s director.

The bill proposes a “de facto denial of review” by OWRD that could foreclose complex water transactions meant to improve groundwater quality and irrigation availability in the region, he said.

“It avoids the dialogue and debate about what needs to happen to solve a problem,” Cook said.

For example, there’s been no discussion about how such denials could affect “bioremediation” projects, in which polluted groundwater would be pumped out of an aquifer, to be replaced with clean river water, he said.

“It will take permits to fix problems in these areas,” Cook said. “The key substance of this bill has significant structural issues that will take quite a bit of time to work through.”

Organizations representing local governments and special districts expressed similar reservations about HB 3342 and urged the House Agriculture Committee to engage in more negotiations over the proposal.

The bill’s chief sponsors, Rep. Mark Owens, R-Crane, and Ken Helm, D-Beaverton, said they were open to discussions and expected further amendments to the legislation.

“This is an evolving process,” Helm said.