Billions Flow to Rebuild America’s Water Systems

EPA opens $7B in low-cost financing for water infrastructure projects, including stormwater, helping cities accelerate climate-ready upgrades

15 Dec 2025

The US Environmental Protection Agency has opened about $7bn in new federal financing for water infrastructure, offering cities cheaper, long-term loans to accelerate upgrades to drinking water, wastewater and stormwater systems.

The funding is being made available through the Water Infrastructure Finance and Innovation Act, or Wifia, under a series of recent notices from the agency. The programme provides low-interest loans with long maturities, allowing local authorities to spread large capital costs over decades rather than relying on grants or municipal bonds alone.

The move comes as cities face growing pressure from climate-driven flooding, urban expansion and ageing pipes. Stormwater systems, often underfunded compared with drinking water and wastewater networks, are increasingly strained by heavier rainfall and more frequent extreme weather events.

Wifia financing can be used for a wide range of projects, from pipe replacement and treatment upgrades to drainage improvements and flood control. While stormwater is only one of several eligible categories, infrastructure specialists say demand is likely to rise as cities look for ways to reduce flood risk and protect waterways.

In announcing the latest funding availability, EPA administrator Michael Regan said modern water infrastructure was central to meeting climate and resilience challenges, underscoring the agency’s push for larger and more integrated investment programmes.

Access to federal loans of this scale allows cities to group multiple projects into coordinated investment plans, rather than responding to failures as they occur. That approach can provide greater certainty for long-term planning and create steadier pipelines of work for engineering firms, contractors and technology providers involved in design, construction and monitoring.

However, barriers remain. Applying for Wifia loans requires strong balance sheets, detailed project development and readiness to begin construction. Smaller or financially constrained communities can struggle to meet those requirements. Stormwater projects must also compete with other water priorities, requiring clear evidence of benefits such as flood reduction, environmental protection and long-term cost savings.

Even so, the size and structure of the financing suggest a sustained federal commitment to renewing water infrastructure. As more projects move forward under the programme, stormwater upgrades are expected to form a larger part of broader efforts to make US cities more resilient to climate risks.