Water Code. 
Washington operates under a water right permit system.  With certain exceptions, new rights to use surface or ground water must be established according to the permit system.  A person seeking a new water right must file an application with the Department of Ecology (Ecology), which must then consider a four-part test when deciding whether to issue the requested right:  (1) whether water is available; (2) whether a beneficial use of water would be made; (3) whether granting the right would impair existing rights; and (4) whether the proposed use would detrimentally affect the public welfare.

The Trust Water Rights Program. 
The state may acquire a trust water right by donation, purchase, or lease.  Trust water rights are placed in the state's Trust Water Rights Program and managed by Ecology.  Two trust water rights systems, one for the Yakima River basin and the other for the rest of the state, are established in state law.

The Trust Water Rights Program enables the voluntary transfer of water and water rights to the state, either temporarily or permanently. While a water right is held in trust, it is considered an exercised water right and is protected from relinquishment.  Water held in trust retains its original priority date.

Water Banks. 
The process to establish a water bank begins with a consultation between Ecology's Water Resources Program and a would-be banker.  If Ecology agrees that the banker's proposal is in the public interest, a water banking agreement may be negotiated.  This agreement describes how Ecology will take ownership of a water right and hold it in the Trust Water Rights Program in exchange for processing applications for mitigated new uses.

Ecology is authorized to use water banking to mitigate for new water uses, hold water for beneficial uses consistent with terms established by the transferor, meet future water supply needs, and provide a source of water to third parties, on a temporary or permanent basis, for any allowed beneficial use.

Walla Walla Pilot Local Water Management Program.
The Walla Walla Pilot Local Water Management Program was created through legislation passed in 2009. As part of the legislation, a local water management board was created, with representatives drawn from city and county government, federally recognized Indian tribes, conservation districts, and water rights holders. 
The Walla Walla Water Management Board (Board) is authorized, among other duties, to establish a water bank in which surface water and groundwater right holders may deposit their water rights on a permanent or temporary basis.  The Board may manage those water rights in order to mitigate for impairment to instream flows and other existing water rights.
 
Expiration of Walla Walla Pilot Local Water Management Program.
The Walla Walla Pilot Local Water Management Program was initially scheduled to expire in 2019.  In 2019, legislation was enacted that moved the expiration date for the program to June 30, 2021.

Upon a request made by a water right holder to the Department of Ecology (Ecology) on or before June 30, 2021, a water right banked as part of the Walla Walla Pilot Local Water Management Program must be accepted by Ecology as a temporary trust water right donation for a period of up to two years, in the same quantity that the water right was banked as part of the Walla Walla Pilot Local Water Management Program.