2025 Review of How Federal Programs Support Vulnerable Communities’ Water Systems

In August 2025, the Government Accountability Office released GAO-25-107013, a sweeping look at how EPA, FEMA, and USDA have funded and measured resilience in drinking water and wastewater systems—especially in communities most exposed to natural disasters. The report frames the stakes clearly: outages in Jackson, Mississippi in 2022 and in western North Carolina after Hurricane Helene in 2024 left residents without potable water for weeks, underscoring how fragile these systems can be when disasters hit.

GAO finds that from fiscal years 2014–2023, 14 federal programs provided roughly $35 billion in grants across at least 22,000 projects and about $29 billion in direct loans for roughly 4,800 projects to improve water infrastructure nationwide. Most funding flowed through EPA’s Clean Water and Drinking Water State Revolving Funds and USDA’s Water and Waste Disposal program, while EPA’s Water Infrastructure Finance and Innovation Act (WIFIA) accounted for the largest share of direct loans.

The report emphasizes that “vulnerable communities”—often rural or low-income areas, but ultimately defined by each program’s statute—continue to face barriers in accessing and managing assistance. Agencies have expanded technical assistance and, in some cases, allow recipients to meet nonfederal cost-share requirements with help from other federal programs. But GAO flags that FEMA has not adequately communicated that, in certain cases, USDA funds can be used to satisfy FEMA’s cost-share—an avoidable obstacle for applicants already resource-constrained.

A central theme is measurement: agencies commonly assessed benefits using national or state-level data, yet they often lacked precise maps of which neighborhoods actually receive service from a given utility. That matters because utility service areas do not always match municipal borders or the contours of vulnerability within a city. EPA has released a national mapping tool for community drinking water system service areas and is developing a similar tool for wastewater systems, expected in summer 2025. GAO argues that using these maps would enable EPA, FEMA, and USDA to more accurately determine who benefits from federally supported projects.

GAO also examines costs on the ground. Utilities—especially small systems—struggle to finance major upgrades and to absorb long-term loan repayments, and many forms of federal assistance cannot be used for operations and maintenance. The report notes that the mix of grants and loans has shifted with market conditions and supplemental appropriations (e.g., the Infrastructure Investment and Jobs Act), but the long-term financing burden for communities remains significant.

To improve access and accountability, GAO makes eight recommendations: four to FEMA, two to USDA, and two to EPA. For FEMA, GAO urges clearer communication about using USDA assistance to meet cost-share requirements, systematic tracking and analysis of subapplicant withdrawals to diagnose barriers, and identification and tracking of water-related mitigation projects coupled with the use of EPA mapping tools to assess beneficiaries. For USDA and EPA, GAO calls for consultation on and guidance for using EPA’s service-area maps to assess who benefits—especially in communities defined as disadvantaged under program statutes. While EPA and FEMA disagreed with using the mapping tools and USDA did not comment, GAO maintained its recommendations.

Methodologically, GAO analyzed FY2014–2023 assistance data, reviewed statutes and prior executive policies, and interviewed a nongeneralizable sample of 14 utilities with recent disaster experience. The result is a practical blueprint: build better evidence about who benefits, remove preventable barriers like unclear cost-share rules, and use emerging service-area data to target investments where resilience payoffs are greatest.

Credit: Report to congressional requesters by the U.S. Government Accountability Office; points of contact Christopher (Chris) Currie and J. Alfredo Gómez, with contributions from the GAO team acknowledged in the report.

Disclaimer: This summary is provided for general information only and does not constitute legal, technical, or financial advice. While based on GAO-25-107013, any errors or omissions are mine; readers should consult the GAO report for complete findings, methods, and recommendations