Federal News
DOI Awards $540M for California Water Infrastructure
March 18, 2026
The U.S. Department of the Interior has awarded $540 million in federal funding to support critical water infrastructure projects across California's Central Valley, announced in March 2026. This funding targets major canal rehabilitation, subsidence correction, reservoir expansion, and conveyance improvements including the Delta-Mendota Canal, Friant-Kern Canal, San Luis Canal, Tehama-Colusa Canal Authority pumping plant, and Shasta Dam and Reservoir Enlargement Project. The investment aims to enhance water reliability and storage capacity vital for agriculture and community water supply amid ongoing water availability challenges.
- This funding represents the largest single federal investment in California water infrastructure to date, signaling increased federal commitment to modernizing aging water delivery systems.
- Procurement professionals should anticipate multiple contracting opportunities related to canal rehabilitation, dam expansion, and pumping plant upgrades in California's Central Valley.
- Contractors with expertise in water infrastructure, civil engineering, and environmental compliance will find significant demand for services supporting subsidence repair and capacity enhancements.
- Stakeholders should note ongoing legislative advocacy for additional funding, indicating potential future procurement expansions in this sector.
After nearly a year of work, I'm proud to announce California will receive $540 million to support critical storage and conveyance projects across the statethe most significant water investment California has ever seen.
— David Valadao, U.S. Congressman
As we celebrate National Ag Week, Im pleased to see the Department of the Interiors announcement of critical investments in water infrastructure that Ive long fought for in the San Joaquin Valley. For decades, Ive worked to improve water reliability across the region, because where water flows, food growsand a secure, dependable water supply is critical not just for the Valley, but for our nations food security. These projects will restore capacity, fix subsidence issues, and are vital to keeping water flowing for our local farms and ensuring families and communities in the Valley have the water they need today and for generations to come.
— Congressman Jim Costa
Federal investments in Central Valley water infrastructure are crucial for our regions agricultural economy. While the funding announced this week is a step in the right direction, additional resources are necessary to ensure a reliable water supply throughout California. That is why when the House was considering the OBBBA last year, I proposed an amendment to fund the projects authorized in my Central Valley Water Solution Act at $8 billion. Unfortunately, the amendment was opposed by both Republicans and Democrats in the House. In the months ahead, I will continue to educate and work with my colleagues to pass my water legislative package and secure higher funding for water projects throughout the state.
— Congressman Adam Gray
Agencies
Department of the Interior, U.S. Congress, U.S. House of Representatives, Bureau of Reclamation, House Natural Resources Committee
Contracts
$540 million, $40 million, $200 million
Locations
Sources
- Fong Announces $540 Million in Federal Funds Secured for CA Water Projects | Congressman Vince Fong · FONG · Mar 17
- Congressman Valadao Celebrates Critical Investments in California Water Infrastructure | U.S. Congressman David Valadao · Valadao · Mar 17
- Costa Statement on $540 Million for Central Valley Water Projects | Congressman Jim Costa · Costa · Mar 18
- GRAY CELEBRATES CALIFORNIA WATER INFRASTRUCTURE INVESTMENTS, CALLS FOR MORE RESOURCES | Congressman Adam Gray · GRAY · Mar 18