S3738

The MORE WATER Act (S.3738) was introduced by Senator Padilla (D-CA) on January 29, 2026, and had a subcommittee hearing on March 17, 2026. It remains in the Senate Committee on Energy and Natural Resources — early in the legislative process. The bill authorizes $450 million over fiscal years 2028-2032 for the large-scale water recycling and reuse program under the Infrastructure Investment and Jobs Act, and creates a new Water Conveyance Improvement Program. Critically, this is an authorization, not an appropriation. Actual funding requires separate annual appropriations bills — no money has been allocated. The money trail runs through competitive grants administered by the Secretary of the Interior (Bureau of Reclamation) to eligible entities in the 17 western Reclamation States for feasibility studies, planning, design, and construction of large-scale water recycling and conveyance projects. California, as the largest Reclamation State with chronic drought pressure, is the primary geographic beneficiary. The structural winner is California Water Service Group ($CWT), the largest publicly traded water utility in California. CWT's capital investment plan includes recycled water infrastructure; federal grants reduce the capital burden on ratepayers and improve rate base efficiency. Essential Utilities has limited exposure as its regulated utilities are primarily in non-Reclamation states. Pentair ($PNR) and Eaton ($ETN) were previously cited as having indeterminate exposure — PNR's 12.27% 7-day decline and ETN's 18.38% 30-day rally are driven by factors unrelated to this early-stage bill. Actual market data shows CWT at $44.64 on April 30, 2026, down 3.75% in 7 days and down 1.54% in 30 days, trading near the bottom of its 52-week range ($41.29-$51.15). No price catalyst is attributable to this bill. WTRG at $40.40 is up 2.23% in 7 days, near the top of its 52-week range ($36.32-$42.37), driven by general utility sector trends, not water legislation. The legislative timeline: the bill needs to pass out of committee, pass the Senate, pass the House, and be signed into law — all before any appropriations can be considered for FY2028.