Section 1926(b) Protection Requires Timely, Responsive Service After a Request—Years of Inaction Defeat “Made Available”

1. Introduction

Dupont Water Company, Inc. v. City of Madison, Indiana (7th Cir. Aug. 5, 2026) addresses when a federally indebted rural water association may invoke the anti-encroachment protections of 7 U.S.C. § 1926(b). Jefferson County, Indiana built a new jail on an undeveloped site near Madison. Two suppliers were plausible: the City of Madison (a municipal utility with a nearby 12-inch main) and Dupont Water Company (a USDA-indebted rural water association with a smaller 3–4 inch main at the property).

The central issue was whether Dupont had “provided or made available” water service to the jail—an element that triggers § 1926(b) protection—when, despite years of communications, Dupont neither built necessary infrastructure nor delivered a rate quote or contract. Dupont sued Madison (and Jefferson County intervened) after Madison ultimately provided water to the jail.

2. Summary of the Opinion

3. Analysis

A. Precedents Cited

1) Jennings Water, Inc. v. City of North Vernon, 895 F.2d 311 (7th Cir. 1989)

Jennings Water is foundational Seventh Circuit authority on what kinds of municipal activity § 1926(b) forbids. Although acknowledging the text expressly targets encroachment through annexation or private franchising, Jennings adopted a “liberal interpretation” that prohibits broader “curtailment or limitation” of the association’s service—effectively permitting § 1926(b) claims against municipalities that sell water to customers in the association’s protected area.

In the present case, the court did not revisit Jennings’s breadth because Dupont lost on the threshold “made available” requirement. But Jennings’s expansive approach mattered as the background assumption: if Dupont had established “made available,” Madison’s sale could have been actionable under Seventh Circuit precedent.

2) Washington County Water Co. v. City of Sparta, 77 F.4th 519 (7th Cir. 2023)

Washington County Water Co. supplies the controlling test for “provided or made available.” The Seventh Circuit adopted a two-pronged “physical capability” framework:

• Pipes in the ground / capability: pipes within or adjacent to the disputed area such that the association can provide service within a reasonable time after a request; and
• Legal right: authority under state law to serve the area.

Here, the parties agreed on the second prong (legal right). The dispute turned on the first: whether Dupont could provide service “within a reasonable time after a request for service occurs.” The panel’s key doctrinal move was to treat “reasonable time” not as a hypothetical engineering debate but as an answerable historical question on these facts.

3) Torry v. City of Chicago, 932 F.3d 579 (7th Cir. 2019)

The court briefly invoked Torry to reject Dupont’s hearsay challenge to DLZ’s October 29 email. The email was admissible to show its effect on the listener (that Dupont received communications and deadlines), not for the truth of asserted engineering facts—an evidentiary point that bolstered the timeline showing Dupont’s notice and non-response.

4) Circuit authority on § 1926(b)’s breadth and “offensive” use

The court cited multiple circuits that, like Jennings, read § 1926(b) broadly to reach municipal sales competition: City of Madison v. Bear Creek Water Ass'n, Inc., Glenpool Util. Servs. Auth. v. Creek Cnty. Rural Water Dist. No. 2, Bell Arthur Water Corp. v. Greenville Utils. Comm'n, and Ross Cnty. Water Co. v. City of Chillicothe. It also noted textual tension recognized elsewhere: Chesapeake Ranch Water Co. v. Bd. of Comm'rs and Pub. Water Supply Dist. No. 3 v. City of Lebanon.

Finally, the panel referenced Le-Ax Water Dist. v. City of Athens as an example of state-law boundary limits potentially constraining “offensive” § 1926(b) expansion—limits the court observed did not exist here.

B. Legal Reasoning

1) The new operational clarification: “reasonable time” can be proved (or disproved) by what actually happened

The opinion’s most important contribution is practical and evidentiary: where the record contains a real-world request for service and a real-world response timeline, “reasonable time” under the first prong of the “physical capability” test is not a purely hypothetical engineering inquiry. The court treated Dupont’s multi-year failure to deliver infrastructure, pricing, or a contract as dispositive proof that it had not “made service available.”

