Ferguson Legislation Center

Access IIJA Funding for Water Infrastructure Projects

As bipartisan infrastructure legislation (BIL) takes center stage in the national spotlight, the federal government is improving and expanding access to precious resources by allocating funds for water, wastewater, stormwater and related resiliency projects. Municipalities can apply for these funds to support a range of water infrastructure projects.

Discover what’s in the Infrastructure Investment and Jobs Act for water projects, how funds are allocated and distributed, and how Ferguson can help your utility or municipality access these funds.

Contact our friendly municipal expert for IIJA answers. Ask Dave

What is the 2021 Infrastructure Investment and Jobs Act (IIJA)?

The bipartisan infrastructure bill passed in 2021 and includes new spending over the next five years to update infrastructure across the U.S., including airports and rail, public transit, roads and bridges, broadband and ports and waterways. Billions are allocated for drinking water and wastewater infrastructure projects.

What is in the infrastructure bill for water?

The IIJA includes $55 billion above the normal baseline of Environmental Protection Agency (EPA) funding for water infrastructure projects for fiscal years 22 through 26. Safe drinking water, clean water and regional waters are included in federal funding for water infrastructure, as well as distributions for emerging contaminants, wastewater and more.

Utilities and municipalities can access IIJA funding for water infrastructure projects in a number of ways, including the Drinking Water State Revolving Fund (DWSRF), Clean Water State Revolving Fund (CWSRF) and FEMA Hazard Mitigation programs.

The IIJA funds available are still evolving, but there are two main buckets of funds for clean water and drinking water projects as of May 2022:

Summary of BIL Funding

Program FY22 FY23 FY24 FY25 FY26 TOTAL
CWSRF General Supplemental $1.9B $2.2B $2.4B $2.6B $2.6B $11.7B
CWSRF Emerging Contaminants $100M $225M $225M $225M $225M $1B
DWSRF General Supplemental $1.9B $2.2B $2.4B $2.6B $2.6B $11.7B
DWSRF Lead Service Line Replacement $3B $3B $3B $3B $3B $15B
DWSRF Emerging Contaminants $800M $800M $800M $800M $800M $4B

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The IIJA funding also includes a significantly expanded Buy American clause, American Iron and Steel (AIS) provision and newly added Build America, Buy America (BABA) provisions, among others. Explore IIJA water appropriations in depth below and reach out to Ferguson to discuss applying for funds for your next project.

Over five fiscal years, state revolving loan funds will receive billions through the Clean Water Act, including for the first time funds specifically to address emerging contaminants in clean water SRFs. For the clean water general program, states must match 10% of annual capitalization in fiscal years 2022 and 2023, and 20% afterward. States may also choose to provide additional subsidies to principal forgiveness loans and grants.

For clean water funds for emerging contaminants, states do not have to match capitalization grants, and 100% of each state’s allotment is to be used for principal forgiveness or grants.

Similar to the clean water funds, billions are available over five fiscal years for the DWSRF program. For the drinking water program, states can provide additional subsidization in certain cases and, with at least 6% of the annual grants, are also conditionally required to provide additional subsidization to eligible recipients.

For the drinking water general program, states must match 10% of annual capitalization for the first two fiscal years of 2022 and 2023, and 20% for the following three years.

For the emerging contaminants funds in the drinking water program, 100% of state allotments are in the form of principal forgiveness or grants, and states don’t have to match capitalization grants.

Some wastewater SRF appropriations are included in both clean water and drinking water funds, and there are additional programs specifically for wastewater. Those include grants regarding stormwater and sewer overflows; connecting to publicly owned treatment plants; pilot programs for wastewater efficiency; and more.

The WIFIA program provides low-cost, flexible supplemental loans on a range of water infrastructure projects. Local, state, tribal and federal government entities, among others, are eligible to borrow for projects that include clean water and drinking water SRF, stormwater management, water recycling and more through this federal credit program.

With $3 billion annually appropriated over five years, the funds for lead service line replacements don’t require a state match, and states must distribute 49% of the funds through grants or loans with principal forgiveness specially appropriated for disadvantaged and underserved communities.

Over $8 billion in funds managed largely by the Bureau of Reclamation provide a range of competitive grants and loans focused on water issues and drought in the Western United States, including water recycling and reuse, outdated water infrastructure and water storage.

In support of state efforts, UIC grant money and competitive grant funding go toward improving the protection of underground drinking water sources.

In addition, grants, technical assistance and revolving loan funds are available for assessment, cleanup and revitalization of brownfields as part of the Comprehensive Environmental Response, Compensation and Liability Act.

FEMA provides communities and not-for-profits direct grants for cost-effective projects that mitigate risk from future natural disasters. Applicants in federally recognized tribal governments and all 50 states and territories can apply for up to $1 million.

A national competition for subapplicants is also available for up to $50 million in federal share. In addition, IIJA funds will support SRF resiliency for mitigation projects.

Ferguson can help with your infrastructure bill water projects

If you’re ready to create a better future for water in your municipality with these IIJA water funds or others, partner with Ferguson. Our knowledgeable associates understand the unique challenges municipalities and water authorities face, and we specialize in helping public and private water agencies navigate strict tax codes and government requirements.

Contact Ferguson today to discuss applying for IIJA funds, commercial project management, quotation services and more.

This webpage is for information purposes only. The information provided here should be evaluated and verified for application to individual projects. Ferguson Enterprises, LLC does not represent or warrant that funds available through any of the programs discussed above will be available to support any particular project.