In Dutch oven, combine beans and 2 quarts (8 cups) of the water. Cover; soak at room temperature for at least 8 hours or overnight.
Drain beans, discarding liquid. In same Dutch oven, combine beans and remaining 2 quarts water. Bring to a boil over high heat. Reduce heat; simmer 1 hour or until beans are tender.
Heat oven to 300°F. Spray 3-quart casserole with nonstick cooking spray. Drain beans, reserving 3 cups of the liquid. In large bowl, combine reserved 3 cups bean liquid, bell pepper, bacon, onion, salt, mustard, pepper and molasses; mix well. Pour into sprayed casserole. Cover.
Bake at 300°F. for 4 hours, adding up to an additional 1 cup water as needed. Remove from oven. Uncover; arrange franks over beans. Return to oven; bake, uncovered, an additional 20 to 30 minutes or until franks are thoroughly heated.