The existing measure, which will appear on the November ballot as Proposition 43, passed in 2009 under then-Gov. Arnold Schwarzenegger but has been delayed twice. Most lawmakers have agreed it is too large and contentious to win voter approval, but they have struggled to find a compromise.
"The most difficult thing about this whole discussion is it took six years last time," said Assembly Republican Leader Connie Conway, who served during the last negotiations. "It's like a telenovela with really ugly actors: It's drama, drama, drama."
A replacement water bond requires support from Gov. Jerry Brown and two-thirds of lawmakers in each house, including Republicans in the Senate, where Democrats are short of a supermajority. All are under pressure from environmentalists, farmers, water exporters and trade unions, among other interests.
The most contentious issues for legislators to overcome include paying for water-storage projects and a provision seen as promoting Brown's delta tunnel project in Northern California to divert water to farms and residents in the south.
Brown, running for re-election on a platform of fiscal restraint, has pushed for a $6 billion bond. That leaves legislative leaders feeling pulled in opposite directions as they seek to cut spending while appeasing interests to win votes.
Senate Democrats unveiled a $7.5 billion plan for water projects Thursday, after a larger plan failed to pass a floor vote last week. But the plan reduces funding for storage, and supporters say it takes a neutral position on the tunnels. Both are sticking points for Republican lawmakers.
"In the water world, you can't always get everything you want," said Senate President Pro Tem Darrell Steinberg, D-Sacramento.
Meanwhile, negotiations have stalled in the Assembly. The deadline to change the ballot measure is sometime in August.