1. (1) When the Department receives an application for allocation of conserved water, the Department shall: review the application to determine if the applicant has included the information required under OAR 690-018-0040, all fees have been paid, and if the water rights that will be modified by the proposed allocation of conserved water are water uses subject to transfer as defined in ORS 540.505(4) and OAR 690-018-0020(11).
2. (2) If the Department determines that the application does not include the required information or fees, or that the water rights that will be modified by the proposed allocation of conserved water are not water uses subject to transfer, the Department shall return the application and any fees to the applicant along with a written description of the deficiencies in the application.

3. (3) If the Department determines the application is complete, all fees have been paid, and the water rights that will be modified by the proposed allocation of conserved water are water uses subject to transfer, the Department shall file the application and undertake an initial review of the application to determine:

   1. (a) If the proposed allocation of conserved water will result in a reduced diversion for the uses allowed under the original water rights;
   2. (b) If the proposed allocation of conserved water will harm existing water rights;
   3. (c) If the application is consistent with the requirements established in OAR 690-005-0045 (Standards for Goal Compliance and Compatibility with Acknowledged Comprehensive Plans);
   4. (d) The quantity of conserved water needed to mitigate for harm to existing water rights and the quantity of conserved water that may be allocated;
   5. (e) The new rate and duty for the existing water rights and for any out-of-stream use of the conserved water rights;
   6. (f) In consultation with the Departments of Fish and Wildlife, Environmental Quality and Parks and Recreation, if conserved water is needed to support instream uses;
   7. (g) The amounts of water to be allocated to the applicant and, if needed, to the state for an instream water right based on the project costs and the amount of non-reimbursable public funds to be used for the project consistent with ORS 537.470(3) and OAR 690-018-0012(1);
   8. (h) The areas within which the conserved water may be used for out-of-stream purposes and the stream reaches to which the conserved water may be dedicated for instream purposes;
   9. (i) The periods to be allowed for the applicant to file a notice of completion of the conservation measures and to request that the allocation be finalized pursuant to OAR 690-018-0062. The time allowed between filing the notice of completion of the conservation measures and requesting that the allocation be finalized shall not exceed five years; and
   10. (j) Any other conditions or limitations to be included in the new water rights or tied to the use of the applicant’s portion of conserved water, including but not limited to conditions or limitations to prevent or mitigate for harm to existing water rights or to prevent enlargement by the measurement, recording, and reporting to the watermaster the amount of water diverted and used under the applicant’s reduced rate and duty water right certificate for the lands involved in the application and under the applicant’s portion of conserved water, as applicable.
4. (4) Upon completion of the review outlined in section (3) of this rule, the Department shall provide by electronic means, or if requested by regular mail, a copy of the initial review to notify the applicant of its preliminary determinations, identify any outstanding information that is necessary to continue processing the application, and allow the applicant a period of at least 30 days to examine the initial review and address any issues in the initial review.

5. (5) Concurrent with the issuance of the initial review outlined in section (4) of this rule, the Department shall give notice of the initial review and accept written public comments for 20 days by:

   1. (a) Publishing notice of the initial review in the Department’s weekly public notice; and
   2. (b) Except for those already provided notice of the application under subsection (a) of this section, providing notice by electronic means to any individuals, organizations, governmental agencies including Indian Tribes, local government planning departments, irrigation districts in the area, and parties that the Director determines should be notified, unless  a recipient has requested notification and that the notice be sent by regular mail.
6. (6) After conclusion of the time specified in OAR 690-018-0050(4) for the applicant to examine the initial review and for the public comment period described in OAR 690-018-0050(5), the Department shall consider applicant feedback and written public comments. Adjustments determined necessary by the Department shall be documented and incorporated into the proposed final order under section (7) of this rule.

