YAKIMA, Wash. -- Kittitas County would purchase or lease water to allow new development to occur in the upper county area under a budget proviso likely to be approved during the Legislature's special session beginning Monday.

Pursued by state Rep. Judy Warnick, R-Moses Lake, up to $700,000 set aside for an upper Kittitas County groundwater study would be shifted and used on a water-banking system.

State Ecology officials and the county have been working on the concept for more than a month. It is similar to a program that has been tried successfully in Colorado.

The agency supports shifting the money away from the study to a program of purchasing and leasing water rights.

New domestic water users would pay into a revolving fund that would provide them use of water.

Those willing to transfer water would have a source of income.

Warnick said the water-banking system is a way to help both the homeowners and farmers who hold senior water rights.

"I hope this will be a help for people who have property who need to build and who are losing value and the window of opportunity to build," Warnick said.

A number of details remain to be worked out, including an agreement between the county and Ecology to recognize the need to offset new uses by obtaining current rights, a concept known as mitigation.

Senior water-right holders in the basin, including the Yakama Nation and irrigators, must approve the plan.

Use of the money to obtain water, however, is based on Ecology and the county reaching agreement by Sept. 30, something that has been elusive since the agency imposed a ban on new wells last July in the upper county because of the impacts on senior water rights and streamflows.

Kittitas County Commissioner Paul Jewell called the proposal a new approach to try to resolve the moratorium.

"Our goal is to end the moratorium," Jewell said. "That would be in our interest to do so. We are trying to address some of the needs and concerns to make that happen."

Conservation groups also called the proposal a step forward because it recognizes the link between surface water and groundwater and the need that new uses be mitigated in a basin where water is overappropriated.

"We are moving off the argument over whether there is any connection between surface and groundwater. That seems to be assumed here," said Rachael Paschal Osborn, executive director of the Center for Environmental Law and Policy, a Spokane group that called for a ban on new uses. "We are now into the question of how to mitigate. That is big progress."

Jewell said the water bank represents a way for the county and Ecology to move forward without waiting for the results of a groundwater study.

* David Lester can be reached at 509-577-7674 or dlester@yakimaherald.com.