This approach limits a common litigation strategy in § 1926(b) cases: relying on after-the-fact expert reports to establish that service could have been provided quickly, even though it was not. The court did not say experts are irrelevant; it said that in this posture—years of documented inaction after repeated communications—expert testimony about present-day feasibility cannot “rebut that historical fact.”

2) What counts as a “request for service”: substance over form

Dupont argued Jefferson County never “requested” service because it did not complete Dupont’s ordinary customer application. The court rejected that formalism as incompatible with the record and the context (a major public project requiring non-standard infrastructure and high-volume pricing). Extensive communications—engineering discussions, repeated requests for rate information, and Dupont’s own letters insisting it was the exclusive provider—were enough for any reasonable juror to deem a request made.

3) Rate inquiries did not negate a request

The panel also rejected the notion that the County’s inquiry into Madison’s rates nullified its earlier requests to Dupont. Especially given the County’s continued follow-ups after its May 2021 vote to support Madison service, the timeline showed persistence rather than mere “rate shopping.” This mattered because § 1926(b) protection depends on whether service was made available after a request—not on whether the potential customer also explored contingencies when the association stalled.

4) Procedural posture: summary judgment and materiality

On de novo review, the court found no genuine dispute of material fact because the undisputed communications and lack of performance foreclosed a reasonable jury finding that Dupont met the “made available” requirement. The decision thereby reinforces that § 1926(b) claims can fail at summary judgment when the provider’s own timeline shows prolonged non-responsiveness after a concrete request.

C. Impact

1) Incentives for USDA-indebted associations: monopoly claims require operational follow-through

This decision strengthens an accountability principle within the Seventh Circuit’s § 1926(b) framework: a rural water association cannot rely on statutory exclusivity while failing to act with reasonable dispatch when approached for service. The ruling makes “reasonable time” a meaningful constraint, not a purely theoretical capability.

2) Reduced leverage from post hoc engineering opinions

Future litigants should expect courts to discount feasibility studies created only after conflict ripens—particularly if the record shows the association did not seriously plan, price, or engineer service during the relevant period.

3) Possible doctrinal inflection point on the horizon (Jennings)

Although dicta, the court’s extended discussion of revisiting Jennings Water is notable. The panel flagged concerns that the current interpretation may:

• extend beyond § 1926(b)’s text (annexation/franchise);
• enable “offensive” monopolization of new, large customers; and
• discourage efficient rural development where municipalities are better situated to serve.

Litigants in future Seventh Circuit cases should anticipate renewed challenges to Jennings, potentially via en banc review or a case presenting the issue cleanly.

4. Complex Concepts Simplified

• 7 U.S.C. § 1926(b): A federal protection for rural water associations that owe money on USDA loans. It prevents certain kinds of competitive encroachment so the association can maintain a stable customer base to repay federal debt.
• “Provided or made available”: A trigger phrase defining the protected territory. Under Seventh Circuit law, it requires more than an abstract entitlement; the association must be positioned and prepared to serve.
• “Pipes in the ground” / “physical capability” test: A shorthand for whether the association has infrastructure near enough—and operational readiness sufficient—to provide service within a reasonable time after a request.
• Summary judgment: A decision without trial when no reasonable jury could find for the non-moving party on the key facts.
• Effect-on-the-listener (not hearsay): A statement offered to show notice or impact on the recipient (e.g., that Dupont received a deadline), not to prove the statement’s factual content.

5. Conclusion

Dupont Water Company, Inc. v. City of Madison, Indiana clarifies that § 1926(b)’s “made available” protection is not preserved by asserting exclusivity while delaying action: where a real request for service is met with years of inaction, the association cannot establish it could serve “within a reasonable time,” and municipal service to the customer will not violate § 1926(b) under existing Seventh Circuit precedent. The opinion also plants a marker for future litigation by questioning whether the Seventh Circuit’s expansive reading of § 1926(b) in Jennings Water coheres with the statute’s text and policy.