Infra Insight Blog

A recent Supreme Court decision has raised important questions about the impact of federal tariffs on water infrastructure costs—but offers only limited relief for project owners. While the Court ruled that certain tariffs imposed under the International Emergency Economic Powers Act (IEEPA) were unconstitutional, most tariffs affecting key construction materials like steel, aluminum and copper remain in place under other authorities. As a result, the overall cost pressures facing water infrastructure projects persist.

The decision may lead to refunds for importers who directly paid invalid tariffs, but project owners who absorbed higher prices through supply chains are unlikely to benefit. Looking ahead, ongoing uncertainty around federal tariff policy highlights the importance of strategic contracting approaches—such as incorporating reimbursement provisions—to help mitigate potential cost impacts on future projects.

Download Nossaman’s California Water Views – 2026 Outlook for a deeper look at how recent legal developments may influence water infrastructure costs and procurement strategies.