U.S., Mexican, and Texas officials have outlined nearly $164 million in proposed water-conservation investments for the Lower Rio Grande Valley, including infrastructure upgrades expected to save nearly 44,000 acre-feet of water annually.
The plan would fund improvements in 12 South Texas irrigation districts, including canal lining, conversions of open canals into enclosed pipelines, and other efficiency upgrades. Most of the proposed funding remains subject to approval by the North American Development Bank and the Texas Water Development Board.
Funding Would Combine Bank, State, Federal, and Local Money
The North American Development Bank, known as NADBank, announced the proposed investments during its 2026 summit in San Antonio.
NADBank intends to provide up to $76 million in grants and loans through its Water Resiliency Fund, subject to approval by the bank’s board of directors.
The Texas Water Development Board could provide nearly $70 million in grant funding, subject to approval during its September board meeting. The U.S. Bureau of Reclamation and participating irrigation districts would contribute a combined total of almost $18 million.
NADBank funding may cover up to 50% of an individual project’s cost, allowing state, federal, and local funding to cover the remaining expenses.
Officials participating in the announcement included Mexican Ambassador to the United States Roberto Lazzeri Montaño, NADBank Managing Director John Beckham, and Texas Water Development Board Chairwoman L’Oreal Stepney.
“Water security has become one of the most critical challenges facing the future of the U.S.-Mexico border region,” Lazzeri said.
Projects Could Conserve Billions of Gallons
The 12 projects are expected to conserve nearly 44,000 acre-feet of water annually, according to NADBank. That is equivalent to approximately 14.3 billion gallons, based on the U.S. Geological Survey’s definition of 325,851 gallons per acre-foot.
The proposed improvements include lining irrigation canals to reduce seepage, converting open canals into pipelines, and upgrading distribution systems.
Those changes are intended to reduce the amount of water lost while being transported to farms and communities.
The Lower Rio Grande Valley depends heavily on water stored in the international Amistad and Falcon reservoirs. The Texas Commission on Environmental Quality administers allocations to Texas water-right holders through its Rio Grande Watermaster Program.
Valley Has Faced Persistent Water Shortages
The announcement comes as the region continues to contend with prolonged drought, water-delivery shortfalls from Mexico, and concerns about the reliability of existing supplies.
Under the 1944 Water Treaty, Mexico is required to deliver 1.75 million acre-feet of water to the United States over each five-year cycle, averaging 350,000 acre-feet annually. The United States provides Mexico with 1.5 million acre-feet from the Colorado River each year, according to the Texas Commission on Environmental Quality.
When Mexico’s treaty deliveries are reduced, TCEQ may have to adjust allocations from Amistad and Falcon reservoirs to Texas water-right holders. The agency said reduced deliveries can require agricultural, municipal, and industrial users to seek alternative supplies, reduce operations, or alter crop production.
In February, the United States and Mexico reached an agreement under which Mexico committed to deliver at least 350,000 acre-feet annually during the 2026-2030 treaty cycle and to develop a plan to repay outstanding water debt from the previous cycle, according to a joint statement from the U.S. Department of Agriculture.
The treaty commitments and the newly proposed infrastructure projects address separate parts of the region’s water challenge. Mexico’s deliveries affect the volume of water available to Texas, while the irrigation upgrades are intended to reduce losses after water enters local distribution systems.
As previously reported by The Dallas Express, water shortages contributed to the closure of Texas’ final sugar mill and prompted the federal government to provide $280 million in economic assistance to eligible Rio Grande Valley agricultural producers.
Mexican Border Projects Also Under Review
NADBank said the Water Resiliency Fund received 112 expressions of interest from communities across Mexico’s six northern border states. Sixty percent of the proposed projects came from Mexican states along the Rio Grande, known as the Río Bravo in Mexico.
The Mexican proposals are expected to focus on municipal utilities seeking to conserve water or diversify their water supplies. No specific awards for the Mexican projects were announced.
NADBank was established and capitalized equally by the United States and Mexico to finance environmental infrastructure along the countries’ shared border. The Water Resiliency Fund launched in 2025 to support water conservation, efficiency, and supply-diversification projects.
Provided by Dallas Express
