Droughts, hurricanes, floods and other severe weather events are threatening many US cities' financial stability, as illustrated by Clyde, Texas -- which defaulted on municipal bonds after a prolonged dry spell. At least 43 states have experienced drought conditions this year, and the cost of managing them, much less taking preventative measures, is more than many communities can bear. There is also less federal relief for droughts than for other natural disasters. The First Street Foundation estimates that 11.1 million people will move due to limited water supplies by 2055.

The Texas Commission on Environmental Quality has approved a permit for a wastewater facility for the Guajolote Ranch project in Bexar County, despite opposition from residents and officials who are concerned about potential contamination of the Edwards Aquifer. The development, led by Lennar Homes, aims to build 3,000 homes on 1,100 acres. The Scenic Loop-Helotes Creek Alliance plans to challenge the decision through legal action and legislative efforts.

The Bureau of Reclamation has chosen Utah's Washington County Water Conservancy District as one of only five recipients of federal funding aimed at water-saving projects in the West. The support will help the county build an innovative water reuse system that is recognized nationally for its potential to transform previously unusable water into new supplies, thus helping the region manage drought and prepare for future growth.

Six years after a tunnel collapse and canal breach ceased water deliveries in Nebraska and Wyoming for a month and a half, construction will start this fall on a replacement for Tunnel No. 2 The project, which is expected to cost $150 million, will use a purpose-built sequential boring machine to enlarge the tunnel and install precast concrete sections. Work on Tunnel No. 1 is expected to begin in late 2027, with both tunnels scheduled for completion by spring 2028.

American Water Works and Essential Utilities have agreed to merge in an all-stock transaction to form the largest regulated water and wastewater utility in the US, with an enterprise value of about $63 billion and a combined market capitalization of about $40 billion. The combined company, which will retain the American Water name, will serve 4.7 million water and wastewater connections in 17 states and 18 military installations. The deal is expected to close in the first quarter of 2027.