Budget proposal raises concerns over cuts to water infrastructure funds
May 28, 2025
Editor's note: According to a statement from the Water and Wastewater Equipment Manufacturers Association (WWEMA), the SRF cuts were not included in the budget proposal. WWEMA expects SRF amounts will be set during later discussions on appropriation bills.
The U.S. House of Representatives narrowly passed a tax and spending bill on May 22, 2025, with a 215-214 vote. The Senate is next in line to review the budget package.
According to the nonpartisan Congressional Budget Office (CBO), the budget would add roughly $3.8 trillion to the deficit over 10 years. The budget could change as it makes its way through the Senate.
The FY2026 budget proposal initially showed a $2.46 billion reduction in Drinking Water and Clean Water State Revolving Funds compared to 2025 – however specific details about the State Revolving Fund reductions are not prominent in publicly available documents surrounding the spending bill.
In a May 21 Senate Committee on Environment and Public Works hearing, Chairman Shelley Moore Capito stated that the State Revolving Funds (SRFs) would be a part of the cuts.
“I and many of my colleagues have long been vocal about the importance of federal assistance for water infrastructure through the State Revolving Funds,” said Chairman Capito during the hearing.
Chairman Capito stated that she hopes everyone can work together to ensure that adequate resources are available to support water systems. She later questioned U.S. Environmental Protection Agency Administrator Lee Zeldin about the cuts to the SRFs.
Administrator Zeldin stated he wants to investigate congressionally directed earmarks that take away from the SRFs, but didn’t expand on what the cuts would mean for the agency and water infrastructure.
Other cuts that could impact the water industry
The budget proposal listed a number of energy, environment and communications cuts that could affect the water industry including:
- Cancels funds for green-energy grant programs in the 2022 Inflation Reduction Act
- Repeals grant programs for purchasing electric heavy-duty vehicles
- Repeals grants to reduce air pollution, greenhouse gas emissions
- Prohibits states from regulating artificial intelligence
About the Author
Alex Cossin
Associate Editor
Alex Cossin is the associate editor for Waterworld Magazine, Wastewater Digest and Stormwater Solutions, which compose the Endeavor Business Media Water Group. Cossin graduated from Kent State University in 2018 with a Bachelor of Science in Journalism. Cossin can be reached at [email protected].