GRANTS PASS, Ore. (AP) — Plans to restore marshes on the northern end of Upper Klamath Lake, proposed as part of the long-term solution to Klamath Basin battles over sharing scarce water between farms and fish, are moving forward.

The Barnes Ranch has figured in plans to restore water quality and fish habitat in Upper Klamath Lake since a drought in 2001 forced the shut-off of irrigation to about 1,000 farms on the Klamath Reclamation Project to provide water for endangered suckers in the lake and threatened salmon in the Klamath River.

The 2,671-acre ranch is on marshland that was diked and drained to create cattle pasture. The last two years, the U.S. Bureau of Reclamation has been leasing the property and flooding it to increase the storage capacity of Upper Klamath Lake, which is the primary reservoir for the Klamath Reclamation Project and the source of the Klamath River.

Upper Klamath Lake has long been plagued by poor water quality due to agricultural runoff and algae blooms robbing the water of oxygen. Major fish kills occurred in 1995, 1996 and 1997. Poor water quality extends down the Klamath River, where low and warm water conditions spread gill rot diseases that killed tens of thousands of adult chinook salmon in 2002.

It is hoped that by restoring marshes around the lake, they will naturally filter water running into the lake, and provide places for young suckers to hide from predators.

An earlier effort by another organization to buy the ranch for $9 million and sell it to the government fell through.

The Nature Conservancy was approached by the Bush administration last year about reviving the project, said Stern. They reached an agreement with the Barnes family last winter to buy the ranch for $7.25 million.

Sen. Ron Wyden, D-Ore., and Sen. Gordon Smith, R-Ore., said they inserted a $2.5 million appropriation toward the purchase of the ranch in the pending Interior appropriations bill.

If the new appropriation is enacted, it will be combined with $4 million appropriated in 2006, falling short of the purchase price, Stern said. The Nature Conservancy is working to fund the difference through a private foundation, he added.

The Nature Conservancy hopes to close this fall on the purchase of the Barnes Ranch and sell it to the federal government in 2007 so that it can become part of the Upper Klamath Lake National Wildlife Refuge, Mark Stern, director of the Nature Conservancy's Klamath Conservation Area, said from Portland.

Once the ranch is taken over by U.S. Fish and Wildlife Service, plans call for removing the dikes and allowing the lake and marsh to move back in, said refuge manager Ron Cole.