EPA announces $2.9 billion for lead pipe replacement as states receive 2026 allotments
Key Highlights
- The EPA's FY 2026 funding totals approximately $2.875 billion, slightly less than the previous year's allocation of $3 billion.
- Major allocations include Illinois ($295.6M), Ohio ($201.8M), and New York ($185.2M), targeting states with high concentrations of lead service lines.
- Nearly 49% of the funds are mandated to be subsidized as grants or principal forgiveness, prioritizing disadvantaged communities.
The U.S. Environmental Protection Agency (EPA) announced nearly $2.9 billion in fiscal year 2026 funding through the Drinking Water State Revolving Fund (DWSRF) to accelerate the replacement of lead service lines (LSLs) nationwide, marking one of the largest annual federal investments yet aimed at reducing lead exposure in drinking water systems.
According to EPA, the funding will support state and local efforts to identify, inventory and replace lead pipes that connect water mains to homes and buildings. Utilities can also use the money for planning and related lead reduction activities. EPA Assistant Administrator for Water Jess Kramer said the investment is intended to “accelerate local efforts to find and replace toxic lead pipes.”
The funding comes as utilities across the country face mounting pressure to comply with EPA’s Lead and Copper Rule Improvements (LCRI), which established a national requirement for drinking water systems to replace all lead service lines over a 10-year period. Many utilities are now developing inventories, prioritizing replacement projects and seeking long-term financing strategies to meet those mandates.
Total funding drops slightly
For FY2025 total funding ammounted to $3,000,000,000. For FY2026 total funding dropped slightly to a total amount of $2,875,000,000 - a reduction of $125M.
Illinois, Ohio and New York receive largest lead pipe replacement allocations
The FY 2026 allotment tables show that EPA distributed the funding based on estimates from the 7th Drinking Water Infrastructure Needs Survey and Assessment (DWINSA), using data tied to the estimated location of roughly 4 million lead service lines nationwide.
Under the allocation formula, Illinois will receive the largest share of funding at approximately $295.6 million, representing 10.76% of total available state funding. Ohio follows with roughly $201.8 million, while New York will receive about $185.2 million. Michigan, Indiana and Pennsylvania also received some of the nation’s largest allocations.
The funding breakdown highlights how EPA is targeting states with historically large concentrations of lead service lines, many of them located in older industrial regions with aging drinking water infrastructure. Illinois alone is estimated to have one of the highest lead service line counts in the country, driven largely by legacy infrastructure in Chicago and other urban systems.
Other notable FY 2026 allocations include:
- Michigan: approximately $143.5 million
- Indiana: approximately $128.6 million
- Pennsylvania: approximately $126.1 million
- New Jersey: approximately $103.1 million
- Wisconsin: approximately $94.3 million
- Texas: approximately $76.6 million
- Missouri: approximately $63.6 million
- Minnesota: approximately $57.8 million
- Kansas: approximately $53.8 million
EPA’s allotment document also notes that a minimum allocation floor of 1% continues to apply to many states, resulting in numerous states receiving approximately $27.5 million each regardless of estimated lead line counts.
Bipartisan Infrastructure Law funding requires nearly half of aid to be subsidized
In addition to the base allocations, EPA outlined required “additional subsidization” amounts tied to the Bipartisan Infrastructure Law’s lead service line replacement funding. Those provisions require 49% of funding to be provided in the form of principal forgiveness or grants to disadvantaged communities.
Illinois again received the largest required subsidy amount at nearly $144.8 million, followed by Ohio at approximately $98.9 million and New York at roughly $90.8 million.
The agency is also redistributing an additional $18 million in previously announced but unused lead-related DWSRF funding to eligible states, consistent with Safe Drinking Water Act provisions governing unused allocations.
Utilities face growing pressure to meet EPA Lead and Copper Rule requirements
The FY 2026 announcement continues the federal government’s multi-year push to eliminate lead service lines following heightened national attention on drinking water contamination issues in cities such as Flint, Michigan, and Newark, New Jersey. Since passage of the Bipartisan Infrastructure Law in 2021, EPA has directed tens of billions of dollars toward drinking water infrastructure improvements, with lead service line replacement serving as one of the law’s highest-profile priorities.
Utilities and state revolving fund administrators are expected to move quickly to obligate the new funding, particularly as systems begin implementing inventory requirements and replacement schedules under the LCRI framework. Industry groups have repeatedly noted that the pace of replacement will depend not only on available funding, but also on workforce availability, contractor capacity, customer coordination and access to accurate service line records.
EPA reserves additional Drinking Water SRF funding for tribal water systems
EPA’s FY 2026 allotment tables also show that $57.5 million was reserved nationally for American Indian and Alaska Native water systems, while an additional $57.5 million was designated for other set-asides.
The total FY 2026 lead service line replacement appropriation is listed at $2.875 billion.
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].