The Water Infrastructure Modernization Act of 2025 amends the Federal Water Pollution Control Act to reauthorize the pilot program for alternative water source projects and to codify intelligent water infrastructure technology (IWIT) within the grants program. It defines IWIT and lays out a broad set of technologies meant to improve energy efficiency, reliability, and resiliency of water treatment, collection, and distribution systems.
The bill also expands grant uses to cover engineering, design, construction, and implementation of IWIT projects while prohibiting planning, feasibility studies, operation, or maintenance with grant funds.
At a Glance
What It Does
The bill adds a comprehensive IWIT definition to the program and expands grant scopes to cover engineering, design, construction, implementation, training, and operations tied to IWIT adoption. It also creates reporting requirements and increases the grant funding cap.
Who It Affects
Municipal water utilities, engineering firms, and state/federal grant administrators implementing IWIT; ratepayers and disadvantaged communities benefiting from conservation and reliability improvements; regulators overseeing water quality and resilience.
Why It Matters
By enabling real-time monitoring, predictive maintenance, and AI-driven optimization, the bill aims to lower energy and chemical costs, reduce water losses, and improve resilience against climate impacts.
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What This Bill Actually Does
The bill adds a formal definition of intelligent water infrastructure technology (IWIT) to the Federal Water Pollution Control Act, covering real-time monitoring, sensors, analytics, AI-driven optimization, and data-driven water management. It also includes groundwater banking, stormwater management, and advanced digital design as core IWIT components.
The intent is to equip water systems with technologies that detect leaks, monitor water quality, optimize energy use, and improve decisionmaking in real time.
Grant provisions are updated to allow funding for the engineering, design, construction, implementation, and operational aspects of IWIT on eligible alternative water source projects. However, grants cannot fund planning, feasibility studies, ongoing operation, or routine maintenance.
Costs related to IWIT are treated as not being operation and maintenance for grant purposes, enabling different accounting treatment and potential upfront capital deployment. The bill also establishes reporting requirements: within 180 days of enactment and annually thereafter, the Administrator must report on grant awards, project resiliency improvements, and recommendations to strengthen grant effectiveness.
Finally, it increases the program’s funding cap from $25 million to $50 million and extends the initial reporting horizon to 2028, expanding the scale and timeline of pilot and rollout efforts.
The Five Things You Need to Know
The bill defines intelligent water infrastructure technology (IWIT) with real-time monitoring, predictive analytics, and AI-based optimization.
Grants may fund engineering, design, construction, implementation, training, and IWIT-based operations—but not planning, feasibility, maintenance, or routine operation.
Costs tied to IWIT are not counted as operation or maintenance for grant purposes.
The Administrator must provide an annual report to Congress on projects and resiliency improvements, starting within 180 days of enactment.
Funding for the program increases to $50 million and the initial reporting year is pushed to 2028.
Section-by-Section Breakdown
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Definition of Intelligent Water Infrastructure Technology
Adds a broad, technology-forward definition of IWIT. It includes real-time monitoring and data analytics for wastewater and stormwater systems, AI-enabled optimization to cut energy and chemical costs, remote sensing, groundwater banking, and stormwater management. The provision also covers advanced digital design and construction tools, non-destructive leak detection, metering infrastructure, and data-driven decisions aimed at improving reliability and resiliency.
Uses of Grants for IWIT
Revises grant uses to authorize funding for engineering, design, construction, implementation, training, and operations related to IWIT adoption. It also prohibits using grants for planning, feasibility studies, operation, or routine maintenance. Importantly, costs associated with IWIT are not considered operation or maintenance for the purposes of grant accounting.
Reporting Requirements
Requires, not later than 180 days after enactment and at least annually thereafter, a Congress-facing report detailing grant awards for IWIT purposes and the resiliency improvements achieved. The initial report also must describe the implementation status, including denials and reasons for denial of grant applications.
Funding and Timing Adjustments
Increases the authorization for grants from $25,000,000 to $50,000,000 and extends the initial annual reporting timeline from 2026 to 2028, signaling a larger and longer-running commitment to IWIT pilot projects and scale-up.
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Explore Infrastructure in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Municipal water utilities adopting IWIT will see energy and chemical cost reductions and improved reliability due to real-time monitoring and AI optimization.
- Ratepayers in disadvantaged communities will benefit from enhanced conservation efforts and more resilient water supplies.
- Regulators and public health agencies gain access to richer data and better monitoring of water quality and system performance.
- Engineering firms and technology providers specializing in sensors, analytics, and digital design will have expanded opportunities from IWIT projects.
- Communities dependent on groundwater banking and stormwater management systems gain through improved water resource management and resilience.
Who Bears the Cost
- Utilities face upfront capital costs to install IWIT hardware and software and to overhaul design and construction processes.
- Some ratepayers may bear increased costs if grant funding does not cover all initial capital expenditures or if savings take longer to materialize.
- Utilities must address interoperability between IWIT and existing legacy systems, which may require additional investment.
- Grants do not cover ongoing operation or maintenance, shifting some long-term costs to utilities or ratepayers after project completion.
- Public agencies may incur higher administrative and reporting costs to manage and oversee the expanded program.
Key Issues
The Core Tension
The central dilemma is whether the bill’s emphasis on upfront IWIT capital investments and aggressive data-driven improvements can be sustained long-term given the prohibition on grant-funded operation and maintenance and the risks of interoperability, cybersecurity, and funding gaps for ongoing upkeep.
The bill accelerates adoption of IWIT and related water-management innovations by expanding grant eligibility, but it also creates a planning-and-implementation bias toward capital projects over recurring maintenance. This design emphasizes resilience and efficiency gains while potentially deferring long-term O&M planning and funding.
Data management, cybersecurity, and interoperability with older infrastructure are practical risks that accompany real-time monitoring, AI, and sensor networks. The reporting requirements will impose additional administrative work for the Administrator and Congress to track effectiveness and denials, which could influence future funding decisions.
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