The EPA announces $2.9 billion for states to support lead pipe replacement

Key Takeaways

On May 20, the U.S. Environmental Protection Agency (the EPA) announced $2.9 billion in funding to help states support lead service line replacement. The funding will be distributed through the Drinking Water State Revolving Fund (DWSRF) and can be used by communities to identify lead pipes, plan removal projects, and replace lead service lines that deliver drinking water to homes.

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Lead service line replacement is a drinking water and public health issue for counties, particularly those with older infrastructure or limited local financing capacity. Lead is especially harmful to children, and replacing lead pipes can reduce exposure risks for residents.

How the Drinking Water State Revolving Fund works

Congress established the DWSRF in 1996 to help finance drinking water infrastructure projects. Through the program, the EPA provides capitalization grants to states. States then administer their own revolving fund programs and provide assistance to eligible projects based on state priorities.

Counties do not receive SRF capitalization grants directly from the EPA. However, public water systems, including those operated by counties, may receive funding through their state's DWSRF program. State SRF programs provide below-market loans and additional assistance, including principal forgiveness, for eligible drinking water projects.

The newly announced funding comes from the Infrastructure Investment and Jobs Act (IIJA), which provided $3 billion annually from FY 2022 through FY 2026 for lead service line replacement. Fiscal Year (FY) 2026 is the final year this supplemental IIJA funding is available.

The EPA is also redistributing $18 million in previously announced DWSRF funding for lead service line replacement. These funds were made available to states but were not used and will now be reallocated to other eligible states with lead service line replacement needs.

Learn more about the EPA's State Revolving Fund programs

County impact

The Clean Water and Drinking Water State Revolving Fund programs help counties finance water infrastructure projects that may otherwise be difficult to fund locally. This is especially true for rural counties and small or underserved water systems, where major drinking water projects can place pressure on ratepayers.

As states receive FY 2026 DWSRF allotments, counties should work with state administering agencies to understand project eligibility, timelines and financing options. Continued federal investment in SRFs will remain a county priority as IIJA supplemental funding expires and local drinking water infrastructure needs continue.