7. (7) The Department shall issue a proposed final order of the determination made under section (3) of this rule, including any adjustments deemed necessary by the Department pursuant to section (6) of this rule. Based upon the Department’s determination, if the proposed final order:

   1. (a) Recommends approval of the water conservation project under the application, then the proposed final order shall include conditions that provide for:

      1. (A) The establishment of the dates pursuant to OAR 690-018-0050(3)(i) by which the applicant must:

         1. (i) Complete the conservation measures under the project and file notice of the completion with the Department; and
         2. (ii) Finalize the project and file a request for finalization with the Department;
      2. (B) Upon issuance of an order approving completion of the project, the cancelation of the original water right certificate that is to be modified by the allocation of conserved water; and
      3. (C) Following issuance of an order approving finalization of the project, the issuance of a certificate superseding the original certificate at the reduced rate and duty, a remaining right certificate for the lands not involved in the application, if applicable, and the allocation of the conserved water, all of which shall be contingent upon completion of the proposed project and satisfactory proof of use of the conserved water pursuant to OAR 690-018-0062;

   2. (b) Recommends approval of the water conservation project under the application as well as completion of the project, then the proposed final order shall include conditions that provide for:

      1. (A) The establishment of the date, not to exceed five years as set forth in OAR 690-018-0050(3)(i), by which the applicant must finalize the project and file a request for finalization with the Department;
      2. (B) Cancelation of the original water right certificate that is to be modified by the allocation of conserved water; and
      3. (C) Following issuance of an order approving finalization of the project, the issuance of a certificate superseding the original certificate at the reduced rate and duty, a remaining right certificate for the lands not involved in the application, if applicable, and the allocation of the conserved water, all of which shall be contingent upon completion of the proposed project and satisfactory proof of use of the conserved water pursuant to OAR 690-018-0062; or

   3. (c) Recommends approval of the conserved water project under the application as well as completion and finalization of the project, then the Department shall include conditions that provide for cancellation of the original water right certificate  that is to be modified by the allocation of conserved water and shall, following issuance of the proposed final order, also issue the following draft certificate(s), as applicable, to supersede the original certificate and allocate the conserved water:

      1. (A) The applicant’s reduced rate and duty water right for the lands involved in the application;
      2. (B) The remaining right for the lands not involved in the application;
      3. (C) The state’s instream water right reflecting the state’s portion of the conserved water to be put instream consistent with ORS 537.470(3); and
      4. (D) If the applicant is proposing to permanently dedicate all or a portion of their conserved water to the state, then the amount dedicated to the state may be added to (C) of this subsection consistent with ORS 537.470(3).
8. (8) The Department shall send the proposed final order to the applicant by registered or certified mail in accordance with ORS 183.415. The proposed final order shall include a statement of the opportunity to protest the Department’s determination. The Department shall provide notice of issuance of the proposed final order by providing a copy of the proposed final order to any other person requesting notice and to each person who commented on the application for allocation of conserved water in response to the public notice under section (2) of this rule. Notice shall be provided by electronic means unless the recipient has requested that the notice be sent by regular mail.
9. (9) In accordance with OAR 690-002-0220, any person may file a protest against the proposed final order within 45 days after notice of issuance of the proposed final order. Protests, requests for party status, and contested case proceedings are governed by Or Laws 2025, ch 575 and OAR Chapter 690, Division 002. Proposed final orders shall become final if no protest is filed or by default as provided in OAR 690-002-0235. In addition to any other authority the Department may have, if a protest is properly filed, the Department may work with the applicant and the person filing the protest to determine whether the issues raised by the protest can be resolved informally.
10. (10) In the event of a land use dispute, as defined in OAR 690-005-0015 (Definitions), the Director shall follow resolution procedures provided in 690-005-0040 (Resolution of Land Use Disputes).

Statutory/Other Authority

ORS 536.025, ORS 536.027 & ORS 537.480

Statutes/Other Implemented

ORS 537.455 - 537.500, ORS 536.045, Or Laws 2025, ch 575 & Or Laws 2025, ch 282

History

WRD 3-2026, amend filed 03/20/2026, effective 04/01/2026
WRD 1-2012, f 1-31-12, cert. ef. 2-1-12
WRD 7-2004, f. & cert. ef. 11-5-04
WRD 15-1994, f. & cert. ef. 12-23-94
WRD 5-1991, f. & cert. ef. 4-26-91
WRD 12-1990, f. & cert. ef. 8-8-90
WRD 3-1990, f. & cert. ef. 2-28-90
WRD 19-1988, f. & cert. ef. 11-4-88