White House sends $5.8 billion water infrastructure funds to states

The Biden administration Tuesday announced $5.8 billion in water infrastructure funds for states, tribes and territories, the latest round of funding from the Infrastructure Investment and Jobs Act record level of clean water investment.

The money includes $3.2 billion for the Drinking Water State Revolving Fund for water projects and $2.6 billion for the Clean Water State Revolving Fund for storm and wastewater infrastructure.

The funds include $1 billion for seven major rural water projects, $1 billion to address “forever chemical” contaminants, and $1 billion for Great Lakes drinking water projects.

“Every person should have a right and the ability to have access to clean water, and it should not matter where you live or how much money you earn or how much money you got in your back pocket,” said Vice President Kamala Harris Tuesday in Pittsburgh, where she announced the funds. “With this investment, we are continuing our urgent work to remove every lead pipe in the country and ensure that every American has access to safe and reliable drinking water.” 

State revolving funds for drinking and wastewater act as the primary federal funding for states, which then often leverage the money by issuing municipal bonds, most of which feature triple-A ratings, to make low-interest loans to cities, counties, water districts and other governmental entities to finance infrastructure projects.

California got the largest amount of general drinking water fund appropriations, at $247 million, or 11% of total state allocations. New York got the largest chunk of clean water revolving funds, at $254 million. Nearly half of the latest round of money will be made as grants or forgivable loans to disadvantaged communities, per the Justice40 initiative, the White House said.

The general supplemental appropriations can be used to replace lead pipes to further Biden’s goal of replacing every lead pipe in the country within the decade. The IIJA features $15 billion for lead pipe replacement, and $6 billion has been announced, according to the administration. Because states are still compiling their lead pipe inventory, as required under the IIJA, the lead pipe replacement funds totals for each state has yet to be decided and will be finalized “in the coming months,” the Environmental Protection Agency said in a memo announcing the latest water funds.

The 2021 Infrastructure Investment and Jobs Act allocated an additional $3 billion in advance appropriations for each revolving fund. The IIJA money can’t be touched, but congressional Republicans may try to use that money as a rationale for cutting annual baseline appropriations.

The IIJA has allocated $22 billion so far in water funds. The law featured a total $50 billion for clean water projects, the largest investment in U.S. history, according to the administration.