$163.6M Infrastructure Boost Targets Water Conservation Across RGV

AUSTIN, Texas — State Senator Juan “Chuy” Hinojosa, D-McAllen, is praising a major bi-national and state financial package aimed at modernizing canal infrastructure and capturing millions of gallons of water currently lost to leaks and seepage across the Rio Grande Valley.

The Texas Water Development Board (TWDB) authorized $69.5 million in Water Supply Infrastructure Grants (WSIG) for canal lining and pipeline conversion projects across Hidalgo and Cameron Counties. Matched with funds from the North American Development Bank (NADBank), the U.S. Bureau of Reclamation, and local irrigation districts, total investments for the region will reach $163.6 million across 17 distinct projects managed by 12 irrigation districts.

Once completed, the modernization effort is projected to save approximately 44,188 acre-feet of water annually—roughly 14.4 billion gallons. For comparison, the City of McAllen uses about 24,500 acre-feet per year.

Legislative Action Delivers Results

Senator Hinojosa, who co-sponsored House Bill 500 during the 2025 legislative session, highlighted the collaborative efforts between local water managers and legislative leaders to secure the funds. HB 500 appropriated $1.038 billion to the TWDB for statewide water infrastructure, with agency leadership earmarking up to $100 million specifically as matching funds for NADBank’s Water Resiliency Program.

“I appreciate the TWDB setting aside funds for this historic funding opportunity to modernize canal infrastructure in the Rio Grande Valley,” Hinojosa said. “Our region continues to face significant water challenges, and all strategies to conserve and manage water must be considered. For years, and leading up to the 2025 session, many irrigation district leaders met with me, members of our legislative delegation, state leaders, and state agencies about the need to modernize our canals. We listened and took action.”

Hinojosa emphasized the real-world impact the canal lining and conversion projects will have on regional agriculture and urban communities.

“I commend our irrigation districts’ boards, their managers, and staff for working with NADBank and the TWDB to submit their applications and secure these funds,” Hinojosa added. “Many of these canals are losing huge amounts of water through seepage and leaks. These projects will ensure more water reaches our farms and communities instead of soaking into the ground. The water we will save will make a positive difference for years to come.”

This table was provided by state Sen. Juan Hinojosa's Office.

State and Binational Partnership

The WSIG program allows state grant funds to cover roughly 50 percent of eligible project costs, with NADBank providing $75.4 million through a mix of grants and loans. The remaining balance—nearly $18 million—is funded through local irrigation districts and the U.S. Bureau of Reclamation.

Governor Greg Abbott pointed to the broader legislative effort to protect Texas water supplies amidst ongoing drought conditions.

“Water is a precious resource that Texas must safeguard,” Abbott said in a statement. “Last session Texas delivered the largest water investment in state history: $20 billion for new supply and infrastructure, plus more than $1 billion in House Bill 500 grants... These projects will conserve nearly 44,000 acre-feet of water each year and deliver more reliable water to farms and families in South Texas.”

TWDB Chairwoman L’Oreal Stepney expressed enthusiasm for the joint funding approach. “We are excited to partner with NADBank to maximize our combined resources and advance our shared commitment to helping Rio Grande Valley communities conserve their water resources and improve the reliability of their water supplies,” Stepney said.

Speaking at the NADBank Summit 2026, NADBank Managing Director John Beckham emphasized the speed and coordination required to roll out the Water Resiliency Fund (WRF).

“By partnering with and leveraging resources from the Texas Water Development Board, Bureau of Reclamation, and the irrigation districts, we will maximize the impact of every dollar invested to conserve precious water resources and provide a reliable water supply for Rio Grande Valley communities,” Beckham said.

Mexican Ambassador to the United States Roberto Lazzeri Montaño noted that border-wide water security requires cross-border collaboration, pointing out that 60 percent of Mexico's 112 project proposals under the WRF came from states along the Rio Grande/Rio Bravo.

“Water security has become one of the most critical challenges facing the future of the U.S.-Mexico border region,” Ambassador Lazzeri said. “As drought conditions become increasingly severe and prolonged, the Water Resiliency Fund demonstrates the value of binational cooperation and strategic investment in strengthening the future of our shared border.”

Project Funding Breakdown

Below is the complete list of the 17 approved projects receiving TWDB Water Supply Infrastructure Grants across Hidalgo and Cameron Counties:

Source: Texas Water Development Board & North American Development Bank