The proposed bill establishes a pilot water conservation program in Wyoming, aimed at reducing water consumption within the state's portion of the Colorado River basin and fulfilling interstate compact obligations. It outlines a detailed application and approval process for conservation projects, which must be voluntary and approved by the state engineer. The bill includes provisions for public notice, comment periods, and an appeal process for those affected by the decisions made regarding these projects. Additionally, it specifies that no conservation project shall cause the involuntary regulation of other water rights and ensures that no loss or impairment of water rights will occur as a result of participation in the program.

The bill also authorizes the state engineer and the Wyoming water development office to store conserved water in Fontenelle Reservoir and outlines the purposes for which this water can be released. To support the implementation of the program, the bill appropriates $510,000 and authorizes two additional full-time positions for the state engineer until June 30, 2028. Furthermore, it mandates the state engineer to report on the program's operation by October 1, 2031, and establishes a sunset date for the program, prohibiting new conservation projects after July 1, 2032. The legislation aims to address the ongoing drought conditions in the Colorado River basin and enhance Wyoming's water management strategies.