Water and Sewer

Water & Sewer

The Bipartisan Infrastructure Law (BIL) dedicates $55 billion to various programs representing the largest investment in drinking water, wastewater, water reuse, conveyance and water storage infrastructure in American history, including dedicated funding to replace lead service lines and address the dangerous chemical PFAS (per- and polyfluoroalkyl).

Funding Overview:

This funding falls into seven major programs covered under this section – (1) the Drinking Water and Clean Water State Revolving Funds ($23.43 billion), (2) Lead Service Lines ($15 billion), (3) PFAS and Emerging Contaminants ($10 billion), (4) Indian Water Rights ($2.5 billion), (5) Indian Health Service Sanitation Facilities Construction ($3.5 billion), (6) Water and Sewer Tax ($1.25 billion), (7) Western Water including Rural Water ($8.3 billion).

The Drinking Water and Clean Water State Revolving Funds provide below market rate loans and grants to fund water infrastructure improvements to protect public health and the environment. This additional funding will go towards existing Environmental Protection Agency programs– the fiscal year 2022 allocations from the Bipartisan Infrastructure Law can be found here.

The Lead Service Lines program provides funding for lead pipe replacement. This was announced as part of a broader Lead Pipe and Paint Action Plan on December 16, 2021. The fact sheet covering the entirety of the program can be found here.

The PFAS and Emerging Contaminants program provides funding for States and water utilities to be used in the treatment of any pollutant that is a perfluoroalkyl or polyfluoroalkyl substance (PFAS) or any pollutant identified by the Environmental Protection Agency Administrator as a contaminant of emerging concern.

The Western Water program appropriates funds to be spent on projects associated with water storage, groundwater storage, and conveyance projects, water recycling and reuse projects, water desalination projects and studies, watershed management, dam repair and replacement, repairing and replacing aging infrastructure, and WaterSMART grants.

The Indian Health Service Sanitation Facilities Construction program provides American Indian and Alaska Native homes and communities with essential water supply, sewage disposal, and solid waste disposal facilities. The Indian Health Care Improvement Act requires the Indian Health Service to maintain inventories of sanitation deficiencies for existing Indian homes and communities, to prioritize those deficiencies, and to annually report those deficiencies to Congress.

The Water and Sewer Tax excludes from taxable income any “contribution in aid of construction” or any other contribution for purposes of water storage.

Rural Water Projects invest in water infrastructure projects in rural communities.

The above information comes from the BIL Guidebook available at build.gov.

Existing Programs

  • Water & Groundwater Storage and Conveyance — This existing $1 billion program at the Department of Interior provides funding for water storage projects with a capacity between 2,000 and 30,000 acre-feet – as well as projects that convey water to or from surface water or groundwater storage. The Department will hold its final stakeholder sessions this month and open applications later this spring.
  • Emergency Watershed Protection Program This existing Department of Agriculture program will provide $300 million in technical and financial assistance to project sponsors for the design and construction of measures to help repair damages from a recent disaster. Applications open in February.
  • Funds from State and Local Fiscal Recovery Funds as part of the American Rescue Plan can be used to support necessary improvements in water, including for the State Revolving Funds, lead service line replacement programs, and other projects that assist systems most in need to provide clean drinking water. See more about the guidance that permitted the use of these funds here.
  • Funding through the CARES Act State and Local Fiscal Recovery Funds can also be used to make necessary investments to improve access to clean drinking water.
  • Agency’s existing State Revolving Funds and grant programs under the Water Improvements for the Nation Act, including $25 million in 2022 to improve drinking water quality in small, underserved, and disadvantaged communities; and additional funding for lead testing in school and child care drinking water grants, and reducing lead in drinking water grants.
  • Department of Agriculture funds are also available through the Water and Waste Disposal Loan and Grant Program.
  • Department of Housing and Urban Development Community Block Development Block Grant funds are available for a wide range of community needs, including lead reduction initiatives.



Alaska Dept. of Environmental Conservation (DEC) – The DEC will be implementing a large amount of the funds for clean water and sewer in Alaska. The State Revolving Fund (SRF) for clean water and drinking water will have significantly increased funding, such that they will be able to provide largely forgiven loans to eligible water & sewer projects. Learn more about the SRF here. The DEC is responsible for planning use of clean water resources across the state, and one of the main instruments for doing this is their Intended Use Plan, which releases updated project priority lists quarterly. Contact the DEC to learn more about how this plan is created and share your community’s priorities.

U.S. Environmental Protection Agency (EPA) – The EPA is responsible for national distribution of money for water & wastewater infrastructure. This includes setting the regulations for state SRF programs, implementing tribal set-asides of Clean Water Funds, and pollution prevention programs.