Senate bill would double smart water grants to $50 million a year

A $50 million-a-year federal grant line for leak sensors, smart meters and AI analytics would pay to install the gear and train the crews. It would not pay to maintain any of it. That is the shape of the Water Infrastructure Modernization Act of 2025, S. 2388, as WaterWorld associate editor Alex Cossin described it in August 2025.

The bill was introduced in the Senate on July 23, 2025, by Sen. Ruben Gallego of Arizona with Sen. John Curtis of Utah as co-sponsor, according to WaterWorld. It would amend the Clean Water Act to reauthorize the EPA's pilot program for alternative water source projects and widen it to cover what the text calls intelligent water infrastructure technology. Annual authorization would double from $25 million to $50 million, and the program's life would stretch from 2026 to 2028.

One caution on timing. As of WaterWorld's Aug. 12, 2025 report the bill was still at the introduced stage, and the sources reviewed here do not document later committee or floor action. Everything below describes the bill as written, not a program a utility can apply to today.

Design and training are in, feasibility studies and upkeep are out

Eligible costs under the bill run to engineering, design, construction, implementation, training and operations tied to the technology, WaterWorld reported. Planning, feasibility studies, and operation and maintenance are ineligible. The EPA would run the grant program.

Read those two lists side by side and there is a wrinkle. WaterWorld's summary puts operations on the eligible side and operation and maintenance on the ineligible side, so the line between funded startup operations and unfunded recurring upkeep is something any applicant would need to pin down in the bill text itself.

The exclusions matter more than the inclusions for a utility finance director. The feasibility study that justifies an advanced metering rollout would have to be paid for before an application goes in, and the sensor batteries, data subscriptions and software renewals that follow would land on the rate base after the grant closes out. For a utility whose real cost of leak detection sits in year-three sensor replacement rather than year-one installation, the program as described would cover the front end and leave the recurring bill in place.

A wide definition of intelligent

The bill's definition is broad. Per WaterWorld's reading of the text, it covers:

• Predictive maintenance, analytics and real-time monitoring for stormwater and wastewater systems
• Optimization and AI tools intended to lower operating costs and support better decisions
• Remote sensing in real time to detect leaks, bursts and water quality problems
• Metering upgrades that support conservation
• New approaches to combined sewer overflow control, along with groundwater banking and predictive aquifer recharge
• Tools that find leaks and assess pipe integrity
• Water supply projects built for resilience, paired with weather-linked monitoring
• Digital tools for advanced design and construction management

That last item is easy to skip past. It puts digital design and construction management software in the same eligible bucket as field hardware, which means a utility's capital delivery team, and not only its operations group, could have a claim on the money if the bill passes as written. A plant manager scoping a treatment expansion and a distribution superintendent scoping a meter swap would be reading the same grant notice.

There is no single technical thread running through the list. A groundwater banking project and a smart meter network share almost nothing except a data feed. What they share under this bill is eligibility, which makes its working definition of intelligent closer to instrumented than to any particular system architecture.

$50 million next to the federal water baseline

Fifty million dollars a year is a national figure, not a per-utility one. Civil Engineering Magazine, ASCE's publication, reported in August 2021 that the $1.2 trillion Infrastructure Investment and Jobs Act carried $550 billion in new spending above the existing baseline across essentially all infrastructure sectors, and that it reauthorized the Clean Water and Safe Drinking Water state revolving funds. The same report noted ASCE's 2021 Report Card had graded U.S. infrastructure an overall C-.

Against that baseline, S. 2388 is a pilot line, and a pilot is what the bill calls it. Split across every water and wastewater system in the country, $50 million a year is demonstration money.

Where the program could earn its keep is in the paper trail. WaterWorld reported the bill would require annual reports to Congress on funded projects, resiliency gains and recommendations, plus an initial report listing denied applications and the reasons for denial. For a utility deciding whether to spend staff time on a second-round application, that denial list, if it materializes, would say more about how to write a winning application than the eligibility text does.

The vendors and utilities already moving

The technology side of this market is not waiting on Congress. The same week WaterWorld covered the bill, its Aug. 18, 2025 newsletter carried news that Waterly, a U.S. software firm building digital tools for water and wastewater utilities across North America, had raised a $4 million Series A led by Burnt Island Ventures with Emerald participating. The newsletter also featured Raytown Water Company's transition to an AMI system for the City of Raytown.

Those are the kinds of projects the bill's list describes: operations software and advanced metering. Neither depended on S. 2388. If the bill moves, it would add a federal cost-share for the install and training phases of work utilities are already specifying; if it does not, the specifications do not change.

The 2026 horizon on the existing program

The timing detail worth holding onto is the current program's end date. WaterWorld reported the existing authorization runs through 2026, this year, and that S. 2388 would push it to 2028. Whether that extension happens is the open question; the most recent status WaterWorld reported, from Aug. 12, 2025, had the bill sitting at the introduced stage.