Historic settlements reached in 2023 between PFAS manufacturers 3M and DuPont, and water utilities across the country, are now resulting in billions of dollars in recoveries for public water systems facing the costs of PFAS impacts, including treatment upgrades, monitoring, and long‑term compliance obligations. Thanks to the Aqueous Film‑Forming Foam Multidistrict Litigation (AFFF MDL) against 3M, DuPont, and other AFFF manufacturers, water systems in the first wave of claimants have received substantial payment checks to mitigate PFAS in their source water. In 2026, the second and final wave of claimants can submit paperwork and secure their share of the settlements. This will be the last chance for water systems to participate.
The two waves, or phases, of the settlements were structured so that “Phase One” covered water systems that detected PFAS in their water sources before the end of June 2023, and “Phase Two” applied to systems that didn’t detect PFAS until after that date (and, for the 3M settlement, also served more than 3,300 people). Nationwide, Phase One claimants have already received most of their awards, and, unlike many class actions that deliver negligible benefits, these settlements provide substantial funding that will help thousands of water systems cover PFAS treatment costs and meet the EPA’s National Primary Drinking Water Regulations. For many utilities, this funding represents unprecedented financial relief. In fact, many utilities that participated in Phase One of the 3M and DuPont settlements are now receiving payments in the many millions of dollars.
Phase one deadlines have passed; phase two deadlines are coming in summer 2026
Unless they deliberately “opted out” (to preserve their right to file suit in the future), all eligible public water systems are included in the PFAS settlements. However, payments are not automatic: only systems that perform the required testing and file complete claims documentation by the official deadlines will be eligible for compensation. While time is running out for Phase Two water systems (those that detected PFAS after June 2023) to submit their claims, systems that move promptly can still do what’s needed to ensure they don’t miss out on settlement funds. To receive the settlements payouts, water systems should start immediately with three key actions: conducting testing, assembling documentation, and submitting claims. In addition, those systems in line to incur PFAS-related costs before August 1, 2026, should consider planning those expenditures to maximise their recoveries from the “Special Needs” funds of the settlements – hundreds of millions of additional money set aside for these claims.
The first step toward submitting a settlement claim is testing for PFAS at each individual wellhead or surface water intake
The first step toward submitting a settlement claim is testing for PFAS at each individual wellhead or surface water intake. It’s commonly believed that existing data from the Fifth Unregulated Contaminant Monitoring Rule (UCMR-5, a U.S. EPA program that requires public water systems to test their drinking water for a list of unregulated contaminants) will serve this purpose – and indeed, many systems are discovering new PFAS detections through UCMR-5 testing. However, UCMR-5 requires testing only at the distribution system entry points (which is where treated water is bound for area homes and businesses), while the 3M and DuPont settlements require testing of the actual sources (individual wellheads and/or surface water intakes). Therefore, many systems will need to conduct additional testing at each water source to meet the requirements of the settlements.
Detailed test results must be submitted to the claims administrator no later than July 31, 2026.
Phase Two water systems have just months to complete their testing and submit claims documentation. This timeline is not insurmountable, but utilities need to start thinking about these requirements immediately. To secure a share of the $14 billion settlements, which could be in the tens of millions of dollars for a single water system, claims must be submitted no later than July 31, 2026, for both the 3M and DuPont settlement.
Claims submissions require considerable data, including not only PFAS testing results for each water source, but documentation of the maximum production capacity and annual production of each source. This documentation is used to assign a score to each impacted source, which is in turn used as the basis for a distribution from what’s called the “Action Fund” of each of the settlements. The time necessary to assemble this documentation can be extensive, and many water systems have turned to expert legal assistance to ensure their claims are complete, accurate and submitted on time — and, just as importantly, that they result in the maximum available recovery.
Seek additional costs through the special needs fund
In addition to the Action Fund, another pool of money is available to municipalities and utilities that have spent or are in the process of incurring costs to remediate PFAS contamination. These costs may include designing or building treatment facilities, drilling new wells to replace contaminated ones, or buying replacement water to maintain safe service. Through the Special Needs fund, a water system that will have spent money on efforts to address PFAS detections in its impacted water sources by August 1, 2026, can apply for additional settlement funds. These utilities can be eligible for both the Action Fund and the Special Needs fund.
To secure a share of the $14 billion settlements, claims must be submitted no later than July 31, 2026, for both the 3M and DuPont settlement
To submit a claim to the Special Needs fund, applicants must provide detailed documentation that supports the costs and necessity of their remediation actions. For proactive municipalities and utilities that have already invested in PFAS mitigation, this program provides a critical chance to recover these often-unexpected expenses necessary to protect public health and water quality.
Make polluters – not ratepayers – pay cleanup costs
The PFAS settlements are intended to hold manufacturers accountable — not to replace or limit future federal funding — and they represent a rare chance for municipalities to recover meaningful dollars that can stabilise budgets, fund capital projects, improve treatment infrastructure, and ease long-term rate pressure on customers. But the window is closing quickly. Once Phase Two deadlines pass, systems that haven’t acted will permanently lose eligibility for millions in settlement funds — and for any future litigation against these manufacturers who, for decades, knowingly sold these hazardous compounds without providing warnings or safeguards. Phase One payouts already demonstrate just how substantial the recovery can be; Phase Two systems now have a clear, proven roadmap to capture similar gains.
For systems that move now, the potential impact is immense. Many cities across the nation have already received eight‑ and nine-figure payments in Phase One, illustrating the scale of what’s on the table for utilities affected by PFAS contamination. While the claims process can be complex, utilities that work closely with legal counsel and technical advisors on eligibility review, strategy, documentation, and filing are better positioned to maximise recovery and shift the financial burden from citizens to polluters, aligning settlement proceeds with long‑term regulatory and capital planning needs. Time is the limiting factor: every month of delay narrows the opportunity to secure these funds, shift the financial burden from ratepayers to polluters, and protect communities for decades to come.
