In late July, the Senate released its Interior, Environment and Related Agencies Fiscal Year 2026 (FY26) appropriations bill. Its release came with some anticipation in the water sector following a recent House version – a draft and final proposal – that would slash EPA’s budget by 23% with cuts to the Drinking and Clean Water State Revolving Fund programs.
The Senate bill, however, makes milder cuts to EPA while keeping total SRF funding at $2.76 billion, even with FY24 levels. It was approved with bipartisan support.
Of the $2.76 billion for the SRFs, about $1.126 billion would be for the Drinking Water SRF, according to the Association of Metropolitan Water Agencies (AMWA), with about $1.64 billion for the Clean Water SRF. In total, the proposal from the Senate is $660 million above the level in House bill and $2.46 billion above the level requested in President Trump’s budget.
In the Senate’s bill, EPA would receive $8.64 billion, a seven percent cut in total.
The Senate bill, however, would cut funding to WIFIA by 12 percent, to $56.87 million. Meanwhile, the House appropriations bill would preserve FY25 funding levels for WIFIA.
Both bills propose level funding for EPA’s Midsize and Large Drinking Water System Infrastructure Resilience and Sustainability Program, which helps water systems pay for resilience and cybersecurity improvements. The House bill also includes level funding of $22 million for the Reducing Lead in Drinking Water grants, which helps water systems replace lead service lines. The Senate proposal would increase funding for the program by about $10 million.
The Association of Metropolitan Water Agencies (AMWA) represents large U.S. drinking water systems and has been closely following progress on the EPA budget and other water infrastrucutre funds. AMWA has advocated for fully funding the Drinking Water SRF and other programs, and said that upon passing its bill through committee, the House broke for August recess and will not be back in session until Sept. 2.
AMWA said the differences between the House and Senate appropriations packages will still need to be worked out in the two chambers and passed on the floor before Sept. 30 when Congress’ current continuing resolution expires.
The SRFs revolve at the state level to provide local water utilities access to affordable financing and are bolstered through annual federal investment. Together, the two programs represent about a third of EPA’s annual budget.
Sources: AMWA, EPA
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